Is David Cameron's latest immigration crackdown legal under EU law?

David Cameron today announced another 'crackdown' on EU migrants, stating that from November, EU jobseekers "will only be able to claim Jobseeker's Allowance and other key welfare benefits for a maximum period of 3 months." This will halve the current period over which unemployed EU migrants can claim these benefits. The result of this change will therefore be that new arrivals from the EU cannot claim Jobseeker's Allowance for their first three months in the UK but can receive it for three months after that, rather than the six allowed under the existing rules.

In addition, a consultation has been launched on banning overseas-only advertising – legally requiring employment agencies to advertise in Britain, and new plans to restrict the number of Job Centre Plus jobs which are automatically advertised on an EU-wide job portal.

The European Commission has already said it will investigate whether the changes to the benefit rules are legal under existing EU law (the UK and Commission are already locked in a long-running legal dispute over EU migrants' access to benefits). So, are they?

Needless to say No10 and the DWP are confident they are, and we think the Government has a strong case. However, as we noted of David Cameron's last 'immigration crackdown' in November 2013, the UK is at the very limit of what it can do within the confines of EU law.

In order to keep this latest measure within the EU rules, it will only apply to new arrivals to the UK who have never worked in Britain. This is because under existing EU rules, people who have worked in the UK must be treated differently because they enjoy 'worker status' for at least six months. As others have noted the impact of this policy on the ground is therefore likely to be small as not many EU migrants will be affected.

We have ourselves called for the Government to address public perceptions about free movement, primarily by instilling the principle that EU migrants should only be entitled to benefits after having made an economic contribution. This is clearly David Cameron's intention and he used today's Telegraph article to make the point: "You cannot expect to come to Britain and get something for nothing."

But unless this latest measure is followed up with reform of the underlying EU legislation, the UK Government is in danger of chasing diminishing returns with the risk is that voters simply become desensitised to the flurry of crackdowns that make only piecemeal changes.

Government's Balance of EU Competences Review sets out need for reform - finally

Today, the UK Government has published the third batch of its reports reviewing the ‘Balance of Competences’ between the UK and the EU. We have noted before that many of the previous reports, whilst interesting on much of the detail, have for various reasons turned out to be rather disappointing and dodged the major questions facing Britain in the EU, so how do today’s tomes compare?

Most interestingly, the controversial, and much delayed, report on the free movement of persons has finally been published and, unlike many of the previous reports, it is much clearer about the Government's thinking in what is one of David Cameron's primary targets for renegotiation. The report, which was trailed in today's papers and quotes extensively from our submission to the consultation, which you can read in full here, makes the following points:

• "Whilst there is broad consensus that highly skilled migrants from the EU have been beneficial to the UK, there is less agreement regarding low skilled migration, with some arguing that gains for employers are offset by negative impacts on the lowest paid workers."
• "The scope of free movement rights has now expanded beyond their original intention, and is no longer limited to economic factors."
• "Successive judgments by the ECJ have interpreted the right to free movement set out in the Treaties and the Free Movement Directive broadly, with the consequence of expanding the rights of entry and residence which may be asserted in reliance upon them, and consequently restricting Member States’ competence in this area."
• Other concerns expressed were criminals' exploitation of the rules, the localised impact on public services, and falling public confidence in the concept of free movement.

Specifically regarding the existing rules on EU migrants' access to welfare, this is the key passage:

"The Government considers that now is an appropriate time to review the EU level rules with a view to modernisation and ensuring they are fit for purpose in the EU of today. The rules have evolved beyond the original scope as the EU has evolved and the interaction between rules on residence and social security coordination becoming increasingly complex. This complexity has led to an increasing number of challenges through the ECJ, creating uncertainty and, in the majority of cases, weakening the ability of Member States to determine how their systems operate."

"Without reform, legitimate public concern about how EU migrants access social security in other Member States is likely to significantly undermine support for the principle of free movement."

