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Labour calls for clarity from Government on Nissan Brexit 'deal'

Labour has called on the Government to reveal exactly what it told Nissan, amid claims the firm was given written guarantees it would be compensated if the EU imposed tariffs on its cars post-Brexit.

The Government insists it was "convincing rather than compensation" that persuaded the carmaker to boost production at its Sunderland plant.

Downing Street has suggested written assurances were given to Nissan, with a spokesman saying the Government and the company had communicated in "all forms" before Thursday's announcement.

But he reiterated there was "no compensation package" and "nothing about tariffs", while Nissan also said there was no special deal for the firm.

The Government earlier told Sky (Frankfurt: 893517 - news) 's Darren McCaffrey it was "convincing rather than compensation" that secured the investment.

However, shadow Brexit secretary Keir Starmer has urged Number 10 to reveal more details about these discussions.

He said: "It's welcome that the Government have done a deal with Nissan that protects jobs and supports the local community and economy.

"But that deal needs to be accompanied by transparency and accountability.

"We can't have the Government doing deals that affect jobs and the future of our economy without telling the public or Parliament what the basic terms are.

"They now need to spell that out and strike a wider deal that gives certainty to businesses, workers and communities across the country."

Former business minister Anna Soubry, who held the initial post-Brexit talks with Nissan while she was in government, said she would be "very surprised" if there was no guarantee of compensation.

She (Munich: SOQ.MU - news) told the BBC David Cameron's government was "very seriously" looking at compensation for any duties imposed on the industry post-Brexit.

Iain Wright, a Labour MP and chairman of the Commons Business Select Committee, said Business Secretary Greg Clark should appear before the watchdog to face questions.

He told Sky News: "In very general terms I think the Government shouldn't betray commercial confidences, but should set out the principles, the criteria, by which this assistance, this reassurance and support is provided, and how that will be applied to other companies and to other sectors.

Mr Clark told the BBC on Thursday that no financial favours were offered, saying: "There's no chequebook. I don't have a chequebook."

The controversy was triggered when Nissan boss Carlos Ghosn said the company's decision was driven by Government "support and reassurances".

It was the term "support" that raised eyebrows, as the firm had threatened to put the brakes on new UK-built models following the EU referendum if there were no assurances on compensation.

Nissan's decision to build its next-generation Qashqai and add production of the new X-Trail model at Britain's biggest car plant will secure more than 7,000 jobs and 28,000 more in the supply chain.

Prime Minister Theresa May has hailed it as proof the UK is an attractive investment hub despite the uncertainty caused by the Brexit vote.

Other car manufacturers have also been reacting to the deal.

BMW (EUREX: BMWE.EX - news) said it does not have to make any decisions on UK investment imminently and so it remains "business as usual" for its British operations.

Ford said tariffs on cars post-Brexit could increase prices and limit choice for customers.

"Brexit is the biggest headwind we face as a European business," it said.

"Its impact will be about $200m (£164m) this year, and potentially around $600m (£492m) next, and there's additional risk if the exchange rate weakens further."