LABOUR is “moving towards” backing a second EU referendum, John McDonnell has suggested at the end of a week in which the party has lost nine of its MPs, in most cases because of its stance on Brexit.

Labour's position, thrashed out at the party's conference last year, keeps open the option of a so-called People's Vote if Theresa May is unable to get a deal through Parliament and there is not a general election.

But Mr McDonnell, in an interview with London’s Evening Standard, suggested the leadership was now warming towards backing a second poll.

"On the People's Vote, we've kept it on the table and we're moving towards that," declared the Shadow Chancellor.

He said Labour was "moving into implementation stages around our conference decision, around the People's Vote".

A compromise plan put forward by Labour MPs Peter Kyle and Phil Wilson could present a route to the party leadership supporting a vote.

The two backbenchers have devised a plan to support Theresa May's Brexit deal on the condition it was later put to a confirmatory public vote. The Commons could be asked to vote on the Kyle-Wilson amendment next week.

Mr McDonnell said that any referendum would have remaining in the EU as the alternative to the Prime Minister's final deal.

"If we were going on a People's Vote based on a deal that has gone through Parliament in some form, if that got voted down, then you'd have status quo and that would be Remain," he explained.

The Shadow Chancellor made clear that if it was an option, then "I'd campaign for Remain and I'd vote for Remain".

It is believed that Tom Watson, the party’s deputy leader, and Sir Keir Starmer, its Shadow Brexit Secretary, are supportive of the push for a People’s Vote, should a general election not materialise.

But Jeremy Corbyn and his close ally, Unite’s Len McCluskey, appear to remain unconvinced given the widespread support for the Leave vote in some of Labour’s heartlands.

A spokesman for the People's Vote campaign said: "It looks like Labour will test whether its Brexit plan has the support of Parliament next week.

"It deserves scrutiny but, with the Prime Minister effectively ruling out a customs union, John McDonnell and other senior Labour figures recognise there will be only one option left for them which is in line with party policy.

"If they back compromise proposals to put any final Brexit deal to the people, it will help unite their party as well as avoid the catastrophe for their constituents of a no-deal departure from the EU," he added.

Meanwhile, Mr Corbyn set out his Brexit plans in Madrid at the Party of European Socialists meeting.

The Labour leader said: "The damaging deadlock on Brexit must be broken and following my discussions with European Union leaders and officials, I am in no doubt that Labour's alternative plan is credible and could be negotiated with the EU."

He added: "None of us can allow Britain's exit from the European Union to be exploited by the whims of big business and the super-rich.

"Companies who shift their accounting operations back and forth across borders to minimise their tax bills are carrying out daylight robbery.

"By failing to crack down on aggressive tax avoidance, Theresa May is allowing the British public to be ripped off and exposing the kind of Brexit she and her party want to deliver."