Deputy Prime Minister Nick Clegg launches an assault on “Chinese-style” welfare reforms being floated by the Tories.
Mr Clegg condemned the idea of “penalising the young” amid suggestions that benefits could be limited to the first two children and under-25s could lose housing benefit.
He also warned that a single party government after the 2015 general election was one of the “greatest single risks” to the economic recovery.
The intervention came after Conservative Work and Pensions Secretary Iain Duncan Smith backed proposals for a fresh crackdown on welfare.
Speaking on the BBC’s Andrew Marr Show, Mr Clegg insisted he was “no slouch” on reforming the benefits system.
He said he supported efforts to extend restrictions on benefits for immigrants from EU countries, and said he would “look at” other proposals from his coalition partners.
But he added: “I am not in favour of penalising the young. I am not in favour of a sort of Chinese-style family policy saying that the state says it is okay to have two children, it is not okay to have three children.”
Shadow work and pensions secretary Rachel Reeves said: “The government have been playing catch-up after Labour proposed measures to ensure people are coming to UK to contribute, not just to claim benefits.
“We’ve said that the EU framework needs reform, including to look again at social security and Labour market rules, but that means serious proposals and effective influence in Europe, not empty bluster.”
EU Employment Commissioner Laszlo Andor said the UK risks “losing friends” if British politicians continue with the same rhetoric on EU migration.
Mr Andor claimed he was justified to warn about the UK being seen as a “nasty” country for pushing forward measures to restrict migrants’ access to benefits.
He told BBC Radio 4’s The World At One: “I think I perfectly justified my early warning about unfortunately the way the rhetoric developed in the UK results in losing friends and the risk of a bad image unfortunately is still there.”
Mr Andor said he disagreed with Labour’s shadow business secretary Chuka Umunna who said freedom of movement should only apply to those with jobs.
He said: “I believe that these rights they apply to EU citizens regardless of having or not having a job at the same time.
“Exactly at this time when there are such great imbalances in the European economy they should say that the economies, the labour markets of particular countries also provide opportunities for jobseekers.”
He called on Britain to do more to deal with youth unemployment and to stop the “disproportionate” blaming of migrants for problems such as crime and homelessness.
He said: “I know that crime in the UK did not begin with the Romanians, homelessness in the UK did not begin with the Bulgarians so it’s absolutely disproportionate to connect these local problems with these two countries, the so-called new member states of the European Union, there has to be a focus on resolving these social problems in the UK.
“There should be a more robust UK strategy against youth unemployment, for example, and I think it’s very often just misleading if there is a disproportionate attention and focus on the EU migrants from these two countries.”