The UK government should seek to "end" the free movement of people from the EU with a "phased transition", a group of peers said on Monday (6 March). The cross-party EU Home Affairs Sub-Committee said the move would help avoid a Brexit "shock" for UK businesses.

"Crucial sectors of the economy depend on EU migrant labour, so it is essential that any changes don't endanger the vibrancy of the UK economy. We therefore recommend a phased transition to avoid the short-term shocks to particular sectors," said Baroness Prashar, the chair of the sub-committee.

Prashar also said the peers were "struck by the weaknesses and gaps" in the UK's migration statistics.

The most recent Office for National Statistics (ONS) report estimated that net migration to Britain was at more than 273,000 in the year to September 2016, well above the government's "tens of thousands" target.

"Different measures of who counts as a migrant sow confusion in public debate, and contribute to a gap between perceptions and reality," Prashar added.

"If the government's ultimate objective is to reduce dependency on low-cost migrant labour, it needs to look beyond immigration policy. We need a reassessment of the government's industrial strategy, its education and skills policy and its public spending plans."

The committee also recommended that the government should not apply the UK's non-EU work permit system to EU nationals. Private and public sector employers told the peers that such a policy would "disproportionately affect" some companies' ability to sponsor EU workers.

Elsewhere, in a blow to Theresa May's plan to introduce immigration curbs, the group said the restoration of national control over EU migration "may or may not" deliver a reduction in overall net migration.

The report comes just weeks before May plans to invoke Article 50 and trigger Brexit talks. The government was recently defeated in the House of Lords when peers voted to unilaterally guarantee the residency rights of the more than three million EU nationals in the UK.

A Home Office spokesperson said: "Once we have left the European Union it will be the Government that sets our immigration rules. We are currently considering the various options as to how EU migration might work once we have left and it would be wrong to set out further positions at this stage."