This is the most explicit any of the BoC reports has been about the need for reform and, while there is no settled policy prescription (the report discusses OE's and David Goodhart's reform proposals at length), the key issues have been clearly identified.

This is apparently the third iteration of the report, following several rounds of coalition ping-pong. Nevertheless, it highlights the degree of cross-party consensus on the need for reform of benefits rules - which Labour has also called for. It would however be intriguing to know what was cut in the various edits.

We will be leafing through the other reports published today and will return to them on the blog later this afternoon.

Timing, not substance, is the biggest obstacle to David Cameron's reform agenda

Our Director Mats Persson writes on his Telegraph blog:

In a recent Sunday Telegraph article that received surprisingly little attention at the time, David Cameron came close to setting out a “shopping list” of what he wants to change in Europe. He outlined seven areas, though they were more principles than policies: powers flowing back, a beefed-up role for national parliaments, less regulation and more free trade, limiting the influence of European judges (possibly opting out of the ECHR, which is not an EU institution), tightening welfare benefits for EU migrants, tougher controls on future EU accession countries and no more “ever closer union”.

Nick Clegg – in a strange kind of way – has almost endorsed the plan, saying that "Now [Cameron] doesn't even talk about repatriation, instead proposing a mild seven-point plan, most of which wouldn't even require treaty change." European Commission President Jose Manuel Barroso has said that the EU wants to "cater" to the UK without "threatening the Union’s coherence" (though he was all over the place on EU treaty change). And in the Financial Times this week, Jean-Claude Piris, former legal guru of the European Council – the key decision forum for EU leaders – concluded that Cameron's changes could pretty much be done without actually changing the EU treaties.

For Cameron, this is a double-edged sword. Sceptics at home already see Cameron’s starting position as a “sell-out” – mere presentational changes that will allow him to recommend a “Yes” vote in the 2017 referendum. This is a premature accusation as there’s a huge range within the Sunday Telegraph piece, from token reform to sweeping changes.

Cameron could cobble together a decent package without changing the EU treaties. First, areas like toughening up rules on access to benefits, removing trade barriers, signing free trade deals or scrapping red tape – key planks in Cameron’s renegotiation agenda – just fall under normal Brussels decision-making (which doesn’t meant it will be easy. Think European Parliament). Secondly, “repatriating” powers wouldn’t necessarily require EU treaty change but could still be meaningful, for example devolving the EU’s irrational regional policy (saving UK taxpayers £4bn over an EU budget period) or exemptions from maddening working time rules for the NHS.

Finally, the EU specialises in legal acrobatics. When pushed – say when the bloc’s second largest economy risks leaving – it can be amazingly creative. For example, it created a €440bn bailout fund out of thin air and via so-called political agreements, the Danes got four surprisingly effective opt-outs after having rejected the Maastricht Treaty in 1992, which were incorporated when the next EU treaty came around. Something similar can be done for some of the reforms currently being discussed, including giving national parliaments the right to block or revise EU laws.

So it's right that Cameron seeks to maximise the reforms that can happen without EU treaty change. However, not only would a Treaty change be a form of political insurance to the Tory party and public that things have changed but it's also needed since the treaties simply aren’t fit for purpose. With a more integrated eurozone, we need new organisational principles and practical measures to avoid the EU becoming the eurozone, while allowing powers to flow back to countries that wish to be less integrated. A 2017 referendum should be the start of a slimmed down, flexible Europe, not the end destination. A quick and dirty solution will only bring us back to where we are today – and could well generate a referendum result too close to call, solving nothing.

Ironically, the strongest and most plausible contender for a Treaty change is one measure that Cameron – oddly – didn’t mention in his piece: safeguards against the Eurozone writing the rules for the rest of Europe, which will also effectively kill the notion of "ever closer union". Exactly how this principle will be organised needs careful thought (ideas here), but it’s highly desirable that this principle is firmly enshrined in EU law.

