The BBC has come under fire recently for paying seven-figure salaries to presenters such as Jonathan Ross, Graham Norton and Terry Wogan at a time when it is cutting 2,500 jobs and laying off 1,800 employees to save money, the newspaper said.
In a speech to the Royal Television Society in London Thursday, Michael Lyons expressed "a real concern" that the BBC is too quick to meet salary demands that reflect "U.S. realities rather than domestic concerns."
"It is important that the BBC does not use the privilege of a guaranteed income to overbid for talent, thereby raising costs for the industry as a whole and reducing the value delivered to license-fee payers," Lyons said.
Lyons said he ordered a report analyzing the corporation's spending on talent.
Mark Thompson, the BBC director general, however, has repeatedly suggested BBC stars are worth their high salaries.
"The number of individuals we pay large sums to is very small," Thompson said. "The public want the best entertainment and are impatient if we do not give it to them."
2014: The Year in Music [PHOTOS]