Britain will refuse to sign a free trade deal with the EU unless it includes curbs on free movement David Cameron told leaders as he admitted it was immigration fears which led to the Brexit.

In his final Brussels summit, Mr Cameron warned his EU counterparts that nothing less would be acceptable to the British public after a decisive referendum result.

He told them it was clear that the UK had voted for Brexit because the public thought immigration was out of control.

In his final Brussels summit, David Cameron warned his EU counterparts that nothing less would be acceptable to the British public after a decisive referendum result

The Prime Minister’s intervention – less than a week after the historic vote to Leave – blamed Britain’s departure on Angela Merkel and other foreign leaders who refused to give him any worthwhile reforms on immigration.

But it also had huge ramifications for the Tory leadership battle.

The field of candidates – many of whom voted to remain in the EU, and preserve unfettered free movement – will now come under pressure to follow Mr Cameron’s belated lead that Britain must take back control of its borders.

Yesterday, Boris Johnson made clear to the Tory right that he would end EU free movement. He had been accused of backsliding after suggesting that immigration was not the main reason why people voted Leave.

Theresa May is also expected to confirm her commitment to curbing free movement. The Home Secretary has argued in the past that migrants from the EU should have secured jobs before moving to Britain and should not be allowed to come here to hunt for work.

Yesterday, Boris Johnson made clear to the Tory right that he would end EU free movement. He had been accused of backsliding after suggesting that immigration was not the main reason why people voted Leave

However, Angela Merkel set the stage for a major battle over the issue yesterday by saying Britain could not ‘cherry pick’ what it wanted during negotiations to quit the EU. Mr Cameron delivered his warning to the 27 other EU leaders over dinner last night, as he explained the events that led to Brexit.

A senior Government source said: ‘He believes that one of the key issues in the referendum campaign, and therefore why a lot of people voted to leave, was this sense that there was no control on the scale of immigration or free movement.

‘It is going to have to be worked out as part of any new relationship between Britain and the EU.’ His comments were a recognition, months too late, that his renegotiation with Brussels went nowhere near far enough.

European leaders have reacted with a mixture of fury and sorrow – one accusing the UK electorate of ‘ripping off one of the EU’s wings’.

Last night, an insider said Mr Cameron told the 27 leaders that, if they are to secure a trade deal with the UK, free movement will have to be restricted.

A No10 source said: ‘In his view it is in the interests of the UK and the EU that we have as close an economic relationship as possible. The key to staying close is to look at free movement and how do you address that issue. If we want a close relationship we cannot shy away from that issue.’

Mr Cameron had originally wanted curbs on free movement as part of his renegotiation with Brussels, but caved in the face of opposition from Germany.

Mr Cameron had originally wanted curbs on free movement as part of his renegotiation with Brussels, but caved in the face of opposition from Germany

In the end, he ended up with a watered down deal which limited the access which EU migrants have to in-work benefits, plus a complex regime of curbs on child benefit.

The deal, secured in February, was widely derided as ‘thin gruel’ by Tory MPs. The new terms ceased to exist when Britain voted to Leave.

During the referendum campaign, ex-Cabinet minister Iain Duncan Smith claimed that Germany had a secret veto over Mr Cameron’s EU renegotiations and used it to kill plans for an emergency brake on migrants.

Yesterday, ahead of dinner with the PM, Europe’s leaders continued to insist there is no prospect of any changes to free movement.

Mrs Merkel said she expects that Britain will want to maintain ‘close relations’ with the EU once it leaves, but warned it cannot expect a business-as-usual approach.

She added: ‘Whoever wants to leave this family cannot expect to have no more obligations but to keep privileges.’

However, she is under pressure from German manufacturers – the car industry in particular – to strike a trade deal with the UK.

Xavier Bettel, the Luxembourg prime minister, said Britain and the EU could be ‘married or divorced but not something in between’.