British prime minister David Cameron has said restricting welfare payments to EU workers is an "absolute requirement" of his efforts to renegotiate the UK's relationship with the bloc as he unveiled a new crackdown on immigration.

The Conservative leader's comments came as new figures dealt a further blow to his long-held promise to reduce net migration to below 100,000, showing it rose from 209,000 in 2013 to 318,000 last year.

In a speech in London, he outlined new proposals to control immigration that will feature in a bill to be announced in next week's Queen speech, where the newly elected government will set out its agenda.

The proposals include making it a criminal offence to work illegally in Britain, a measure that would allow the police to seize wages from undocumented workers and increase pressure on the firms that hire them.

Mr Cameron also repeated a promise to restrict the right of European Union workers from claiming unemployment and in-work welfare benefits — a controversial measure given the bloc's rules on freedom of movement.

"I and many others believe it is right for us to reduce the incentives for people who want to come here," Mr Cameron told an audience in London.

The prime minister has promised to renegotiate Britain's relationship with the EU before holding an in-out referendum by 2017, and will start face-to-face discussions at a summit with EU partners in Riga, Latvia on Friday.

European Commission chief Jean-Claude Juncker has said he is ready to work with Mr Cameron but insists key principles such as freedom of movement are non-negotiable.

"I support free movement," Mr Cameron said, but argued "under the free movement rules, national welfare systems can provide an unintended additional incentive for large migratory movements".

"Changes to welfare to cut EU migration will be an absolute requirement in the renegotiation," he said.

EU workers coming to Britain jumps by 67,000

Immigration is a highly sensitive issue in Britain.

Opinion polling for the election repeatedly identified it as one of the top three most important issues for voters.

But while Britain remains part of the EU, its ability to place constraints on migration from within the bloc is restricted.

The latest figures from the Office for National Statistics show that 268,000 EU workers came to Britain in 2014, up 67,000 in a year, out of a total of 641,000 new arrivals.

Critics have questioned whether Mr Cameron's welfare changes would really help to reduce the influx of workers.

He pointed to the fact that 86,000 EU citizens last year arrived without a job offer to look for work, with the implication that some were drawn by unemployment benefits.

The prime minister's proposals to clamp down on illegal immigration are also unlikely to affect the official statistics, although they may prove popular.

His proposals include making all banks check their accounts against databases of people in the country illegally, and satellite tracking tags for foreign criminals awaiting deportation.

However the UK Independence Party (UKIP), which wants Britain to leave the EU to drastically curb immigration, said the proposals were a "smokescreen to mask today's appalling immigration statistics".

"We can't control our borders if 400 million people have an automatic legal right to come here," UKIP MP Douglas Carswell said.

"And that's the fundamental issue, and everything else is designed to distract us from that."

AFP/Reuters