WATCH: No deal “would be disastrous for British businesses”, says Pennycook

Labour’s Matthew Pennycook has declared that leaving the European Union without a free trade agreement would be “disastrous for British businesses” amid reports of divides on the Labour frontbench over supporting a deal.

In an interview with Sky News this morning, the shadow minister for climate change was asked about reports that at least one shadow cabinet member would consider resigning if MPs are told to vote with the government.

Sky News’ Kay Burley asked: “A report in The Times this morning is suggesting at least one frontbench shadow minister [and] several shadow ministers will vote against and potentially resign if Labour supports the government’s free trade agreement for the EU – are you one of them?”

Pennycook replied: “Let’s just start by stepping back one second and saying there isn’t an agreement, you’re presuming there is. I really hope there is.”

UK government sources briefed last night that the chances of a post-Brexit trade deal with the EU were receding, as they claimed that EU negotiators had introduced fresh demands into the talks at the eleventh hour.

The negotiations have reportedly stalled over the issue of European fishing fleet access to British waters and the so-called level playing field provisions designed to prevent unfair competition on state subsidies and standards.

Pennycook added: “This is a really really important issue for the future of our country. It arouses passions among colleagues. There’s going to be, as you’d expect, a lot of debate about Labour’s position but I don’t think we can take a decision until we know there’s an agreement and what that agreement says.

“We’re having this discussion, if you like, in a vacuum. And, who knows, the reports overnight suggest that breakthrough isn’t perhaps as imminent as suggested.

“The most important thing is that we do what’s in the national interest, which is to get an agreement – because leaving without an agreement, I think, would be disastrous for British businesses and for investment into our country.”