Labour would not set money aside to prepare for a “no deal” Brexit if it were in power, shadow chancellor John McDonnell has said.
Mr McDonnell said it would be a “waste of resources” because the party would get a “good deal” out of negotiations with the European Union.
The Government has committed £500 million for Brexit preparations, with more than £250 million additional funding in 2017/18, but this is not exclusively for a scenario in which Britain leaves without a deal.
According to reports, some Cabinet ministers have been urging Chancellor Philip Hammond to commit more money to preparing for no deal to strengthen the UK’s hand in talks by showing it is ready to walk away.
But Mr McDonnell told BBC Radio 4’s Today programme: “What we have said all the way along is that we think we can get a good deal.
“That means we don’t have to waste resources on preparing for a no deal.”
He went on: “We don’t think we need to set money aside because we can get a good deal which will maintain tariff-free access, allow our economy to grow and work in a new collaborative relationship with our European Union partners.
“And the reason that the Government is having to set money aside, no matter what the sums are, is because a number of them in that Cabinet are planning for a no deal, some of them want us to be a tax haven off the edge of continental Europe and are willing to sacrifice our manufacturing base, we’re not willing to tolerate that.”
John McDonnell (Stefan Rousseau/PA)
Mr McDonnell also refused to say how much Labour would offer for the so-called “divorce” bill, which could run into tens of billions of pounds.
As the EU demands clarity on the UK’s position to unlock trade talks, the shadow chancellor said: “For months now we’ve been calling for the Government to actually be open and transparent about what they genuinely think the liabilities are, have an independent assessment, and then we can all share that information and have a proper debate. Why can’t they do that?”