Theresa May, the Home Secretary, is to press ahead with moves to impose an annual cap on migration amid disquiet among Cabinet colleagues over its impact on the economy.
The plan for a yearly limit on visas issued to non-European Union workers was a key feature of the Conservative manifesto and was credited with winning over many undecided voters to the party.
Both Michael Gove, the Education Secretary, and David Willetts, the minister for universities and science, have privately warned that too rigid a formula could undermine Britain’s appeal to foreign business leaders and overseas students. Their anxieties are shared by influential voices in the City, industry and higher education.
Liberal Democrat members of the coalition administration are also hostile to the move, which was denounced by Nick Clegg, the Deputy Prime Minister, during the election campaign.
Mrs May will next week set out plans to consult on the cap plan, which could include a degree of flexibility on the scheme.
But both Downing Street and the Home Office insisted yesterday there would be no compromise on its fundamental principles.
A Downing Street spokeswoman said: “The coalition agreement makes it very clear what the policy is and what it is trying to achieve. The policy hasn’t changed.”
Home Office sources said the government recognised the need to attract “the brightest and the best” to Britain, but added that the public strongly supported the plans for a yearly cap.