UK Taxpayers Are Funding £4 Billion a Year in Student Loans for Foreign Nationals

The numbers are not in dispute. Foreign nationals studying in the UK borrowed more than £4 billion in taxpayer-funded student loans in 2024–25 — up from £3.2 billion in 2021–22. Suella Braverman and Reform UK are now making it a central political issue, framing it as universities exploiting an immigration-adjacent subsidy at the British public’s expense.

What the Data Shows

The figures were obtained through a Freedom of Information request by The Telegraph. The £4 billion figure covers tuition and maintenance loans to undergraduates — part-time and full-time — as well as postgraduate master’s and doctoral loans, across England, Wales, and Northern Ireland. The amount loaned to non-UK, non-EU nationals has risen sharply in the past four years.

The repayment picture compounds the concern. Only 56% of all full-time undergraduate loans — including those taken by British nationals — are projected to be repaid in full. Student loans are written off after 30 years for those who started before 2023, meaning a substantial portion of foreign-student loans will never be recovered. For students who return to their home countries after graduation, collection becomes even more difficult.

The Political Argument

Reform UK deputy leader Richard Tice has called the scale of payments to foreign students “madness,” arguing that restricting loans to British nationals would “save billions.” Braverman’s framing goes further — that universities are not primarily offering education to international students but are using course enrollment as a mechanism to channel immigration, with student loans as a publicly funded enabler.

The charge has some structural basis. International students generate significant fee revenue for UK universities, which have become financially dependent on that income stream. The incentive to recruit foreign students is not purely academic. When that recruitment is subsidized by government-backed loans, the line between higher education policy and immigration policy blurs considerably.

The Government’s Position

The current Labour government has defended the system by arguing that loan eligibility requires settled status or a recognized connection to the UK, targeting support at students likely to contribute to the economy. Critics note this framing sidesteps the core question of whether British taxpayers should be financing the higher education of foreign nationals at all, particularly when repayment enforcement for those who leave the country is weak.

Conservative MPs have also weighed in. Bob Blackman called for home students to be prioritized outright: foreign students, he argued, are welcome — but they must be able to pay their own way. Shadow business minister Harriett Baldwin suggested the figure represents a straightforward area for spending restraint that the government has chosen to ignore.

The Broader Context

The outstanding total value of UK student loans reached £267 billion by the end of March 2025. The system is, by OECD measures, the largest average loan burden of any country surveyed. Reform UK’s position — that the British taxpayer should not be the lender of first resort for foreign nationals seeking a UK degree — is set to become a more prominent dividing line as the party consolidates its position in the political landscape.

Whether the argument lands as fiscal responsibility or as an immigration-by-other-means debate will depend on how universities and the government choose to respond. So far, neither has offered a compelling answer to the basic question Braverman is raising: why is this the British taxpayer’s obligation?