SHADOW Chancellor John McDonnell estimates his plan to rebuild the economy in post-austerity Britain could generate 100,000 jobs in the North-East.

He pledged to create a National Investment Bank to pump £500 billion into the economy if Labour is voted into power at the next General Election.

Mr McDonnell said his party would create a network of regional banks with specialist local knowledge to sustain growth with a ‘Bank of the North’ in the region.

“These would break the logjam in the British financial system," he said.

“By being closer to a locality, and by making decisions based on local needs, they will be able to deliver the capital that our current financial system cannot.

“A ‘Bank of the North’ could help unlock the potential of the North of England, delivering finance for critical local infrastructure and supporting lending to high-potential local businesses.

“We should be aiming to create 100,000 additional well-paid, secure jobs across the North-East.”

He delivered his vision for the future at the National Glass Centre in Sunderland, a city which overwhelmingly rejected Labour’s argument to remain in the EU in last month’s referendum.

Mr McDonnell said: “The vote to Leave the EU presents every single one of us in politics with a challenge: to think big and adjust our policies rapidly to the new situation.

“So today I want to announce a major new commitment from Labour to the British people.

“A policy that will form the lynchpin of everything else we do to rescue Britain’s communities from decay; and to rebuild Britain’s industries after years of neglect.

“Britain’s relationship with Europe and the rest of the world has now been thrown open to question in a way that it hasn’t been for decades.

“Labour will not hesitate to defend the interests of working people in the UK, whatever the negotiations throw up.”

Mr McDonnell said former Tory Chancellor George Osbourne’s austerity measures were legacy of failure with public services cut to the bone with a million people in the world’s sixth largest economy using foodbanks.

He called on Theresa May’s Government to explain what it plans to do to stop the North-East’s trade relationships being damaged by Brexit negotiations.

He also said action must be taken to protect the £10 billion of EU regional funding that is now at risk of being lost.

Mr McDonnell said: “The UK has the worst regional inequalities of any current member of the European Union.

“While we have some of the richest places in the whole continent, with central London as the single wealthiest place in the EU, more than three-quarters of the country earn less than the EU average.

“We can’t tolerate a situation where too many of our people live in places that are being left behind by economic growth.

“Under a Labour government, nobody, no town, now community, no region will get left behind.”