Britain considers dramatic visa fee hike to plug a 50 million pound gap in its budget

LONDON: The UK plans to significantly increase visa fees to plug a 50 million pound gap in its budget, a move that can hit Prime Minister David Cameron's efforts to boost student and business visits from countries like India.

The proposal for an across-the-board rise in visa fees is contained in a letter from a Home Office official circulated in the corridors of power here, The Times reported today.

According to the newspaper, the move is aimed at plugging a 50-million pound hole in the Home Office budget and could mean a hike in visa fees by 4 per cent, more than double the rate of inflation.

The move could put the Home Office in a direct clash with Prime Minister David Cameron's efforts to boost student and business visits to Britain from countries like India and China.

Cameron has already announced premium fast-track visa services for elite travellers from these two fast developing countries as part of his trade drive.

The move comes weeks after Home Secretary Theresa May was forced to back down on compulsory 3,000 pound visa bonds for select countries, including India.

A Home Office spokesperson said: "Visa fees are increasing because we are reducing the cost of the immigration system to the taxpayer. Immigrants and visitors should contribute their fair share to the system.

"The Home Office -- like the government overall -- is performing well in cutting spending while protecting and improving services."