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John McDonnell warns against 'bankers' Brexit' John McDonnell says Tories want 'bankers' Brexit'
(about 4 hours later)
Labour is warning the government against carrying out a "bankers' Brexit", urging it not to ignore the needs of small businesses. Labour has accused the government of favouring a "bankers' Brexit" at the expense of the wider economy.
Shadow chancellor John McDonnell says ministers want to turn the UK into the "Singapore of the North Atlantic", offering "low taxes for the few". Shadow chancellor John McDonnell said the Tories wanted to "cut special deals" for the financial sector.
He will also raise concerns that "hard-won" employment rights are at risk. Asked about Nissan's announcement of investment in Sunderland, he said the government had a "chaotic" approach on a "factory-by-factor" basis.
Prime Minister Theresa May has promised a Brexit deal "that is right for the UK". And he said Labour would not make "cynical promises" to reduce immigration post Brexit.
The government has said it will trigger Article 50 of the Lisbon Treaty - getting formal exit talks with the European Union under way - by the end of March next year. Prime Minister Theresa May has promised a Brexit deal "that is right for the UK" and ministers have accused Labour of offering "division and incompetence" on the EU.
Ministers say they will not provide a "running commentary" and that their negotiating stance will not be revealed until nearer that date. The government is refusing to offer a "running commentary" on its negotiating position for exit talks, which are due to begin formally by the end of March.
Mr McDonnell, in a speech to the Institution of Mechanical Engineers in London on Thursday, will argue that Mrs May could decide to create a "bankers' Brexit at the expense of the rest of the overall economy". In a speech at the Institution of Mechanical Engineers in London, Mr McDonnell said: "The Tories want to cut special deals for bankers."
He will add that it is impossible to "take on blind trust that she will seek a Brexit deal that benefits everyone in our country and not just Tory special interests". He warned that the negotiations should benefit everyone in the country and "not just Tory special interests", describing government preparations for negotiations as "shambolic".
'Division and incompetence' He added: "Already, Tory cabinet ministers are looking to cook up special deals for their friends in the City of London, while Tory backbenchers want to attack hard-won workplace rights.
Describing government preparations for negotiations as "shambolic", he will say: "Already, Tory cabinet ministers are looking to cook up special deals for their friends in the City of London, while Tory backbenchers want to attack hard-won workplace rights.
"They'll cut a deal for finance, but ignore our small businesses and manufacturers.""They'll cut a deal for finance, but ignore our small businesses and manufacturers."
Mr McDonnell will add: "They want to turn Britain into a Singapore of the North Atlantic - not because they want to match the huge public housing provision that country offers for the many, but because they want to match the low taxes for the few." 'What about us?'
Labour has faced calls to clarify its position on EU migration and the free movement of people. Reflecting on the Labour leadership's referendum campaign - which was criticised as lukewarm by some of the party's MPs - he said he believed the EU was "a flawed institution" but that it had been better to fight for reform than to leave.
Leader Jeremy Corbyn has rejected migration curbs but other senior party figures have suggested numbers should be reduced. As for the outcome of the vote, the shadow chancellor added: "We should not pretend the referendum result can be undone."
Labour would take back control from the EU of the "economic levers of power" like state intervention, Mr McDonnell said, and would protect the financial sector but expect it to finance other industries.
Taking questions afterwards, he was asked about whether Nissan's announcement - that it will build both the new Qashqai and the X-Trail SUV at its Sunderland plant - disproved his "bankers' Brexit" attack.
"This is chaos at the moment," he said, accusing the government of doing deals "secretly behind closed doors" on "individual factory deals".
"What other manufacturers are going to say is 'what about us?'"
'Incompetence''Incompetence'
Speaking on BBC Radio 4's Today programme, Mr McDonnell said free movement would "formally" come to an end when the UK leaves the EU, but added: "We will still need to ensure that there is movement...both in terms of UK into Europe and the other way round" Mr McDonnell was also challenged to clarify the party's position on immigration, with some senior party figures suggesting numbers should be reduced after Brexit.
He said Labour favoured "balanced migration" and that the vote to leave the EU reflected worries about people's living standards.
Speaking earlier on BBC Radio 4's Today programme, he said the free movement of people would "formally" come to an end when the UK leaves the EU, but added: "We will still need to ensure that there is movement... both in terms of UK into Europe and the other way round."
He said "unscrupulous employers" should not be able to use immigration to undercut wages.He said "unscrupulous employers" should not be able to use immigration to undercut wages.
Reacting to Mr McDonnell's comments, David Gauke, chief secretary to the Treasury, said: "All Labour can offer the British people is division and incompetence. Reacting to his speech, David Gauke, chief secretary to the Treasury, said: "All Labour can offer the British people is division and incompetence.
"They don't believe Britain can thrive outside the EU - and after the economic mess they left behind last time, no-one should ever trust them again with the economy."They don't believe Britain can thrive outside the EU - and after the economic mess they left behind last time, no-one should ever trust them again with the economy.
"The Conservative Party will deliver the right deal for the whole United Kingdom as we leave the EU and build an economy that works for everyone here at home.‎""The Conservative Party will deliver the right deal for the whole United Kingdom as we leave the EU and build an economy that works for everyone here at home.‎"
Mrs May has promised to make Brexit "as smooth as possible" for the UK, adding that, with employment at a record high and inflation at a record low, the UK is in a good position.
She added: "What matters is that we are clear about the deal we want to get for the British people. That's the right deal, a deal that ensures that British businesses have the maximum opportunity to trade with and operate within the European Union."