The proposals contained in 'Students at the Heart of the System' cover four broad areas: reforming funding; delivering a better student experience; enabling universities to increase social mobility; and reducing regulation and removing barriers for new providers.
The Higher Education White Paper published on Tuesday will also ask Sir Tim Wilson to undertake a review into how university-industry collaboration can excel. The review will look at how the decline in sandwich courses can be reversed.
The White Paper comes as part of the wider Government agenda to put more power in the hands of the consumer. The Government has launched a major programme for public sector modernisation by cutting waste and bringing choice, encouraging competition and opening the market up to new providers. For higher education, this means that in future funding will follow the choices of the student.
Secretary of state for business, innovation and skills, Vince Cable, said: "Our university sector has a strong history with some world-class institutions attracting students from across the globe. Higher Education is a successful public-private partnership; combining Government funding with institutional autonomy.
"This white paper builds on that record, while doing more than ever to put students in the driving seat. We want to see more investment, greater diversity, including innovative forms of delivery from further education colleges and others, and less centralised control over student numbers. But, in return, we want to the sector to be more accountable to students, as well as to the taxpayer."
Katja Hall, CBI chief policy director, added: "As tuition fees rise, it's only right that students are in the driving seat, able to make much more informed decisions about what degree to take and where to study it.
"Under these plans, students would have much better information about the jobs and salaries they could achieve, having graduated in a particular course from a particular university. There will also be a need for employers to say what skills they need in the future and what the career prospects are for different qualifications.
"The result will be a system in which universities compete more rigorously for students, and offer more innovative ways of learning.
"However, the Government must ensure that universities continue to offer courses that provide much-needed skills for the economy, in particular more expensive ones to deliver such as science, technology and engineering."