Theresa May and Philip Hammond at odds after Downing Street dismisses reform of immigration data

Number 10 categorically rules out a review of students' inclusion in immigration numbers

As Home Secretary, Ms May fought to keep the number of foreign students counted within net migration statistics

Tension between Theresa May and her Chancellor Philip Hammond has heightened after Downing Street dismissed the idea of removing foreign students from immigration statistics.

Mr Hammond had indicated support for the reform of how immigrant numbers are recorded, despite Ms May having doggedly fought it for years.

But Downing Street was forced to categorically rule out any such change, after a government spokesman initially suggested it might happen as part of a wider rethink of immigration policy.

The issue now threatens to become a flashpoint in the struggle within cabinet to determine the nature of the UK’s withdrawal from the European Union.

A No10 spokesman said: "The government objective is to reduce annual net migration to the tens of thousands, and in order to deliver this we are keeping all visa routes under review.

"Our position on who is included in the figures has not changed, and we are categorically not reviewing whether or not students are included."

Hours earlier another spokesperson had explained that “the issue of migration, migrant numbers, who enters the country and under what terms, is very much subject for review” during Brexit negotiations.

Asked specifically if the issue of foreign students being counted as immigrants is being reviewed, the spokesperson answered: “The whole issue of migration is subject to review, yes.”

Yesterday, Mr Hammond also indicated that he thought students should not be counted in net migration figures at a Select Committee hearing in Westminster.

The Chancellor said it is essential that immigration controls are introduced in a way that “protects our economy”.

When asked if students should still be counted among immigrant numbers, he said: “My view is this is a question of public perception and the public’s view. Clearly immigration and the level of net migration is an issue of concern.

“The question we should be asking is, ‘what does the public understand should be included within that definition?’. It’s not whether politicians think one thing or another, it’s whether the public believe it.”

When committee chair Andrew Tyrie cited research showing only a fifth of people think students count as immigrants and that 59 per cent are opposed to efforts to reduce their number, Mr Hammond said: “I think that’s very interesting information.”

As Home Secretary, Ms May fought and won a battle with the then-Chancellor George Osborne to keep the number of foreign students counted within net migration statistics.

At the Conservative conference earlier this month, her new Home Secretary Amber Rudd also announced a broad crackdown on immigration with student visas particularly targeted.

But many ministers and universities have consistently argued that students should not be classified as immigrants.

Liberal Democrat Education Spokesperson John Pugh said: “Theresa May’s stubborn refusal to change tack risks doing serious damage to Britain’s economy and global reputation.

“Stopping talented overseas students coming to study in the UK does nothing to address concerns over migration, it just undermines our world-leading universities.”