LONDON (Reuters) - British Prime Minister David Cameron is prepared to drop a demand to curb welfare benefits for migrant workers as he attempts to renegotiate the terms of Britain's membership of the European Union, two British newspapers reported on Saturday.
The demand that European migrant workers wait four years before claiming state benefits has so far been presented as a central plank of the new deal Cameron is seeking to clinch ahead of a referendum on whether to stay in the bloc or leave.
Seen as a way to reduce Britain's attractiveness to migrants from poorer EU members in eastern Europe, a major domestic political issue in Britain, the welfare demand has been one of the biggest stumbling blocks in the renegotiation process.
Citing government sources, the Telegraph and Independent newspapers reported that Cameron would tell fellow EU leaders in Brussels on Thursday that he was prepared to drop the plan if they agreed on alternative measures to help reduce immigration.
A spokeswoman for Cameron's Downing Street office said she had no immediate comment and was looking into the reports.
Dropping the demand, which has received extensive coverage in the British media, would be seen as an embarrassing climbdown and would likely antagonize the large and vocal eurosceptic wing of Cameron's Conservative Party.
The opposition Labour Party was quick to react to the unconfirmed reports, saying Cameron had been "undone" by a failure to build alliances and goodwill in Europe.
"He chose to make benefits the centerpiece of his renegotiation, but it was never a good idea to reduce the whole future of our cooperation with Europe, and the jobs, investment, growth, security and influence it has brought us, to just this issue," said Hilary Benn, Labour's foreign affairs spokesman.
He called on Cameron to "make the broader case" for remaining in Europe.
Both newspapers said that Cameron would tell fellow leaders at a European Council meeting in Brussels on Dec. 17-18 that the contentious proposal would remain "on the table" until a better alternative was found to address the immigration issue.
"What matters most is to fix the problems, not the precise form of the arrangements," the Telegraph quoted a Downing Street source as saying.
On a tour of several eastern European countries this week as part of his renegotiation drive, Cameron found that his proposal on welfare was the most problematic issue for fellow heads of government.
After meeting with Cameron in Warsaw, Polish Prime Minister Beata Szydlo said they had not reached full agreement on certain issues, singling out the welfare benefits proposal.
Poland has been one of the main beneficiaries of the EU's principle of free movement since it became a member in 2004. Tens of thousands of Poles live and work in Britain.
Cameron has promised to hold a referendum on whether Britain should remain in the EU or exit the bloc by the end of 2017, although it could take place much earlier than that. He has said his preference would be to remain in a reformed EU.
A British vote to quit the EU, the so-called "Brexit" scenario, would shake the 28-member bloc to its core, depriving it of its second-biggest economy and most important financial center.
Reporting by Estelle Shirbon; Editing by Sandra Maler