Prime Minister Sir Keir Starmer has ruled out devolving migration powers to Holyrood, despite indications from a Labour backbencher that the government was warming to the idea.

Scottish government ministers have called for more flexibility in their ability to manage skills and labour shortages, including a visa system.

John Grady, the Labour MP who represents Glasgow East, told a debate in Westminster Hall last month that the Home Secretary Yvette Cooper was open to discussions and that “the migration advisory committee is looking at the issue carefully.”

Trade groups such as Salmon Scotland while Scottish Financial Enterprise  have called for reform of the immigration system.

However, a government source later denied there were any such plans and during a visit to Glasgow yesterday, Sir Keir was asked if his government was considering such a change. He replied: “No, we’re not looking at that.”

His decision will be seen as a setback to his promise to “reset” the relationship between the governments at Holyrood and Westminster. It is thought the visa had been on the agenda during early discussions between the Prime Minister and First Minister.

Kate Forbes, the Deputy First Minister, has called for a rural visa to help attract workers who will be needed for major renewables projects in the Highlands.

She has described the refusal of every Westminster party to consider devolving migration to Holyrood as “unforgivable”.

At the interpol gathering in Glasgow, Sir Keir pledged that the UK government would “treat people smugglers like terrorists” and announced a further £75 million for his Border Security Command, doubling spending to a total of £150 million over the next two years.