Nick Clegg accuses Theresa May of ‘illegal’ plans to cap EU immigration

Leaked Home Office paper suggests lower-skilled workers would only be allowed to take up jobs suffering shortages in the UK

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Nick Clegg launched a stinging attack on Theresa May on Monday as he accused the Home Secretary of floating “illegal and undeliverable” plans to impose an annual cap on European Union nationals coming to work in Britain.

The Coalition row erupted after a leaked Home Office document disclosed that Ms May was examining proposals for a limit of around 75,000 EU workers a year allowed to  take up jobs. It broke out with little more than a fortnight until Romanians and Bulgarians gain full rights to work in this country.

Mr Clegg laid the blame for the leak at Mrs May’s department amid suspicions that she is positioning herself to attract support among Tory right-wingers hostile to the EU. The Deputy Prime Minister said: “My advice to the Home Office is to spend less time leaking policies that are illegal and undeliverable and spend more time delivering on the policies we have agreed as  a Coalition.”

He added: “If we pulled up the drawbridge now and said to German lawyers or Finnish engineers or Dutch accountants they can’t come to work, it would be a disaster for our economy. We are an open economy. The City of London would grind to a halt overnight. It would be very unwelcome to the two million Brits who live and work abroad and who I don’t think would thank the Conservative Party for entering a tit-for-tat race to the  bottom where everybody in the EU starts pulling up the drawbridge.”

Mr Clegg also spoke of his frustration that the Home Office had still not delivered on its commitment to introduce exit checks on visitors leaving Britain.

The leaked Home Office paper suggested that professional and highly skilled migrants from wealthy nations such as Germany and the Netherlands should only be given a work visa if they had a job, while lower-skilled  workers would only be allowed to take up jobs suffering  shortages.

The document, whose authenticity has not been disputed by the department, appears to contain suggestions that will form the basis of future attempts by a Tory administration to renegotiate Britain’s relationship with  the EU.

But they would be fiercely opposed by other EU countries, as they run counter to the commitment to “freedom of movement” that underpins the Union. Mrs May told MPs  yesterday she was not proposing the introduction of a cap on EU workers now, but considering the “possibility of reform in the future”.

Challenged at a hearing of the Home Affairs Select Committee over Mr Clegg’s suggestion that a limit would be illegal, she said: “We’re talking about potential reforms of accession treaties for the future.”

David Cameron will press his case for reform of the EU, including restrictions on freedom of movement, when he meets fellow European leaders in Brussels on Thursday.

Downing Street insisted Britain was not isolated and other countries, including Germany, shared the Government’s concerns about  “benefit tourism” and large movements of population within the EU.

Yvette Cooper, the shadow home secretary, claimed Mr Clegg and Mrs May were staging a “phoney war” to distract from the lack of preparation for the arrival of Romanians and Bulgarians from 1 January.