José Manuel Barroso: 'Immigration cap will never be accepted by Europe'

An "arbitrary cap" on immigration into Britain "will never be accepted" by the European Union, José Manuel Barroso has said in a direct blow to David Cameron.

The outgoing European Commission president said such an idea would create "first and second class citizens" within the EU and would not be agreed by member states.

Mr Barroso also accused the Prime Minister of double standards by revealing Mr Cameron called him personally to demand the freedom of movement principle was protected in Gibraltar, where EU citizens were facing long delays crossing the border.

While there is widespread support for keeping Britain in the EU there are "red lines" that member states will not let the UK cross during any renegotiation of terms, the former Prime Minister of Portugal warned.

He added that some of the "most important" companies in the world have privately said they would leave the City of London for Paris or Frankfurt if Britain decides to leave the EU.

The comments came in a question and answer session in London after Mr Barroso's widely trailed Chatham House speech on Britain's EU membership, where he warned capping migration would be illegal.

David Cameron told Tory conference last month that reform of the freedom of movement principle would be "at the very heart of my renegotiation strategy for Europe".

Number 10 is understood to be considering controlling migration by capping national insurance numbers handed out to migrant workers from within the EU.

Asked about the proposal, Mr Barroso said: "It seems to me that any kind of arbitrary cap is against a fundamental principle of the treaties, that is freedom of movement, and that I'm sure it will not be accepted. "

He revealed Mr Cameron personally telephoned him and demanded freedom of movement be upheld in Gibraltar, where citizens were being delayed for hours from entering the British oversees territory due to Spanish authority checks.

"Prime Minister Cameron called me precisely asking us to guarantee the principle of freedom of movement," Mr Barroso said.

"There are 700,000 British [citizens] living in Spain. They are welcome. According to our statistics 1.4 million British people live in Europe - apparently in winter it is 2 million - and they benefit from that freedom of movement."

"So would it be fair that British citizens benefit from freedom of movement and other [countries do not]? What would be the criteria?

"The criteria of the wealth of the countries? Are we going to create a new pyramid, first and second class citizens? No, no."

Returning to the idea of an immigration cap, he added: "We have to see the proposals. I cannot yet tell you exactly the response. But it seems to me that an arbitrary cap will never be accepted."

The comments are further evidence that Mr Cameron faces an uphill task renegotiating terms of EU membership that are both palatable to the Tory Right and acceptable to other member states.

The Prime Minister has pledged to hold an In/Out referendum on the EU by the end of 2017 if re-elected but must counter the appeal of the UK Independence Party in the next seven months if he hopes to stay in Number 10.

Mr Barroso, due to step down as European Commission president this month, also revealed leading companies have said they would flee Britain if the country voted to leave the EU.

"Some of the most important global companies [have told me] that they will move out Britain from the city to Frankfurt or to Paris if Britain leaves the European Union," Mr Barroso said, naming the financial and automotive industries as areas that would be affected.

He also said that while expansion has been "the greatest achievement in the history of the EU", member states are now feeling "enlargement fatigue" and lack enthusiasm for new entrants.