A new points-based immigration system threatens to end a scheme under which Commonwealth citizens with a British grandparent are allowed to enter and settle in Britain.

The move will mainly affect people from Australia, New Zealand, Canada, South Africa and Zimbabwe who have used the “ancestral visa” scheme to come to Britain.

Under the historic visa scheme Commonwealth citizens who can prove that one grandparent was born in Britain are allowed to enter the country. They must also be prepared to work and keep themselves, without relying on the State. Crucially, after four years in Britain, they can apply for permanent settlement.

More than 60,000 Commonwealth citizens have entered Britain using the ancestral visa system in the past five years, and a smaller number has been allowed to settle permanently.

The disclosure that the future of the scheme is under consideration by the Home Office came after the issue was raised yesterday by the Commons Home Affairs Select Committee. A Home Office spokeswoman said that no decision had been taken.

She said: “We are consulting on the new points system for managed migration to cover routes to work, study and train in the UK. As we develop the new system we will consider how it relates to the existing routes, such as UK ancestry.”

More than 10,000 Commonwealth citizens were allowed to settle in the country in 2003 and 2004 on the basis that one of their grandparents was born in Britain.

The Government’s plans for a points-based migration system means that the focus will shift to attracting migrants to do key jobs.

This would close the door on low-skilled, non-EU workers settling in Britain. Only investors and skilled workers would be allowed to settle.

The new migration work scheme would have five tiers, with points linked to educational attainment and age. It is intended to replace the existing 50 ways that people can come to work and study in Britain.

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