To allow people born between 2 October 2000- 29 April 2006, in the UK to EU nationals, to be considered British. And allow for these parents to use treaty rights and Permanent residence status instead of Indefinite leave to remain, which many EU nationals aren’t required to apply.
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Under British Nationality Act 1981, those born after 30 April 2006 to European parents in the UK, having exercised Treaty Rights (Permanent residence stays), are automatically British.
However children born to EU nationals in the UK between 2 October 2000- 29 April 2006, are not! For parents of these children exercising treaty rights can’t be used as proof of Permanent residence status. The majority of EU nationals aren’t required to apply for Indefinite Leave to remain so are unable to prove permanent status in any other way.