The former New Zealand Sportsman of the Year said he was hanging up his paddle following Government funding agency Sport and Recreation New Zealand (SPARC) recent decision to retract the funding that had allowed Fouhy to train seperately to the Canoe Racing New Zealand (CRNZ) high performance programme.

Fouhy, 31, announced his retirement a year ago but returned to kayaking when that funding was put in place after he publicly fell out with national coaches and Olympic greats Ian Ferguson and Paul MacDonald.

"It's all very well for SPARC to say we hold the money and this is the way it has to be done, but at the end of the day it is the athlete that has to get the boat across the line," Fouhy told the New Zealand Herald.

"You're not going to be able to compete at Olympic level against athletes who have the kitchen sink thrown at them unless you believe that what you're doing is designed to make you a better athlete."

Fouhy's decision is a sharp turnaround from last month's Blue Lake regatta in Rotorua, after which Fouhy pronounced himself pleased with his form and ready for his next block of training.

He was beaten in Rotorua by rival Steven Ferguson - son of Ian Ferguson - by two-and-a-half seconds in his specialist K1 1000m event.

Fouhy said when he was asked to come back to the sport by CRNZ, one of his requirements was that he had to work outside the CRNZ programme.

"I wish it didn't have to be the case but it was a fact of life," he said.

"There was too many obstacles within that environment for me to be an effective athlete.

"[But] the first sign of heat from the media and they [SPARC] turned 180 degrees on that agreement.

"You have to stand by your athlete.

"They didn't.

"They stood by and watched me get battered in the media for three months and then decided it was easier for them to renege on their deal."

Fouhy had switched to flat water kayaking in 2002 after a background in multisport events.

He burst onto the world stage a year later by winning World Championship gold and his career high followed in 2004 at Athens.

He set a K1 1000m world record time in 2006 that still stands but his career as sputtered since.

He was surprisingly competitive in reaching the 2008 Olympic final - a race won by Brabants - but crashed out in last year's World Championships as controversy continued over his relationship with Ferguson and MacDonald, who subsequently lost their jobs at CRNZ.

"It has been an unpleasant time for me and my family," said Fouhy.

"It's been horrible.

"People might say, 'You're a tough athlete, that sort of thing shouldn't bother you', but it does.

"It might sound melodramatic but it eats away at you.

"It grinds you down.

"You can't enjoy your sport under those circumstances.

"Ian Ferguson has ground me down."