Yvette Cooper is said to be "open" to a youth mobility scheme with the EU on a "one in one out" basis.
Sources told The Times the Home Secretary is now supportive in principle of the plan provided it would be "capped" to ensure that there could be zero return to pre-Brexit freedom of movement.
A Home Office source said: "Yvette’s primary objective is to reduce net migration and any discussion about visa schemes needs to be seen in that light. It needs very careful thought."
Cooper had reportedly argued internally against a scheme allowing Europeans to stay for more than 12 months because of fears the arrivals would inflate migration figures.
Labour considering allowing thousands of Europeans into Britain as part of 'one in one out' mobility scheme
PA
However, the "one in one out scheme" would limit the annual numbers of young EU students allowed to come to the UK to a proportion of young Britons travelling to Europe.
A Home Office spokesman told The Times: "These are matters for the Cabinet Office. No proposals have been put to the home secretary or suggested by her."
It comes after Sir Keir Starmer held talks with European Commission president Ursula von der Leyen before a critical summit next month, aiming to reset Britain’s post-Brexit relationship with the EU.
Reacting to the news, Conservative peer Ross Kempsell said: "You couldn’t make it up!"
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Environment Secretary Steve Reed dismissed the rumours as 'speculation'
PAThe German ambassador to the UK has said he is "really optimistic" about the prospects of a youth mobility scheme.
He told the BBC: "I am now pretty optimistic that we are moving in a good direction.
"It would make it possible for young people with parents with a lower income to experience the possibility to work abroad, to learn a language, and we would like to have this in both directions."
Miguel Berger, the German Ambassador to the UK
Getty
Environment secretary Steve Reed described the report in the Times as “speculation” and telling Times Radio: "We’re very clear in our manifesto that there won’t be any return to the single market, the customs union or freedom of movement, and that remains our position."
He also said that it is “right” to say there are no plans for a youth mobility scheme, adding: “We’re not going to breach our manifesto commitments.”
Labour’s 2024 general election manifesto said "there will be no return to the single market, the customs union, or freedom of movement."
Ministers have so far resisted calls for such a scheme but it is thought that it is something the EU is looking for as Number 10 pursues a "reset" in relations after Brexit.
