So actually looking at Schedule 11 in the return tab answered my questions. Ufile is not clear what's happening. All they will say is that they reduced your credits claimed for interest on student loans, so you can carry them forward (even if its expiring).
What is really happening here is that it is a limitation of the Schedule 11 form and it rules for calculating the education amounts to be applied as tax credits. The calculation tells you add all the already applied credits lines 79 to 93, however the student loan interest credit is line 94 so applying any of those credits is wasted until the education amounts are exhausted.
This isn't a problem with UFILE but with the tax form, however UFILE should be more clear about why and how the credits are being applied and the help section does not explain this issue.