Shadow chancellor John McDonnell has insisted that it is the "objectives rather than the structures" of Brexit which are important, as he was challenged on his party's policy.

Mr McDonnell was asked to explain Labour's approach to leaving the European Union during an appearance at the Edinburgh Festival Fringe after an audience member said it was "very unclear as to what the thinking is".

There has been confusion over the party's view on European single market and customs union membership as negotiations to leave the EU continue.

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Leader Jeremy Corbyn has previously said Britain would leave the single market on Brexit while other leading party figures - such as shadow Brexit secretary Sir Keir Starmer and Mr McDonnell - have said all options are on the table.

Mr McDonnell said Labour's priority was "the protection of jobs and the economy", while there are also "issues around freedom of movement".

"Therefore we've got to negotiate some form of managed migration system, but one in which we don't cut our nose off to spite our face by undermining our economy," he said.

"The issues around what structures, whether we're in the single market or the customs union or not ... our view is that it is the objectives rather than the structures which are important."

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Mr McDonnell, who was speaking at an "In Conversation" event chaired by comedian Susan Morrison, also warned that the tone of the Brexit negotiations needs to change, adding that the UK Government is "in chaos".

"We'd change the tone - we would get into the negotiations on the basis of mutual respect and mutual interest," he said.

"We'd look at how we would protect our economy and we'd look at how we'd introduce a fair managed migration system, and that way we think we could overcome many of the dis-benefits of the EU that are perceived and maintain many of the benefits themselves."