THE Home Office is under growing pressure to sanction a separate graduate visa scheme in Scotland after MPs said current rules were damaging universities, businesses and the economy.

A report from Scottish Affairs Committee said that the health, energy and finance sectors were having particular challenges in recruiting skilled workers with the number of non-EU graduates remaining in the UK plummeting by 80 per cent since tougher immigration rules were brought in.

Previously, international graduates were able to remain for two years after completing their studies but the post-study work visa was scrapped by the Conservatives in 2012 over concerns the system was being abused as a part of a wider clampdown on immigration.

The Westminster committee, which is chaired by the SNP and includes four Conservatives and three Labour members, found the move had made Scotland less competitive in the global education market, with other nations able to offer prospective students greater employment opportunities after graduation. It said that it believed challenges to establishing a Scottish visa system, which could help plug skills gaps, could be overcome.

A Holyrood committee, which published its report on the same issue at the weekend, reached similar conclusions while Universities Scotland has warned that the current system has cost the economy £250 million since it was introduced.

Humza Yousaf, the SNP Minister for Europe and International Development, said the report heaped more pressure on the UK Government to take action.

He added: "As the committee has found, Scotland’s immigration needs are different to those of the rest of the UK. The Scottish Government believes that an improved post study work visa route would help to address these needs and would be an important economic lever of great benefit to Scotland.

"There is consensus in Scotland, in business, and in education, that we need a return of the post study route to allow talented students to remain and contribute to the Scottish economy."

David Mundell, the Scottish Secretary, has argued that existing visa schemes for non-EU students are "excellent" , a claim both the Westminster and Holyrood committees said was not backed up by evidence.

In March, a report by the Scottish Government’s post-study work group said students from outside Europe should be given special permission to stay and work in Scotland after their studies have finished and called for the reinstatement of the post-study work visa.

Representatives from academia, business, industry and trade unions in Scotland have spoken out about problems facing their sectors caused by restrictive visa regulations.

Pete Wishart, the SNP MP and chair of the Scottish Affairs Committee, said: "We currently have a situation where people come to Scotland from around the world to spend three or four years here being educated and becoming settled in our society. Then we raise unnecessary barriers preventing these talented individuals from staying and contributing to our economy.

"The Scottish government, education sector and business sectors have all indicated that they want to see changes to this situation. There has been an almost universal call for change and the UK government must give assurances that it will take heed and give proper consideration to reforms."

A UK Government spokesman welcomed the report but refused to commit to allowing changes to the system, despite reform being backed by all Holyrood parties including the Scottish Tories.

The committee said extending the length of time international graduates are given to find skilled work from the current four months should be investigated, along with altering a bureaucratic system to make it easier for businesses to take on former students. It also advocated consideration of regional salary thresholds. Currently, to be allowed to stay graduates must earn almost £21,000, although average salaries in Scotland are lower than some other parts of the UK.

The spokesman added: "We have been clear that we will examine any evidence which the committee, or other interested parties, might produce about the effectiveness of post study work schemes and any suggestions they have for further improvements."