Greg Dyke believes it is "pretty depressing" that Manchester City are poised to win the Premier League on Sunday with only two English players regularly in their starting lineup.

The FA chairman, who has sparked widespread opposition to his proposal for top-flight clubs to operate B teams in the lower divisions, said the scarcity of English talent at Manchester City – who will claim the title if they win or draw against West Ham – and Chelsea highlighted the problems his controversial FA commission report was attempting to address.

"It's been a great league this year," Dyke said. "I think the Premiership has been brilliant. But I think there are probably two [regular] England players playing at City [Joe Hart and James Milner], and two or three at Chelsea [John Terry, Gary Cahill and Frank Lampard], although there won't be that many next year – that's pretty depressing.

"I think the figures that we produced, that the top four clubs last year averaged 29% English players starting last year, down to 23% this year, I think we should be worried about that."

Although he praised Brendan Rodgers for bringing through "three, four, five" English players at Liverpool, Dyke said football's wider structural problems would remain without drastic action to bring more players through the system.

"What do they [owners] care about? A lot of them, because they're spending a lot of money on academy programmes, are saying: 'But hang on, what am I getting back for this?'" he said. "When Chelsea have not had a player out of their academy and into their first team consistently since John Terry you wonder, well, hang on, this is probably the most expensive academy in Britain."

Despite opposition from the Premier League, the Football League, the Football Conference and fan groups to the commission's conclusions, Dyke is determined to press ahead with his four-point plan, which also includes reform of the loan system and a tougher process for granting work permits to non-EU players. He said the introduction of a new loan system, allowing up to eight players to join a single club, and B teams would mean more flexibility in developing young talent. "Look at what happens in Spain, Germany, Holland. I always love England because it's so opposed to any change," said the former BBC director general and Brentford chairman. "And yet you have to say: 'Well, hang on, guys. We might have the best league in the world but we haven't got the best development programme in the world by any means.'"

Dyke confirmed that Premier League clubs would pay upwards of £1m per season to enter a B team in the Football League and claimed that in addition to Manchester United, Manchester City, Stoke City, Liverpool and Tottenham Hotspur there were "four or five" other clubs in favour.

The idea will require a two-thirds majority of the 20 Premier League clubs if it is to pass and the chief executive, Richard Scudamore, has made it clear he opposes the plan. The Commission's report will be discussed by the Premier League and the Football League at their summer meetings in July. Dyke accepted he would face opposition but said something had to change.

"But then you say to them 'OK, guys, but what are you going to do? If it's that easy, what are you going to do to get these kids through? It's all right sitting there saying we won't change anything," he said. "And in 15 years' time there are only 15 % of the players in the Premier League who are English and we haven't got an England team."