Shabana Mahmood said she is considering “a big increase” in payments for migrants to return voluntarily to their home countries.
Under current rules, the UK offers payments of up to £3,000 for some people with no right to remain in the country to return home.
The Home Secretary has directed officials to “pilot a small programme” of increased payments, “just to see how it changes behaviour”.
The Birmingham Ladywood MP has insisted the policy represents “value for money” but admitted it “sticks in the craw” for Britain’s hard-pressed taxpayers.
In plans to overhaul the asylum system set out on Monday, Ms Mahmood said the offer of financial packages to assist with voluntary returns would continue.
But she has now said the figures involved could increase.
She told the BBC’s Political Thinking podcast: “I haven’t alighted on the full sums involved yet, but I am willing to consider a big increase on what we currently pay.
“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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Most Britons think Labour is handling economy ‘badly’ according to damning new poll
The majority of people said the Government was managing the economy badly
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YOU GOV/PA
A new poll has shown the majority of Britons believe the Government is managing the economy badly in the latest blow to Rachel Reeves ahead of the Budget.
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The Covid inquiry will publish its findings today on decisions made by Boris Johnson during the pandemic
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PA
The UK Covid-19 Inquiry will publish its findings today into decisions made by former prime minister Boris Johnson and his senior advisers.
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