LONDON (Reuters) - European Commission President Jose Manuel Barroso told British Prime Minister David Cameron on Monday he risked upsetting allies and losing international clout if he pursued an anti-immigration agenda designed to placate domestic voters.
Cameron retorted that British voters were concerned about immigration, and he was responding to those concerns. He has pledged to hold a referendum on Britain's European Union membership if his Conservative party wins a 2015 election, as he takes an increasingly hawkish view on curbing migration within the EU and reviewing its freedom of movement principle.
Cameron hopes to persuade voters that he has a workable plan to address their concerns over immigration. He also wants to curtail the growing support for the hardline anti-EU UK Independence party (UKIP), which threatens his chances at next year's vote.
Barroso, whose 10-year term as head of the EU's executive body ends next month, warned Cameron on Sunday against trying to seek changes to the EU's freedom of movement rules, saying they were essential to the bloc's internal market.
In a speech at London's Chatham House on Monday, he went further, saying that by engaging in such rhetoric on immigration, Britain risks isolating itself in Europe and undermining its attempts to achieve wider reforms.
"It would be an historic mistake if on these issues Britain were to continue to alienate its natural allies in central and eastern Europe," Barroso said.
"It is an illusion to believe that space for dialogue can be created if the tone and substance of the arguments you put forward question the very principle at stake and offend fellow member states."
Cameron has broadly outlined areas in which he wants to win reform from the EU, such as migration controls, retaining lawmaking powers at a national level and cutting red-tape for businesses. He has not given specific details, however. Other British parties also want reforms, but there is no consensus on a re-negotiation strategy.
Cameron has long said he would like Britain to stay in a reformed EU, but British Foreign Secretary Philip Hammond said last week the bloc would have to come up with a meaty reform deal if it wanted to avoid a break.
Cameron rejected Barroso's criticism, saying the British people were his boss and he answered to them.
"We need to address people's concerns about immigration," he told reporters on Monday. "They want this issue fixed, they're not being unreasonable about it and I will fix it."
Barroso said that while he understood British voters' concerns over Europe, the country has benefited from having the backing of other EU states on geopolitical issues such as climate change negotiations and sanctions against Russia.
"In short, could the UK get by without a little help from your friends? My answer is probably not," he said.
The Sunday Times newspaper, citing unnamed sources, reported that Cameron wanted to cap the number of low-skilled migrants from within the EU who could register to work in the country.
Barroso said while there was great willingness among other EU countries to accommodate Britain's concerns, there were clearly red lines that could not be crossed. He said he thought an arbitrary cap on immigration would "never be accepted".
"Are we going to create a European Union of first- and second-class citizens? No," he said.
Barroso warned of the impact leaving the bloc would have on Britain's prosperity, saying some of the "most important" global companies had said both publicly and privately that they would move out of the country if it were to leave the EU.
Nick Clegg, the deputy prime minister and leader of the Liberal Democrats, Cameron's pro-Europe junior coalition partner, said Britain would not be made stronger or more prosperous by leaving the bloc. Cameron's party was being pushed closer to EU exit by their "blind panic" over the rise of UKIP, he said.
"The Conservatives have now embarked on a strategy which has only one final destination, which is leaving the European Union altogether," Clegg told reporters on Monday.
Editing by Angus MacSwan