The Government is facing crisis in its attempts to prevent European foreign nationals coming to the UK to claim benefits, Work and Pensions Secretary Iain Duncan Smith has said.
He told MPs it is currently too easy for migrants from the European Economic Area to pass a habitual residency test to prove they live here, so entitling them to benefits.
Mr Duncan Smith said the Government tried to make it harder but faced tough opposition from Brussels.
Meanwhile, the Government is looking at ways of forcing councils to detail to whom they are offering social housing, while GPs will be handed strict guidance so they know they can refuse to treat certain migrants who have no right to claim free services on the NHS, the minister said.
Responding to an urgent question from Labour MP Frank Field in the Commons, Mr Duncan Smith said: "I agree with you, there is somewhat of a crisis over this. I absolutely agree with you. For the last two years I have been fighting a rearguard action over what was left to me by the last government.
"The reality is that it is all right for (Labour) to moan but let's put the facts as they are - I inherited a habitual residency test which simply isn't fit for purpose. We are trying to tighten that up dramatically and I am being infracted at the moment by the European Union for doing that. But you are absolutely right, and I am with you on this, to describe this as a crisis."
Mr Duncan Smith said that at present EU migrants must pass a habitual residency test but to do so they do not need to prove that they plan to stay here for any period of time. It was also possible for EU migrants to claim child benefits from the UK, even if their offspring lived in their native country.
By claiming self-employed status, migrant workers could claim tax credits from the UK, he told MPs, adding that, under the Labour government, net migration stood at 2.2 million people, which is larger than the population of Birmingham.
Mr Duncan Smith said the system was "falling down" in some areas but other EU countries were angry about the problem, including Germany, which had "woken up at last" to the issue.
But the European Commission was contesting the UK's habitual residency test, Mr Duncan Smith told MPs, adding that the Government was looking at the length of leases some migrants take out in rented housing.