David Cameron to lobby for support on migration restrictions at EU summit in Lithuania

PM sets out moves to overhaul welfare rules, including stopping new EU arrivals from receiving out-of-work benefits

David Cameron’s emergency response to fears of a looming influx of Romanians and Bulgarians came under fire in Brussels on Wednesday – but failed to placate Tory backbench critics who demanded more draconian restrictions.

The Prime Minister set out moves to overhaul welfare rules, including stopping new EU arrivals from receiving out-of-work benefits for their first three months in Britain and making it harder for them to qualify for state support.

He also pledged that rough sleepers from the EU would be deported and banned from returning to Britain within 12 months.

The moves follow concerns fuelled by the UK Independence Party, and shared by many on the Tory right, that tens of thousands of Romanians and Bulgarians would head to Britain after restrictions on working in the UK are lifted on 1 January 2014.

Mr Cameron said the clampdown would send a clear signal to potential migrants that Britain was not a “soft touch”.

But his proposals were condemned as an “unfortunate over-reaction” by Laszlo Andor, the European Employment Commissioner, who warned that the move risked “presenting the UK as the kind of nasty country in the European Union”.

Viviane Reding, the Justice Commissioner, said she did not understand the “political logic” of the moves, given that the Government has been a keen supporter of EU enlargement and British citizens take full advantage of freedom of movement, setting up homes and businesses overseas. “Free movement is a fundamental pillar of the single market and the single market is something Britain has signed up to and is very dear to the heart of Great Britain,” she said.

Britain insisted the plans were legally water-tight within EU law, although the European Commission said it would reserve judgement until it had studied the proposals in greater detail.

The Government was buoyed up last night by the disclosure that the new governing coalition formed by Angela Merkel in Germany had committed itself to “reducing incentives for migration” by amending its domestic laws on welfare. Downing Street said the development proved that Mr Cameron’s initiative was gaining wide support across the EU.

President François Hollande’s government in France also called for tighter restrictions on EU migrants and Britain says its stance is also being backed by the Netherlands and Austria.

At an EU summit in Lithuania today, Mr Cameron will lobby other leaders for their support in limiting the right to freedom of movement, to prevent huge shifts of population across the union in future.

His plans were not enough to stop a succession of Conservative MPs calling for controls on Romanian and Bulgarian migrants to be extended for another five years.

Any such move would fall foul of courts both in Britain and Europe, but Eurosceptics urged ministers to defy EU law and maintain the controls. More than 40 Tory MPs have publicly backed the move.

Philip Hollobone, MP for Kettering, said: “My constituents take the view that this country is full and we should not open our borders to Romania and Bulgaria.

“Yes, this country will be taken to court, but it will be a signal of firm intent about our renegotiation of the EU treaties and by the time it comes to court hopefully we will have had our referendum and left this wretched organisation altogether.”

Meanwhile, Boris Johnson, the London Mayor, claimed last night that Baroness Thatcher would have supported Britain remaining in the EU if she were still in office.

“I don’t think she would pull out of the single market that she helped to create,” he argued in the third Margaret Thatcher lecture.

“I think she would recognise there is a chance to get a better deal. It’s time to sort out the immigration system so that we end the madness.”