The committee was set up last year in answer to President Xi Jinping’s demands for financial stability and security. Its mission is to clean up a financial sector riddled with rampant rent-seeking, collusion between regulators and business, and other irregularities that fall through the cracks of the fragmented regulatory system.

The first meeting was convened in November by Ma Kai, a vice-premier who is set to retire in March. The committee declared it would supervise monetary policy and financial regulation, guide local authorities on financial matters and question the regulators and local Communist Party officials if it suspected any wrongdoing. But since then, little information has been given on its progress.

Xu said that in order to achieve the goal of reform, “material consolidation of business lines” was needed so that the committee could function better. He was referring to the way the central bank and the banking, securities and insurance watchdogs communicate – a system introduced in 2013 that has proven toothless in addressing financial risks.

Under the existing “vertical” structure, the committee oversees the PBOC, the China Banking Regulatory Commission, the China Securities Regulatory Commission, the China Insurance Regulatory Commission and the State Administration of Foreign Exchange.

But Xu called for “several professional commissions” to be set up under the committee that would be in charge of a “horizontal” approach to cross-sector information sharing, decision-making, coordination and implementation.

“This type of matrix structure was first used in international corporations such as Goldman Sachs in the 1950s … they are also widely used in multilateral international organisations – for example, the Financial Stability Board,” he said.

Gary Liu Shengjun, researcher and president of the China Financial Reform Institute in Shanghai, said Xu’s proposal was intended to empower the committee, in which central bank officials are expected to play an important role.

“By making ‘professional commission’ heads report to it, the committee would then become a super regulatory body with concentrated power,” Liu said.

“However, its effectiveness will depend on the charisma of the committee head and how each commission is motivated to work with the committee.

“It’s still a conservative approach to reform of the financial sector,” he said, comparing it to more sweeping changes such as disbanding and merging agencies and improving the legal framework.

The authorities have had discussions about merging the insurance and banking regulators, or even merging some functions of the securities watchdog with insurance and banking, according to academic sources.

The three regulators could not be reached for comment.

China’s insurance regulator has been without a chairman for more than 10 months since its former boss Xiang Junbo was sacked and placed under criminal investigation last year, accused of issuing operating licences to favoured insurers.

The vacancy has fuelled speculation about how the financial sector reform will take shape, and who will head up the key agencies involved – questions that are likely to be answered by March, if not before.

Liu He, Xi’s top economic aide, is likely to succeed Ma as head of the financial committee next month. Liu secured a seat on the 25-member Politburo during a reshuffle in October, creating the opportunity for him to be elected a vice-premier – meaning he could take the helm of the committee – at the annual meeting of the legislature in March.

“The dust won’t settle until Liu He is in charge,” Liu, the researcher, said.