Shabana Mahmood is considering ‘a big increase’ in payments for migrants to return voluntarily to their home countries that would be ‘value for money’ for taxpayers.

The Home Secretary set out plans to overhaul the asylum system on Monday, during which she said the offer of financial packages to encourage arrivals to go home voluntarily would continue.

The UK currently offers payments of up to £3,000 for some people with no right to remain in the country who agree to return home.

But, Ms Mahmood admitted this could be raised further, adding the Home Office will start trialling ‘increased incentive payments’ to encourage migrants to leave.

And she has already directed officials to ‘pilot a small programme’ of increased payments ‘just to see how it changes behaviour’.

‘I haven’t alighted on the full sums involved yet, but I am willing to consider a big increase on what we currently pay,’ she told BBC‘s Political Thinking podcast.

‘I know it sticks in the craw of many people and they don’t like it, but it is value for money, it does work, and a voluntary return is often the very best way to get people to return to their home country as quickly as possible.’

Labour backbenchers have strongly criticised Ms Mahmood’s wide-ranging reforms, which are aimed at deterring migrants from seeking asylum in the UK and making it easier to remove people with no right to be in the country.

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Shabana Mahmood (pictured) is considering ‘a big increase’ in payments for migrants to return voluntarily to their home countries

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A group of people thought to be migrants are brought in to Dover onboard a Border Force vessel earlier this month

MPs lined up to attack the ‘dystopian’ reforms, with several indicating they will rebel to block the changes.

Former frontbencher Richard Burgon accused ministers of ‘scraping the bottom of the barrel’, branded the plans a ‘desperate attempt to triangulate with Reform’ and predicted ministers would U-turn on the plans within months.

Fellow Left-winger Nadia Whittome said it was ‘shameful’ that Labour was adopting ‘such obviously cruel policies’.

But the rebellion looked set to spread beyond the Left of the party, with a broad range of Labour MPs speaking out, exposing a schism in Sir Keir Starmer’s Government barely a week from Budget day.

A full-scale Labour backbench rebellion over the plans could lead to humiliation for Sir Keir if he is forced to rely on Tory support, as promised by Kemi Badenoch, to push them through.

Other measures in Ms Mahmood’s plan include making refugee status temporary with reviews every two and a half years, and the possibility of it not being renewed.

Speaking in the House of Commons on Monday, Ms Mahmood said the current asylum system ‘feels out of control and unfair’.

The Home Secretary told MPs the ‘uncomfortable truth’ that the UK’s generosity draws migrants to its shores must be accepted.

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The Home Secretary set out plans to overhaul the asylum system on Monday

She said: ‘While asylum claims fall across Europe, they are rising here, and that is because of the comparative generosity of our asylum offer, when compared to so many of our European neighbours.

‘This generosity is a factor that draws people to these shores on a path that runs through other safe countries.’

Conservative leader Kemi Badenoch, responding to Ms Mahmood in the Commons, offered to ‘work together’ with Labour to tackle the small boats crisis in the Channel.

‘It’s not enough, but it is a start,’ Mrs Badenoch said of the plans announced on Monday.

‘I want to praise the Home Secretary. She is bringing a new energy to the job.’

But the Tory leader warned that any plan that doesn’t involve Britain quitting the European Convension on Human Rights (ECHR) is ‘wasting time’.

‘Just like their plan to smash the gangs, or the ‘one in one out’ policy, it is time wasting, and it is doomed to fail because of lawfare,’ Mrs Badenoch added.