High Peak Liberal DemocratsOver-inflated figures on the number of international students over-staying their visas in the UK were put out on Theresa May's watch, the Lib Dems say.
Latest migration figures show just 4,600 students failed to leave the country when they should have last year, with samples showing 97% left on time.
The official statistics equate to less than a twentieth of previous estimates of 100,000, which led the prime minister to promise to clamp down on the situation when she was home secretary.
Lib Dem leader Vince Cable said the government should now take stock of the confirmed figures and reassess its position.
"This debacle happened on Theresa May's watch at the Home Office," he said.
"I spent five years in coalition battling her department's bogus figures on this issue but she responded by erecting a wall of visa restrictions on an entirely false basis.
"Cabinet Brexiteers fought a referendum campaign on a flawed prospectus, scapegoating foreign students who weren't even here, and demonising EU citizens who are now leaving the country voluntarily."
Home secretary Amber Rudd yesterday promised the effects of foreign students on the UK would be reviewed, after ministers demanded "robust" evidence of their value.
Cable added: "No wonder the government has announced a review into the impact of foreign students because its economically disastrous policy was based on figures that were out by 96%.
"As we argued repeatedly with Theresa May, overseas students bring huge economic benefits to universities and the broader economy. It makes no sense for students to be included in official immigration statistics.
"Higher education is one of Britain's most successful export industries, we must not let it be destroyed by the Conservatives' short-sighted obsession with immigration targets based on spectacularly wrong data."
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