Since it’s the eurozone that is now changing the rules via banking union and other measures, not the UK, Cameron would be given a fair hearing in national capitals on this point. It is conducive to a "grand bargain": the Germans and French solve their catch-22, agreeing to beefed up supervision in the Eurozone in return for Berlin underwriting the euro, while the British ask for safeguards against Eurozone stitch-ups in return for nodding through EU treaty change at 28 (which Berlin still prefers). In this scenario, it’s the German-led EU treaty change that may trigger a referendum in France, not the UK’s.

It's whether it can be done before 2017 that remains the biggest question.

It's not just the UK that's losing patience with the Commission over access to welfare

Viviane Reding

In a few weeks time, the transitional restrictions on citizens from Bulgaria and Romania gaining full access to all EU member states' labour markets will expire. As we have covered in our press summaries and on our blog, it's not just in the UK where this has led to political upheaval.

Last week, European Commissioner Viviane Reding finally responded to concerns expressed by the UK, Germany, Austria, and the Netherlands back in April about benefit tourism in the EU. Although she was right when saying that “free movement is a right to free circulation; it is not a right to migrate in member states' social security systems”, her actual policy proposals aren't terribly convincing.

In order to crack down on the abuse, the Commission proposes:

- a handbook to help local authorities spot sham marriages as well as guidelines on habitual residency, which would determine the extent to which a person is entitled to draw benefits in a host EU country (in other words, more intervention into national policy)

- helping local authorities understand EU free movement rules

- topping up the European Social Fund

That throwing more money at the problem isn't going to improve things shouldn't need to be said, especially given the sorrow state of the EU budget. The UK, is according to EU officials, "very disappointed with the scale and ambition", while German Interior Minister Hans-Peter Friedrich reacted by saying, "To launch discussions or to develop brochures won't suffice".


Hans-Peter Friedrich

What Germany will do next most likely depends on how smoothly the "second accession" of Romania and Bulgaria in January goes, but in any case the German coalition deal doesn't leave any room for doubt that it is determined to do something about it if problems arise.

Friedrich has threatened to work with other governments “outside the structures of the EU” if the Commission doesn’t respond adequately to concerns about welfare tourism - another signal that Germany is ready to resort to intergovernmentalism as it has signalled it will do with the banking union, at least for now.

Dutch Interior Minister Lodewijk Asscher, who has been making many similar noises to the UK and Germany, thinks that more Romanians and Bulgarians will come to the Netherlands than has been predicted. He said, "The official predictions are low, but earlier predictions weren't correct either."

He added that he would have liked to extend restrictions for Romania and Bulgaria, but "if you have an agreement with other countries, you should stick to it". However, local authorities in the Dutch cities of Rotterdam and The Hague are reportedly ready to defy EU law by denying tax or social security numbers to Romanians or Bulgarians who fail to pass housing and employment checks.

Meanwhile, today, UK Work and Pensions Secretary Iain Duncan Smith has announced that new migrants will be asked to prove that their English language skills will be no barrier to them finding employment in Britain, under plans to strengthen the UK’s Habitual Residence/Right to Reside Test. The Dutch coalition agreement already states that "Individuals who cannot speak Dutch will not receive social assistance benefit. This principle will be applied consistently: to EU nationals, third-country nationals and Dutch nationals."

The European Commission's run-ins with the UK, over the 'right to reside test', and Germany, following which Friedrich accused Commissioner Reding of "ignorance", highlight the level animosity its approach has caused.

The EU Treaty doesn't need to be re-written to deal with this issue. We've made a few suggestions here that the Commission would do well to engage with it if it really cares about maintaining support for free movement in Europe.

Will the European Commission challenge Cameron's crack-down on EU migrants’ access to benefits?

We have just published a new flash analysis looking at David Cameron's plans to change the rules on EU migrants' access to benefits.

