The Prime Minister stood firm on immigration three weeks ago announcing those arriving once Britain has left the EU on March 29, 2019, should not have the same rights as those who came before.
But now reports suggest Downing Street is beginning to examine proposals to make a unilateral promise to EU citizens they can remain in the country if they arrive before the end of the transition period, which is expected to last two years.
Britain and the bloc have not yet agreed the official end-date to the transition period, with the EU proposing December 31, 2020, as the last day.
But Mrs May is planning to ask the EU for flexibility on the length of the Brexit transition period, and is refusing to put a timeframe on the process.
The Prime Minister’s surprising change of approach could be designed to ease tensions with Brussels to ensure that she seals a swift implementation deal.
But the move could leave Britons living in any of the EU’s member states with fewer rights than EU citizens residing in the UK, as there is no guarantee that Brussels will offer the same terms.
Senior minsters from the Cabinet’s Brexit sub-committee were in an eight-hour meeting at Chequers yesterday to hammer out their differences and agree on how close the UK’s relationship to Brussels should be post-Brexit.
The EU has made clear that preventing EU citizens who arrive after March next year from staying indefinitely would break freedom of movement rules, jeopardising any transition deal.
The revelation comes as the number of migrants returning home to Europe has soared since Britain voted to leave the EU in 2016.
Official data from the Office for National Statistics revealed yesterday that 90,000 people came to the UK from the bloc in the year to September 2017, a fall of 75,000 compared with the year before.
Supporters of a hard-Brexit have expressed anger at Britain repeatedly backing down in the face of the EU.
Leading Brexiteer and Conservative backbencher Jacob Rees-Mogg, said: “There has to be some difference on March 30 from March 29 otherwise we haven’t left.”
Top Government figures including Chancellor Philip Hammond, Business Secretary Greg Clark and Home Secretary Amber Rudd are desperate to ensure that Britain secures agreement for a transition deal at the next month’s EU council meeting.
Reports in The Times suggest work is being undertaken in Whitehall to prepare for the climbdown.
One source told the paper: “This is a big U-turn in the offing.”
Another source confirmed that planning was under way, saying: “That’s where thinking at the Brexit department now is.”
A Whitehall source said it would be dependent on discussions at the meeting of the Brexit sub-committee, and Mrs May’s final verdict.
The overall position of Britain after Brexit will be set out by the prime minister in a speech next week.