Donald Trump's hardline stance on immigration looks set to be drastically softened after it emerged he was considering allowing some undocumented migrants the right to stay in America.

Hours before the speech to US lawmakers, Mr Trump signalled he was willing to change direction on his policy towards undocumented migrants.

During a lunch with journalists, he said he was willing to "compromise" on a new immigration bill, which could include legalisation for some of the estimated 11 million people living in the US illegally.

Trump: 'I'd give myself an A for effort'

Reports suggested it could also lead to citizenship for the "Dreamers" — people brought to the US illegally as children.

During the speech to Congress, he said: "By finally enforcing our immigration laws, we will raise wages, help the unemployed, save billions of dollars and make our communities safer for everyone."

Mr Trump also used the address to call for a major increase in military spending, and outlined a plan he said would boost job growth while tightening border security.

His much-anticipated joint session address, which lasted for more than an hour, also touched on the thorny issue of how he plans to repeal and replace Obamacare.

The White House and Congress lack agreement on how to reform the US healthcare system, amid signs of growing Republican division on the issue.

He said: "Tonight, I'm also calling on this Congress to repeal and replace Obamacare with reforms that expand choice, increase access, lower cost and, at the same time, provide better health care.

"Mandating every American to pay government-approved health insurance was never the right solution for America.

"The way to make health insurance available to everyone is to lower the cost of health insurance, and that's what we'll do."

President Donald Trump (Getty Images) (Getty)

As speculation mounts that Mr Trump will call on congress to back a new immigration bill, a senior White House official confirmed the issue may be raised during Mr Trump’s address, but did not give details about what specific measures it would include.

The White House would not expand on Mr Trump's comments beyond spokeswoman Sarah Sanders saying that the president was "open to having conversations about that moving forward".

It follows a major setback for the Trump administration after moves aimed at restricting arrivals from seven Muslim-majority countries were blocked by a federal appeals court.

White House press secretary Sean Spicer said last week that the theme of the address would be “the renewal of the American spirit” and would focus on “public safety, including defence, increased border security, taking care of our veterans, and then economic opportunity, including education, job training, healthcare reform, jobs, and tax and regulatory reform”.

The controversial orders Donald Trump has already issued Show all 9 1 /9 The controversial orders Donald Trump has already issued The controversial orders Donald Trump has already issued Trump and the media White House Press Secretary Sean Spicer takes questions during the daily press briefing Getty Images The controversial orders Donald Trump has already issued Trump and the Trans-Pacific Partnership Union leaders applaud US President Donald Trump for signing an executive order withdrawing the US from the Trans-Pacific Partnership negotiations during a meeting in the Roosevelt Room of the White House in Washington DC. Mr Trump issued a presidential memorandum in January announcing that the US would withdraw from the trade deal Getty The controversial orders Donald Trump has already issued Trump and the Mexico wall A US Border Patrol vehicle sits waiting for illegal immigrants at a fence opening near the US-Mexico border near McAllen, Texas. The number of incoming immigrants has surged ahead of the upcoming Presidential inauguration of Donald Trump, who has pledged to build a wall along the US-Mexico border. A signature campaign promise, Mr Trump outlined his intention to build a border wall on the US-Mexico border days after taking office Getty Images The controversial orders Donald Trump has already issued Trump and abortion US President Donald Trump signs an executive order as Chief of Staff Reince Priebus looks on in the Oval Office of the White House. Mr Trump reinstated a ban on American financial aide being granted to non-governmental organizations that provide abortion counseling, provide abortion referrals, or advocate for abortion access outside of the United States Getty Images The controversial orders Donald Trump has already issued Trump and the Dakota Access pipeline Opponents of the Keystone XL and Dakota Access pipelines hold a rally as they protest US President Donald Trump's executive orders advancing their construction, at Columbus Circle in New York. US President Donald Trump signed executive orders reviving the construction of two controversial oil pipelines, but said the projects would be subject to renegotiation Getty Images The controversial orders Donald Trump has already issued Trump and 'Obamacare' Nancy Pelosi who is the minority leader of the House of Representatives speaks beside House Democrats at an event to protect the Affordable Care Act in Los Angeles, California. US President Donald Trump's effort to make good on his campaign promise to repeal and replace the healthcare law failed when Republicans failed to get enough votes. Mr Trump has promised to revisit the matter Getty Images The controversial orders Donald Trump has already issued Donald Trump and 'sanctuary cities' US President Donald Trump signed an executive order in January threatening to pull funding for so-called "sanctuary cities" if they do not comply with federal immigration law AP The controversial orders Donald Trump has already issued Trump and the travel ban US President Donald Trump has attempted twice to restrict travel into the United States from several predominantly Muslim countries. The first attempt, in February, was met with swift opposition from protesters who flocked to airports around the country. That travel ban was later blocked by the Ninth Circuit Court of Appeals. The second ban was blocked by a federal judge a day before it was scheduled to be implemented in mid-March SANDY HUFFAKER/AFP/Getty Images The controversial orders Donald Trump has already issued Trump and climate change US President Donald Trump sought to dismantle several of his predecessor's actions on climate change in March. His order instructed the Environmental Protection Agency to reevaluate the Clean Power Plan, which would cap power plant emissions Shannon Stapleton/Reuters

Among the others proposals unveiled by the Trump team on Tuesday was a plan to cut diplomacy and foreign aid budgets by 37 per cent to help pay for increased military spending.

Speaker of the House of Representatives, Paul Ryan, said the speech was "an opportunity for the people and their representatives to hear directly from our new President about his vision and our shared agenda".