Here's a handy table (click to enlarge) summarising the key proposals, and whether they are likely to be deemed legal by the European Commission:

So whether the European Commission will  take the UK to court will very much depend on, how, exactly the measures are implemented. Interestingly, so far the Commission has stayed clear of openly saying the measures are illegal, and of course, the UK government will have sought to ground this with both its own lawyers and EU ones.

However, remember, the UK is already locked into an ongoing legal dispute with the Commission over the rights of EU migrants to access the UK’s ‘universalist’ welfare system. Cameron’s recent intervention signifies a definite hardening of tone and position in this dispute, and in response EU Social Affairs Commissioner Laszlo Andor has said that the UK risks being seen as a “nasty country.”

As we have said before (see here, here and here, for instance), we think the Commission has a tendency to be overly activist in this area. However,  the key issues here - which Cameron could have done a better job of expressing in his intervention -  is that the EU's complicated and outdated rules on access to welfare need a complete overhaul, something which the Austrians, Dutch and Germans have already signalled their support for.

Row alert: Germany and the Commission clash head on over EU migration

The European Commission isn't winning many popularity contests at the moment. The Italians are furious, and the Dutch aren't happy with it either. A recent Open Europe/Open Europe Berlin opinion poll showed that, out of 13 EU and national institutions, Germans trust the European Commission the least.

As we've noted previously, one now hears more rude things about the Commission in Berlin than in London. And sure enough, Germany is now heading for an almighty row with Brussels over EU migrants' access to benefits. 

EU Commissioner for Employment and Social Affairs, László Andor last week told Der Spiegel that migration to Germany from Bulgaria and Romania "only involves benefits for both sides." The fuss over access to benefits - and potential cost to the welfare state of EU migration - is overblown, claimed Andor.

German politicians have responded with an unusual degree of fury. The CDU/CSU faction’s spokesman for interior policy, Hans-Peter Uhl, labelled the claim “an outrageous denial of reality” and a “first-class frivolity.” In case people didn't get the message, he added that some Commissioners are as far removed from reality “as the moon from the earth” (which is about 384,000 km, so a considerable distance).

German Interior Minister Hans-Peter Friedrich also weighed in, telling Die Welt that

freedom of movement is not the freedom to change country because of higher benefits...The Commission needs to take this concern seriously.

Following a meeting of Interior Ministers this morning, interestingly, Friedrich has now demanded

a clear statement from the European Union whether we can send back those people who come to Germany to surreptitiously obtain benefits and also to prevent their re-entry

There are similar noises coming out of the Netherlands - and of course the UK. Issues related to free movement of persons are on Interior Ministers' agenda this afternoon. Expect this one to run and run.

Your guide to EU free movement and access to welfare

As the secretariat to the All Party Parliamentary Group for European Reform, Open Europe has prepared a new report looking at EU free movement and the lifting of transitional controls on Bulgaria and Romania in 2014.

As well as including the outcome of the APPG’s public discussions, held in March, with the Bulgarian and Romanian ambassadors, the report addresses, in some detail, the hot topic of EU migrants’ access to welfare. The report also includes written submissions from the Bulgarian and Romanian governments, and the UK's Department for Work and Pensions.

It is therefore a comprehensive guide to how the EU rules on access to benefits work and why the UK's particular welfare system needs safeguards such as the 'right to reside' test, which the Commission has decided to contest at the European Court of Justice.

It is particularly interesting to see how different welfare systems across Europe are, not simply in terms of their outright generosity, but in how they are funded.

The graph above shows that the UK's welfare system relies heavily on funding by the state through general taxation rather than the greater use of insurance-based contributions (from employees and employers) in many other member states. In addition, in the UK, the amount that can be claimed by individuals is often not linked to contributions, being either means tested or for benefits such as Job Seekers Allowance, effectively set at a flat rate (£71.70 a week). By contrast, if you become unemployed in Germany you could expect to receive 60% of your previous earnings and in Denmark 90%.  This is one of the main reasons why the Government is so concerned about migrants being able to claim benefits without having made an economic contribution to the country through work.

