THE TUC has condemned draconian new plans announced by David Cameron to bar EU migrants from claiming welfare for up to four years as adopting a "sledgehammer" approach to an exaggerated problem.

In a highly publicised speech yesterday the Tory leader outlined proposals which would mean that EU jobseekers without an offer of employment would not be allowed to claim the new universal credit when they arrive in Britain.

Migrants would only be able to claim tax credits, child benefit and apply for social housing after four years in the country, and would receive no child benefit or child tax credit for offspring living abroad.

He also pledged to revoke the licences of colleges whose students overstay visas, extend "deport first, appeal later" rules and make landlords check tenants' immigration status.

Mr Cameron also signalled that he is ready to pull Britain out of the European Union if other EU states oppose the new proposals to cut immigration.

Speaking in Staffordshire a day after official statistics showed net migration rising to 260,000 over the past year - 16,000 higher than when the coalition came to office - Mr Cameron conceded that his policies had "not been enough" to meet the target of cutting overall numbers by 2015.

The announcement was welcomed by big business. Institute of Directors (ioD) director-general Simon Walker said: "The IoD wants to see hard-working and able European workers growing the British economy. That is not the same as extending an already debilitating benefits culture to those entering the country."

But TUC general secretary Frances O'Grady accused the Prime Minister of "taking a sledgehammer to a problem that he has exaggerated.

"People are coming to Britain to work. There is little or no evidence that benefits make a difference, so today's announcement will have no impact on numbers. It might sound tough but will only stoke up cynicism and conflict," she said.

"We need a new approach based on ending Britain's status as Europe's exploitation capital, where the worst bosses use migrant workers to undermine rights and wages.

"If the government was serious about reducing benefit spending, it should be doing something about the poor pay and high rents that drive up the benefits bill for those in work."