- David Cameron warned he will have to agree to large increase to EU budget
- European Commission officials are drawing up plans to allow PM to stop citizens of new member states being able to work in UK for up to 20 years
- In exchange, Mr Cameron will be forced to agree to reduction of EU budget
- It means Britain could be forced to fork out billions in extra contributions
David Cameron has been warned he will have to agree to large increases to the European Union budget in return for limiting the number of migrants who can move to Britain.
European Commission officials are drawing up plans to allow the Prime Minister to stop citizens of new member states being able to work in the UK for up to 20 years as part of his EU renegotiation.
But in exchange he will be forced to agree to the scrapping of an historic agreement to reduce the EU budget – meaning Britain could be forced to fork out billions of pounds in extra contributions.
One of Mr Cameron’s proudest achievements in Brussels has been the February 2013 pact, which lowered the EU budget for 2014-2020 by about three per cent compared to the previous seven year period.
However, in a bitter blow, he has now been told he will have to sacrifice the hard-fought deal, which was the first ever real-terms cut in the EU budget, if he is to get concessions on migration.
Countries including Germany are expected to put pressure on the Prime Minister to allow them to unpick the budget agreement next year.
A source close to Jean-Claude Juncker said the 908billion euro (£673billion) budget limit could be raised by up to 20 billion euros to help pay for the migration crisis.
Britain has a national veto to block any such change, but as part of the renegotiation deal Mr Cameron would agree not to use it and effectively have his hands tied in the budget talks.
Mr Cameron will set out his demands for EU reform in the next fortnight in a letter to European Council president Donald Tusk and the leaders of the other 27 member states.
The European Commission has been working on possible solutions that will be discussed by the leaders at a Brussels summit in December.
Current restrictions stop them being to move elsewhere in the EU for seven years, but this could be increased to up to 20 years.
The Commission is also looking at clarifying its core principle of ‘ever closer union’ so Britain has a clear exemption from any further political integration.
A source close to European Commission president Jean-Claude Juncker (pictured) said the 908billion euro (£673billion) budget limit could be raised by up to 20 billion euros to help pay for the migration crisis
Mr Juncker told the European Parliament: ‘The EU budget is limited. Its resources are limited. The possibilities for flexible implementation are limited too. We are really at the limit of its budgetary capacity here.
‘The Commission has done everything to make sure all capacities are available to help this effort. But the European budget is too small to deal by itself with the problems we are facing.’
Mr Cameron wants to stop benefits for working migrants who have been in the country less than four years as part of his renegotiation, but the demand is proving one of the most contentious in talks behind closed doors.
Last month the Mail revealed that one of the Government’s most senior officials in the Brussels negotiations had privately conceded there would only be an agreement to restrict welfare payments for a matter of months because of fierce resistance from other EU countries.
A British government spokesman said: ‘This is just more noise and baseless speculation.
‘The UK has been clear on the changes needed on migration and welfare, and the PM’s multi-year EU deal which achieved the first real terms cut to the overall seven year budget it not up for grabs.’
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