Graduates
The Office for Students will start its work in April. Getty

Universities in England are set to lose their autonomy when a new watchdog comes into force that will tackle excessive salaries for vice-chancellors.

The Office for Students (OfS) will start in April and is set to be a tougher arbiter for tertiary institutions than the Higher Education Funding Council for England it is replacing.

Documents seen by The Times show that the OfS will aim to hold institutions to account for students who pay an average of £9,250 a year in fees.

It will assess dropout rates as well as the quality of teaching and make sure universities act on grade inflation. It will also push for better opportunities for disadvantaged students.

But a key issue in its in-tray will be excessive pay for vice-chancellors who earn an average salary package of £268,000, with 13 paid at least £400,000 and 64 at least £300,000.

Universities soon need to justify such salaries in annual accounts and reveal how many staff will be on salaries above £100,000 above £150,000. They will also have set out the ratio of the university head's pay to the average salary of staff.

It comes as it emerged that vice-chancellors and senior staff claimed almost £8m in expenses over two years, including Surrey University paying £1,600 to relocate a vice-chancellor's dog from Australia.

Following a Freedom of Information (FoI) request, the investigation by Channel 4's Dispatches programme also found other claims including £1,300 for a work of art and £110 for a Fortnum & Mason hamper.

Nicola Dandridge, chief executive of the OfS, denied her organisation would impact on the autonomy of universities.

"You can't regulate for greatness. We will be focusing our attention on providers who are most likely to be in breach of any conditions," The Times reported.