PRA chief executive Andrew Bailey was named yesterday as the new chief executive of the FCA, succeeding Martin Wheatley.

Andrew Tyrie said the Treasury Committee, of which he is chairman, should have powers to block appointments or sackings of key management figures at the regulators.

He said: “The FCA has been in difficulties, and on many fronts. It has a tough job ahead, and will require high quality leadership.

“Allegations have been made that the FCA has been vulnerable to political pressure, influencing the way that it approaches the fulfilment of its statutory obligations. Whatever the substance of these allegations, and there may be none, the perception of them may remain.

“It is partly the need to address these concerns, and to entrench the FCA’s independence, that has led the committee to conclude that it requires a veto on both the appointment and the dismissal of the FCA’s senior leadership.

“A similar arrangement is already in place for the OBR’s leadership. It provides a useful precedent. It has given the OBR demonstrable operational independence, and has contributed to its early success. It should be extended to the FCA and – following today’s news that there is now a further position to fill – to the PRA, too.”

He did back the appointment of Mr Bailey, however, saying he had “done a good job of creating the PRA out of the ashes of the FSA, whose shortcomings were so heavily exposed by the financial crisis of 2008”.

He said: “As the leader of one half of the UK’s ‘twin peaks’ regulatory system, Mr Bailey has extensive experience of implementing the recommendations of the Vickers and Parliamentary Banking Standards Commissions. There is more work to do on both. Mr Bailey will now have the tough job of protecting consumers and markets, and bolstering competition, in an increasingly complex financial services sector.”

Mr Bailey assumed the role of Deputy Governor for Prudential Regulation and chief executive of the Prudential Regulation Authority in April 2013.