Labour rebels: Black Country MPs defend disobeying Corbyn

Ian Austin and Adrian Bailey were among 21 who disobeyed the party whip and abstained in a vote on the government's 'fiscal charter', which carries the obligation to run a surplus once the deficit is cleared.

West Bromwich West MP Mr Bailey said it was party policy until just two weeks ago to back the charter and said changing course would paint Labour as untrustworthy on the economy.

Shadow chancellor John McDonnell urged Labour MPs to oppose the Government's updated Charter of Budget Responsibility, having previously said they would support the 'meaningless' document.

Thirty-seven Labour MPs failed to vote, although 16 MPs are understood to have had permission to stay away from the lobbies, leaving 21 rebels including former shadow cabinet ministers Chris Leslie and Tristram Hunt.

Mr Bailey said: "While I completely agree with the shadow chancellor that there is a different way to deal with the public sector deficit that backs growth, not austerity, our own internal polling demonstrates Labour lost the election because of our credibility on economic management."

Mr Bailey stressed he was not a rebel.

He said: "Normally I describe myself as a very loyal backbencher.

"I've voted against the front bench only on a couple of relatively minor issues in the past but I've never not supported them on key issues."

Before abstaining on the vote, Dudley North MP Mr Austin said: "The Chancellor is completely wrong. The objection to the game he is playing and the trap he thinks he has so cleverly set is that he has completely failed to hit all of the promises and all of the targets that he has established.

"Instead of indulging in this ridiculous game-playing, he should be concentrating on preparing Britain to weather the international storm and preparing for the problems we could face as a result of the slide in China."

Chancellor George Osborne replied: "That is precisely what we are doing. We are precisely preparing Britain to weather the storms. We came in five years ago. We promised to turn this economy around. We promised to take Britain back from the brink of disaster. And do you know what? We have a record number of people in work. A record number of children are no longer in workless households. We have the gender pay gap at the lowest rate in its entire history.

"Inequality is down, child poverty is down and the shambles we were left by the Labour party is what we are clearing up right now and we will continue to do so."

Dudley South Conservative MP Mike Wood added: "The public recognise what Labour front benchers seek to deny: that we cannot safeguard people's jobs and mortgages without a secure and stable economy; that we cannot go on spending far more than we earn for long without getting into a lot of trouble; and that there is absolutely nothing progressive about saddling our children and grandchildren with enormous debts over which they have no say."

Gavin Williamson, MP for South Staffordshire, said: "The strategy of Labour is to tax, tax, tax, borrow, borrow, borrow, spend, spend, spend. But some of their sensible MPs were prepared to put the national interest before their party."

Mr McDonnell, who was barracked by Tory MPs during his Commons speech, repeatedly acknowledged the U-turn was 'embarrassing' as he set out the party's new position on the public finances.

He told the Commons that he had not changed his mind on the 'need to tackle the deficit' but on the 'parliamentary tactics'.

Mr Osborne's new charter commits the Government to running an overall budget surplus by 2019 and every year from then on in "normal" times. It was passed by 320 to 258, a majority of 62.