This is not to say the UK is alone in having concerns about this issue. In 2011, 13 national governments called on the Commission to revisit the rules on free movement and social security coordination, in particular "the concept of residence in the context of the interaction of the social security coordination Regulation 883/2004 with other relevant EU instruments, notably the free movement Directive 2004/38." This makes the Commission's decision to take legal action last week all the more difficult to understand.

The final section of the report looks at the proposals put forward by David Cameron in March and suggests further options that should be considered when seeking to re-write the EU's free movement rules. What this report shows is that the vast array of different welfare systems at play in Europe requires allowing national governments greater flexibility to protect their particular welfare models.

Free movement, as we've said many times before, brings many benefits, but you can only have free movement if there is public confidence in it.

Why the Commission has grossly over-stepped the mark with its court challenge on right to reside

The Commission has now published its press release explaining its reasoning for taking the UK to court over its ‘right to reside’ test for EU migrants. This is the key passage:

“The ‘right to reside’ test is an additional condition for entitlement to the benefits in question which has been imposed unilaterally by the UK. UK nationals have a ‘right to reside’ in the UK solely on the basis of their UK citizenship, whereas other EU nationals have to meet additional conditions in order to pass this ‘right to reside’ test. This means that the UK discriminates unfairly against nationals from other Member States. This contravenes EU rules on the coordination of social security systems which outlaw direct and indirect discrimination in the field of access to social security benefits.”

The benefits that the Commission cites as being affected are:

- Child benefit
- Child tax credit
- Jobseekers' allowance (income-based)
- State pension credit
- Employment and support allowance (income-related)

So, some are asking, isn’t this simply a case of the Commission enforcing the law?

To answer this question, you have to get to the real heart of the matter, which neither the Commission nor the UK Government has really set out explicitly. It is a rather complex technical issue of how certain benefits are defined and how the UK’s welfare system interacts with different EU laws.

The underlying issue is that most EU countries tend to have a generous ‘social security’ system but one which is generally financed by in-work contributions (so as a migrant you wouldn't get access without substantial contributions and neither would a host national). They tend to have a lower safety-net ‘social assistance’ scheme (if they have one at all).

EU law (under the Free Movement Directive) allows governments to indirectly discriminate when assessing claims for ‘social assistance‘ and prevents people gaining residence rights by simply accessing social assistance. For social security (for which there is a separate EU Regulation) all forms of discrimination are prohibited. It is important to remember that the right to free movement within the EU is not unqualified – you have to be travelling to work or seeking to work. Travelling to access social security was not envisaged, but workers should be treated equally while in work.

In the UK, for unemployment benefit for example, there is a flat rate Contribution-Based Jobseekers' Allowance and also Income-Based Jobseekers' Allowance. The former is nominally financed by employee and employer contributions through National Insurance (but in effect are funded through general taxation) as pay-outs are not linked to contributions and the latter is means tested.

From the Commission’s challenge it appears that it thinks both types of JSA should be considered ‘social security’ and therefore there can be no indirect discrimination, which they argue the ‘right to reside test’ is. However, unlike in other countries, that means incoming migrants can potentially get access to the bulk of UK welfare system having contributed very little, if anything at all. This is why the Government is defending the ‘right to reside’ test as a means of ensuring you can only claim in the UK if you have a legal right to be in the UK and an economic link to the country. The Government would also argue that Income-Based Jobseekers' Allowance should be defined as ‘social assistance’.

The heart of this then is not necessarily that the ‘right to reside’ test is indirectly discriminatory as that is already accepted. In 2011, the UK Supreme Court ruled that the ‘right to reside’ test is indirectly discriminatory but “that this discrimination is justified because the Regulations are a proportionate response to the legitimate aim of protecting the UK public purse and that this justification is independent of the claimant’s nationality.”

