EU austerity measures are helping to feed racism and intolerance, according to a report by the Strasbourg-based human rights watchdog, the Council of Europe.

In its annual survey out on Thursday (3 May), the council's European Commission against Racism and Intolerance (ECRI), said welfare cuts and shrinking job opportunities are factors behind the recent rise in intolerance and violence directed at immigrants and other vulnerable minorities.

"Immigration is [being] equated with insecurity, [that] irregular migrants, asylum-seekers and refugees either steal jobs or risk capsizing our welfare system, while Muslims are not able to integrate in Western societies," the survey says.

It adds that talk by mainstream politicians of reintroducing border controls in the passport-free Schengen area is beginning to give xenophobia and far-right extremism a respectable face. "Political leaders must at all costs resist pandering to prejudice and misplaced fears about the loss of 'European values,' terrorism and common criminality," it says.

The German and French ministers of justice sent a letter to the Danish EU presidency in late April on curbing Schengen. French leader Nicolas Sarkozy has also complained that there are "too many immigrants" in France in his bid to woo far-right voters.

In Greece, the openly fascist Golden Dawn party is expected to win a dozen or so seats in parliament on Sunday (6 May). The group espouses claims of Greek and Aryan racial superiority and wants to landmine borders with Turkey to stop migrants.

In the Netherlands, the far-right PVV party has put up a website encouraging people to spy on and denounce eastern Europeans who work on the black market. A copy-cat website was launched in mid-April by the far-right Vlaams Belang party in Belgium and is still online.

The ECRI report notes that just 18 Council of Europe member states - and just seven EU members among them - have ratified Protocol 12 to the European Convention on Human Rights, which prohibits discrimination. The EU list is Cyprus, Finland, Luxembourg, the Netherlands, Romania, Slovenia and Spain.

The ECRI admonished mismanagement of asylum seekers - especially in Hungary, where asylum seekers are led around town on leashes and in handcuffs. It also said some governments are using the crisis as an excuse to amputate the budgets of human rights institutions and specialised anti-discrimination bodies.

Some vulnerable groups - such as the Roma, the largest ethnic minority in Europe - endure popular social stigma despite national and EU-level rhetoric on equal rights.

This reporter in 2010 met several Bulgarian-origin Roma families in Brussels who pretend to be Turkish in order to suffer less racism. "Many of us carry the stigma as a burden, others act against the stigma. It's more comforting to do so, in a sense," one of the contacts said.