There is a "political blight" in UK market regulation that has cast uncertainty on the role of the Financial Services Authority, because of the starkly differing views of the Labour Government and the opposition Conservative party, the head of a regulatory practice has said.

John Tattersall, a consultant at PwC and the former chairman of the firm's UK financial services regulatory practice, said there was a worry that the FSA may have trouble hiring and that Chancellor Alistair Darling's paper on financial market reform, which was published yesterday, may prove to be a waste of resources because of the starkly contrasting views of the opposition party.