Another recent case is also interesting. Austria is fighting the Commission in the ECJ about granting access to a certain benefit to an incoming migrant from Germany. As Work and Pensions Secretary Iain Duncan Smith told the World At One earlier, “the Austrians were told, in the Brey case, that they could not…they had to pay somebody who was a German the income-related benefits, because they were essentially social security, not social assistance.”

However, yesterday, the ECJ’s Advocate-General came down in favour of the Austrians, whose argument was supported by the German, Irish, Netherlands, Austrian, Swedish and UK Governments, in saying that the particular benefit constitutes social assistance and that Austria can therefore impose safeguards. IDS has taken heart from this opinion and the Government believes the same principle applies in the UK case.

In Spain, there is now a different but related argument about the refusal of some hospitals to recognise the European Health Insurance Card – it is as yet not clear why the hospitals have refused but Spain is also subject to legal challenge from the Commission.

In short, the EU’s current rules in this area, which have largely developed through case law, are hugely complex and do not reflect the different national systems that are in place. As IDS said, the UK Government is already talking with “the Germans, with the Dutch, the Danes, the Spanish” about setting the limits to the EU’s power in this area. Given that, this is completely the wrong time for the Commission to launch an intervention as politically explosive as this.  It is also worth adding that there is a cross-party consensus on this issue with Shadow Home Secretary Yvette Cooper today backing the coalition's position.

The UK should therefore avoid merely a narrow defence of its right to reside test but use this opportunity to settle this issue once and for all with root and branch reform.

The European Commission’s decision to take UK to court over migrants’ access to benefits is a spectacular own goal

Our Research Director Stephen Booth was on BBC Radio 4's Today Pragramme this morning discussing the news that the European Commission is today expected to take the UK Government to court over the so-called 'right to reside' test that is applied to EU migrants seeking to claim certain welfare benefits.

We don't have all the details of the legal challenge yet, they are expected to be released later today.

But this dispute has been bubbling away for a while now. The Commission says the right to reside test is illegal under EU law as British citizens pass it automatically. The UK Government is disputing this claim saying it is clear that the UK rules “are in line with EU law.”

The dispute is largely the result of a clash between the UK’s particular welfare model, which includes many non-contributory, means-tested benefits, and the EU rules, which prohibit any discrimination and applies the same logic to every EU member state, despite the huge differences between individual countries’ welfare systems. As Stephen said:

"What is also important to understand here is the UK has a particular welfare system that is universalist and involves lots of means tested benefits, unlike on the continent where a lot of it is based on contributions. So we have a system that needs safeguards in order to ensure that only people who are eligible can claim benefits and that's what the right to reside is meant to ensure."

The European Commission has thrown a political hand-grenade into two deeply controversial domestic debates: Europe and immigration. It is the worst possible issue to challenge the UK on, and at the worst possible time. As we have argued in the past, we think free movement has its upsides, but you cannot have free movement without public confidence that the freedom won't be abused.

On this showing, it is difficult not to draw the conclusion that some senior figures in the Commission would be quite happy to see the UK leave the EU.

More details to follow when we have them.

What is proposed under 'Cameron's crackdown' on immigration - and is it compatible with EU law?

In a keynote speech on immigration, David Cameron has today announced a host of new measures designed to curb EU and non-EU immigrants' access to welfare benefits. With transitional controls on Romania and Bulgaria lapsing at the end of the year, the political debate on EU free movement in the UK has threatened to boil over.

We have consistently emphasised the benefits of free movement but we do recognise that there are genuine concerns regarding the impact large-scale immigration can have on public services, the lower-skilled section of the labour market and particular communities. It is also clear that there is real public concern about access to welfare systems, given the UK's particular circumstances: a free health service and a number of non-contributory benefits.

So what does Cameron propose? His speech addressed immigration in general but the measures he announced regarding EU migration in particular were the following:

To ensure people cannot claim benefits indefinitely, in early 2014 we will create a statutory presumption that after 6 months an EEA national can no longer retain their status as a job seeker or retained worker and continue to claim benefits, unless they can demonstrate they have actively sought work throughout that period and have a genuine chance of finding work....

