The Lib Dem leader said Boris Johnson should never have appointed Richard Sharp as chairman of the BBC, and Rishi Sunak should have shown leadership by sacking him.
Sir Ed Davey said the British public would be very angry at “another example of this government’s incompetence”.
He called for the cross-party Commons committee for culture, media and sport to be involved in an independent process for selecting the BBC chairman, rather than leaving the choice to the prime minister.
BBC chairman Richard Sharp resigns after Boris Johnson loan row