John McDonnell Labour conference

The Post Office could be used to create a new national bank under plans outlined by the Labour Party.

Shadow chancellor John McDonnell said using 3,600 Post Office branches would enable it to create Post Bank to protect community interests while High Street banks continually close branches.

Mr McDonnell said Labour would also seek to retain Royal Bank of Scotland under public ownership and create a bank to invest in infrastructure.

The shadow chancellor said: “Poor access to local bank branches hurts our town centres and local communities, particularly affecting elderly and more vulnerable customers, as well as damaging the ability of local small businesses to invest.”

The National Investment Bank and Regional Development Bank would invest in infrastructure, small businesses and green tech projects through a £250 billion fund.

Mr McDonnell said: “Finance is the central nervous system of the economy. It directs investment, deciding which businesses and projects get off the ground and which fail.

“For too long, this vital part of our economy has been solely in the hands of the big banks and the speculators.”