...We will strengthen the test people have to pass to see if they are eligible to claim income related benefits – the Habitual Residence Test. There will be an increase in the number and stronger range and depth of questions asked...

 ...The Government will introduce an expectation on councils to introduce a local residency test in determining who should qualify for social housing. This would mean someone would have to live in an area for say 2 or 5 years before they could even go on the waiting list. This will stop someone from turning up and immediately gaining access to social housing. To ensure UK nationals are protected when they are moving for genuine reasons – for example for work or because of family breakdown – local authorities will have the ability to set exceptions (e.g. in relation to work mobility, armed services personnel, for people escaping domestic violence etc)...  

...Government wants to stop the expectation that our health service is free to the entire world and we will take new steps to ensure the NHS can claim back money that is owed for NHS treatment provided to those not entitled to it. 

So this is addressing the so-called "pull factors". Now these are all things that the Government thinks it can do within the existing limits of EU free movement law - but the European Commission has already launched legal proceedings against the UK for its 'right to reside' test and you can count on the Commission to scrutinise any new proposals closely. The fact that so much of this is already considered possible begs the question of why the UK hasn't done it earlier.

Cameron also explicitly mentioned two areas where the UK will seek to renegotiate the rules at the EU-level:

We are also going to take forward negotiations with European partners to explore whether we can make economically inactive migrants the responsibility of their home country before they gain any eligibility for UK benefits.

And also whether we can work with like-minded European partners to limit the amount we pay in child benefit towards the upkeep of children living abroad.

The UK is likely to find allies on these two issues among the Northern countries, such as Germany and the Netherlands, but whether there will be a majority in the EU to make these changes is unclear at this stage.

Let's tone it down a notch: Comparing the UK and German debates on EU migration

No one picking up a UK paper will have failed to notice that there is some concern over EU migration on the British isles, with the debate being triggered by the end of so-called "transitional controls" for Romanian and Bulgarian workers (the countries joined in 2007).

As we've argued repeatedly, EU free movement has on the whole been beneficial for both Europe and the UK, but the issue must be handled with much care, given its exceptionally sensitive nature and the practical impact it can have on public services and certain sectors of the labour market.

But there's also a false perception in the UK that all of Europe wants to come to Britain to enjoy its superior welfare system. This is far from the truth and secondly, the UK isn't the only country that has concerns over EU migration. It is, however, the country in which the debate is the most hysterical. Philip Collins looks at this in today's Times.

Speaking in Parliament earlier this week, Work and Pensions Secretary Ian Duncan Smith said there was a “crisis” over rules on EU migrants’ access to services and welfare, particularly in light of the expiry of transitional controls on migrants from Bulgaria and Romania at the end of the year. The issue definitely needs to be looked at, and there are several things the UK needs to do (see here). The Commission also needs get its act together and drop its own-goal challenge against the UK's "right to reside" test - the test is a political hugely important filter to guard against welfare abuse. But crisis?

Duncan Smith did, however, rightly point out that other EU member states shared some of the UK’s concerns, specifically that “Germany has woken up at last to the reality that it might face a large net migration”.

So what is the nature of the corresponding debate in Germany? Well, there's a genuine concern. A recent position paper by the German Association of Cities generated a lot of coverage as it focused specifically on so-called ‘poverty migration’ from Bulgaria and Romania, particularly those from a Roma background. The report warned that these migrants arrived in cities already affected by relatively high unemployment and with severely stretched public finances, and that despite the transitional controls in place, migration from Bulgaria and Romania had increased six-fold since 2006.

In terms of the public response, German Interior Minister Hans-Peter Friedrich (CSU) recently warned that:

“Abuse of free movement could be explosive for European solidarity. If people in Germany feel that their solidarity and openness is being abused and our welfare system is looted then there will be legitimate anger. The message for the EU Commission is clear: Brussels has to take stronger account of situation of the local population in its decision making process.” 

