The Home Secretary has praised Nigel Farage in a speech unveiling his plans to combat extremism.
Sajid Javid said "credit" was due to the Brexit Party leader for stepping away from UKIP.
"I applaud Nigel Farage for walking away, calling UKIP 'thugs and extremists'," he said.
"Even though his Brexit Party has not made my life any easier, I want to be clear - they are not extremists."
Responding to his comments, Mr Farage tweeted: "So there is some decency left in politics."
Under Mr Javid's plans announced today, organisations deemed “incompatible with British values” will be unable to sponsor migrant workers.
He said the controversial London-based advocacy group CAGE seeks to “divide us” and he plans to revoke its sponsorship licence.
The group says it is campaigning for an “end to the war on terror”.
Mr Javid continued: “I have amended the guidance for sponsoring migrant workers. This will allow us to refuse or revoke sponsor licences when an organisation behaves in a way which is incompatible with British values.
“I will do all I can to ensure groups like CAGE are not trusted with the privilege of sponsorship.”
Responding to the news, CAGE spokesman Cerie Bullivant said: “Sajid Javid's gratuitous mention of CAGE is an opportunistic deflection and dog whistle.”
“Only yesterday his government enshrined impunity for torturers while CAGE represents and demands justice for the survivors of this abuse.”
The speech is seen as a sign he expects to continue as Home Secretary after the new Prime Minister is appointed next week.