Rachel Reeves is reportedly at odds with Yvette Cooper over European Union demands for a youth mobility scheme under a potential UK-EU "reset". The Chancellor favours relaxing visa rules for young Europeans, while the Home Secretary is believed to have argued against a scheme over fears of the impact on migration figures.

Brussels is pushing for such a scheme as part of reset of relations between the bloc and Britain, which the UK Government hopes will boost economic growth. Ms Cooper has argued against a scheme to allow young Europeans to stay in the UK more than 12 months due to concerns the arrivals will increase migration numbers, according to The Times.

A Home Office source told the publication the "priority is reducing net migration", with reports that Ms Cooper is lobbying for a cap on visas issued to youngsters from the bloc.

Ms Reeves, meanwhile, reportedly favours a scheme after studies showed it would help boost the economy. In February, the Institute of Directors joined a chorus of business calls for EU worker restrictions to be eased.

The EU had proposed allowing an uncapped number of 18 to 30-year-olds to come to the UK for up to four years. Prime Minister Sir Keir Starmer has previously ruled out the return of free movement with the EU amid concerns among voters about unchecked migration.

Ministers have said they want to improve the UK's relationship with the bloc on a range of matters, including trade, defence and border security.

Sir Keir said Europe needs to "step up" on both security and trade ahead of a meeting with the President of the European Commission later this week.

Ursula von der Leyen is due to meet Sir Keir in London on Thursday (April 24), a trip which comes just weeks before a full UK-EU summit planned for May 19.

Sir Keir said: "We want to reset our relations with Europe, to improve those relations.

"That's been brought into sharp focus in the last three or four months on the question of security and defence. We have to recognise we're moving into a new era where all Europeans need to step up on security and defence and that's the discussions we're having with the EU and others.

"I also think on trade and the economy that we need to step up and reset. And so those are the changes that I hope we can make in an important summit that will be a milestone in May."

Sir Keir is due to host Ms von der Leyen as well as President of the European Council Antonio Costa at the summit next month.

Announcing the meeting in February, Downing Street said it would be an "opportunity to make further progress on areas which will deliver tangible benefits for the people of the UK and EU and further strengthen the relationship between the UK and the EU".

It is expected to be the first in an annual series of meetings between UK and EU leaders.

Brussels has put a youth mobility scheme and fisheries at the top of its agenda while London had been aiming for reduced border checks through a new veterinary agreement.

Sir Keir has previously ruled out rejoining the EU single market or customs union as well as any return to freedom of movement.