Justice Minister Sabine Leutheusser-Schnarrenberger (FDP) has also stressed that "Many Roma flee their homes because of discrimination and resulting poverty… Poverty-related migration must be addressed at its roots." Germany has also said it might veto Bulgaria and Romania’s entry to the border-free Schengen zone, which the UK is not part of.

Clearly, Germany could be an ally for the UK in terms of instituting clearer and more transparent rules on EU wide migration and access to welfare which are necessary to restore public confidence in free movement, as we’ve argued in our report on the subject.

However, on the whole, the debate in Germany has been far more measured than in the UK, with substantially fewer scare-stories on the subject from the press and politicians. For example, the often sensationalist Bild ran a feature on Roma migration earlier this week which was relatively balanced, stating that “there has been no mass immigration” and that migrants tend to seek employment, not benefits.

And that's what UK politicians and media need to remember: the overwhelming evidence suggests EU migrants come to Britain to work, not take advantage of the system.

How to lose support for EU free movement and alienate people

The European Commission just made it a lot more difficult to defend free movement in Europe. Free movement and open borders (two separate but related EU issues) are very difficult things to sell to the public, witness the Bombardier row (which had complicated causes, but partly flowed from competition rules designed to uphold free movement/the EU single market), the Danish restrictions on the Schengen agreement or the Lincolnshire strikes back in 2009.

In public opinion, free movement is usually bundled together with other complex issues such as immigration, the 'British jobs for British workers' debate, welfare and potential wage dumping. Economically, we would argue that free movement is on the whole beneficial, but politically, due to its society-changing potential, it's potentially explosive.

Therefore, free movement has to be treated with silk-gloves, with constant attention paid to national sensitivities. If Europe wants to keep it, national governments simply need to be given some discretion, within reason.

Clearly, this isn't something that the Commission understands. This week, the Commission threatened to take legal action against the UK's "right to reside" test on EU nationals, arguing that it violates EU law. Under UK rules, British citizens automatically qualify for benefits such as child benefit, child tax credit, state pension credit, jobseekers' allowance and unemployment support. But nationals from other countries have to pass a right to reside test before they can qualify for such benefits. The Commission argues that this practice indirectly discriminates against nationals of another member state, in turn breaching EU rules on social security co-ordination. The Commission insists that existing EU rules on who qualifies as a resident of a different member state are already strict enough to make sure that "only those persons who have actually moved their centre of interest to a member state (other than their own) are considered habitually resident there".

The Commission's statement was met with a barrage of criticism in the UK.

Employment Minister Chris Grayling said, "This is a very unwelcome development...I’m really surprised the European Commission has chosen to go into battle on this very sensitive issue, when there are clearly far more pressing problems to solve in Europe."

Work and Pensions Secretary Iain Duncan Smith wrote in the Telegraph:

"These new proposals pose a fundamental challenge to the UK's social contract. They could mean the British taxpayer paying out over £2 billion extra a year in benefits to people who have no connection to our country and who have never paid in a penny in tax. This threatens to break the vital link which should exist between taxpayers and their own Government."

"France, Germany and Denmark have all spoken out against the commission's insistence on issuing this week's provocative decision on benefit payments. This decision confirms the worry that the EU is pulling more areas of national competence into its fold. Yet these are decisions taken outside of national democratic processes by unelected and unaccountable institutions."

Given the recent statements from various prominent Labour party figures, apologising for "getting it wrong" on EU immigration, the Commission is likely to face more or less united UK opposition.

Even supporters of free movement will find it hard to see how the UK's "right to reside" tests are unreasonable. The Commission is now picking a fight with several EU countries, on the hugely sensitive issue of "welfare tourism" at a time when populist parties are on the rise across Europe.

Either the Commission backs down, or it risks facing a massive backlash.

As we've mentioned before, if the Commission wants to squash all public support for the EU, it's doing a pretty good job.