Europe threatens new Brexit war over Nigel Farage's immigration plans 'huge consquences'

Reform plans to negotiate with Brussels to prevent EU citizens with "settled status" from claiming benefits if it wins the next general election.

But European sources have poured cold water on any prospect of downgrading the status of EU nationals who are resident in Britain, and protected by the legally binding post-Brexit treaty.

Brussels delivers ultimatum over treaty rights

"It takes two to tango in a treaty negotiation, why would we agree to reopen this very sensitive Brexit legacy to make EU nationals worse off than they are now," one European diplomat told The Telegraph. The news emerges as Nigel Farage faces EU migrant showdown as he vows higher wages for British workers.

"It would not happen and if a UK government stripped people of their rights under the withdrawal treaty there would be huge consequences. It would breach all the undertakings made by Britain since the referendum and would crash relations."

Officials also noted that UK nationals resident in EU countries are also protected under the current agreement.

Farage targets "endless cheap foreign labour"

Farage argued that the plans to scrap "indefinite leave to remain" and require all migrants to gain work visas at nearly double the current salary threshold would stop "endless cheap foreign labour", with all those ineligible for the new visa deported if they refuse to leave the UK.

However, Reform clarified on Monday that there would be an initial exemption for 4.2 million EU citizens, raising questions about the true size of welfare savings - given many overseas claimants have "settled status".

The policy would initially be limited to 431,000 non-EU migrants who have indefinite leave to remain in the UK.

Figures expose scale of EU benefit claims

Official figures show that nearly 10 per cent of universal credit claimants have EU settled status, a post-Brexit status which allows them to live, work and claim benefits in Britain. Just 2.7 per cent of universal credit claimants are non-EU citizens with indefinite leave to remain in the UK.

Reform's claim that it could save £234 billion was also criticised by Labour, after Farage based the figure on a report by the Centre for Policy Studies. The think tank said it was based on estimates by the Office for Budget Responsibility that had since been disputed, meaning it "should no longer be used".

Labour brands plan "falling apart in real time"

Farage insisted it had been an underestimate, anyway, but Anna Turley, Labour's chairwoman, said the plan was "unfunded, unworkable, and falling apart in real time".

The Reform UK leader suggested that anyone, including those with family members who are UK citizens, Ukrainians and Hong Kongers, would be subject to the same rules.

"All over the world, you apply for a work visa. That visa is for you. Not to bring your family. It's for you. It's for a set period of time, and at the end of it you leave, or you're physically deported. That is how a normal work visa works," he said.

800,000 face losing residency rights

Reform said scrapping indefinite leave to remain would mean forgoing the granting of residency rights and access to benefits to 800,000 people who are approaching the five-year period required to be in the UK.

Farage blamed net migration rising to record highs under the previous Conservative government, branding it the "Boriswave", in one of his strongest direct criticisms yet of the former prime minister.

The scale of the number of people who could be deported remains unclear, given that Reform has said the new visa salary threshold will rise from £41,700 to around £60,000 per year.

A specific number has not been set, which experts said made it hard to estimate how many people already living and working in the UK would become ineligible, as well as uncertainty over the number that would leave voluntarily instead of being deported.

Business groups warn of labour shortages

However, business groups warned the move could lead to significant labour shortages.

"The vast majority of employers who recruit from overseas do so only when they cannot access the skills they need domestically," said Alex Hall-Chen, a senior policy adviser for employment at the Institute of Directors.