The warnings come in responses to the Department for Business, Innovation and Skills' "technical consultation" on how universities should be regulated under the new system of higher tuition fees and loans.

Under the proposals in the consultation, which closed on October, the Higher Education Funding Council for England would be given beefed-up powers to act on behalf of students as the sector's "lead regulator". But mission groups and Universities UK have raised concerns over the resulting relationship between Hefce, the Quality Assurance Agency and the Office of the Independent Adjudicator.

Pam Tatlow, chief executive of Million+, told Times Higher Education that student complaints should be left to the OIA and ministers should refrain from making Hefce an "Ofwat"-style consumer regulator.

"Proposals to give Hefce, the OIA and the QAA roles in resolving student complaints are a recipe for confusion," she said.

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In submissions to the consultation, UUK says that the different agencies' roles are not sufficiently well defined in the proposals, while the 1994 Group warns of potential "conflicts of interest within Hefce that will interfere with its ability to perform its role".

Others suggest that Hefce's governance structure would need to be overhauled if the plans were realised, especially since it would oversee elements of the private sector.

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Nigel Savage, chief executive of the College of Law, told THE that it may no longer be feasible to have vice-chancellors making up a large part of the Hefce board, for example.

Meanwhile, there was also disquiet about proposals to allow non-teaching organisations to acquire degree-awarding powers. Ms Tatlow said this would "undermine...the importance of the institutional academic community", while UUK's submission calls for extreme care to be taken over any such move.

Carl Lygo, head of for-profit provider BPP, told THE he was also wary given the recent scandal involving the University of Wales.

simon.baker@tsleducation.com.