Bertie Ahern, who helped deliver peace in Northern Ireland, will step down as Ireland's prime minister on May 6, to fight allegations of corruption that have dogged his final term in office.

An emotional Ahern stressed at a televised press conference that he had done nothing wrong but would leave just a year after securing a historic third consecutive term in office so his government could focus on running the country.

"It is a matter of real concern to me that the important work of government and party is now being over shadowed by issues relating to me," Ahern said, flanked by his cabinet colleagues.

"I know in my heart of hearts I have done nothing wrong."

One of Europe's longest serving heads of government after almost 11 years as premier, Ahern had previously said this would be his last term in office but he did not intend to go until it ended in 2012.

Widely praised for his work with former Prime Minister Tony Blair and U.S. President Bill Clinton in bringing peace to Northern Ireland, Ahern's star has been on the wane after revelations about his personal finances.

Blair described Ahern and his record as remarkable.

"He will always be remembered for his crucial role in bringing about peace in Northern Ireland, for transforming relations between Britain and the Irish Republic," Blair said.

THE RIGHT THING

Gerry Adams, leader of Sinn Fein, the political ally of the now disarmed Irish Republican Army, said: "I think the Taoiseach (prime minister) did the right thing.

"Unfortunately for him ... the position was becoming increasingly untenable and the main focus of politics was around his finances and all that goes with that."

Ahern had been expected to lead the campaign for a "yes" vote in a referendum later this year that will determine the fate of the European Union's reform treaty which replaces a constitution rejected by French and Dutch voters in 2005.

He said he had decided "of his own volition" to bring forward the date of his resignation so the government would not be "distracted by incessant publicity" about the anti-corruption tribunal before which he been appearing.

Since first testifying before the Mahon Tribunal in September, Ahern has repeatedly been called back to answer questions over payments he received from friends and businessmen while finance minister in the 1990s.

Ahern, who did not have a bank account at the time, has denied any wrongdoing, describing his finances as complex but not improper following the breakdown of his marriage.

Dubbed the Teflon Taoiseach for his ability to avoid the scandal that dogged his predecessor and mentor Charles Haughey, Ahern won last year's general election despite leaks to the media detailing what the tribunal had uncovered.

Ahern's popularity has dipped in line with Ireland's once thriving economy which began to slow last year after a decade-long property boom ground to a halt.

Ahern has been finance minister or prime minister for most of the Celtic Tiger boom years when Ireland was transformed from one of Europe's poorest economies to one of its richest.