Mahmood, appearing before MPs at the Home Affairs Committee, said settlement in the UK is a “privilege not a right” and it would be “odd” for the UK not to seek to attract the “brightest and best” people to work in the country.
She told MPs: “I think at five years that’s actually quite a short period before people can be permanently settled in the country with all of the benefits that that brings.
“I think it’s right therefore that we extend it. And in the range of proposals that we’ve set out there are some things that could help you bring that qualifying period down.
“So if you’re a particularly high earner, you’ve come through on any of the global talent routes, you’re a higher band taxpayer, you can earn that period down from 10 years to potentially three.
“But then the reverse is true as well so if you do fall upon the state and you end up accessing benefits that can increase your qualifying period.”
The proposals include those people who arrived on post-Brexit health and social care visas having to wait 15 years.
Labour MP Dr Peter Prinsley highlighted the demand for care workers who are “not high earners but who are nevertheless extremely useful members of society”, adding: “We need to be able to attract people to come to work in those sectors.”
Bell Ribeiro-Addy noted there was “anxiety of retrospectivity” and added it was “causing a lot of issues”.
The Labour MP for Clapham and Brixton Hill asked what would happen if a person has the right to apply for settlement now but could not afford it until the new system came in.
Mahmood said an application is “assessed based on the rules that are in force at the point that the application is made”, adding this was not a new change.