One of the most powerful public servants in Canberra, Treasury secretary John Fraser, has resigned suddenly after three-and-a-half years in the job.

He will be replaced by Philip Gaetjens, a career public servant and former chief of staff to current Treasurer Scott Morrison and former Treasurer Peter Costello.

The Treasury secretary is responsible for managing the day-to-day running of arguably the government’s most important department, reporting directly to the Treasurer.

Mr Fraser was named Treasury secretary in early 2015 when Tony Abbott was prime minister. He re-joined the public service after several years in the private sector, including as chief executive of UBS Global Asset Management.

Treasurer Scott Morrison said Mr Fraser had “provided exemplary leadership and advice on economic and financial issues”.

“In this capacity, John has served as a member of the Board of the Reserve Bank of Australia, a member of the Australian Council of Financial Regulators and Chair of the G20 Global Infrastructure Hub.

“He also provided strong leadership within the Council of Federal Financial Relations Heads of Treasuries group. Mr Fraser’s tenure served to enhance the reputation of the Treasury within the public service and the wider Government.”

Mr Morrison said Mr Fraser’s replacement would bring “significant experience to his appointment”.

“Mr Gaetjens has experience in Commonwealth and State public sector leadership roles, including as Secretary of the New South Wales Treasury between 2011 and 2015, and previously served in the Commonwealth Treasury as a senior executive.

“He also held senior executive positions in the Department of the Prime Minister and Cabinet and the South Australian Treasury and Finance Department.”

Mr Fraser will leave Treasury at the end of July.