Jeremy Corbyn has come under intense pressure to shift Labour’s position on Brexit after 20,000 members demanded a say over the issue and former leader Neil Kinnock backed halting Britain’s EU exit altogether.

It is understood that the Labour leader will also be confronted by some in his shadow cabinet this week who want him to back remaining in the single market and customs union.

Speaking to the Observer, Kinnock said he had been angered by claims from Boris Johnson, the foreign secretary, that the NHS should benefit from the money saved by leaving the European Union. He said the reality was that “we should stop Brexit to save the NHS” or at the very least “mitigate the damage” by staying within the single market.

“Even contempt for ‘experts’ cannot obscure the evidence that the Johnson-led Brexit vote has already damaged and will inflict future harm on the NHS,” Kinnock said. “Meanwhile – vitally - Brexit has already diminished, and will continue to depress, the revenues on which the NHS depends.

“If Johnson really wanted the extra NHS spending, which is sorely needed, he wouldn’t be using the issue as a ploy to feed his lust for the Tory leadership but would be working to end Brexit.

“The truth is that we can either take the increasingly plain risks and costs of leaving the EU or have the stability, growth and revenues vital for crucial public services like the NHS and social care. Recognising that, we should stop Brexit to save the NHS – or, at very least, mitigate the damage by seeking European Economic Area membership.”

Labour is currently backing a “jobs first” Brexit, but what this would mean in practice has remained vague. The party was sharply criticised when it emerged that none of the eight policy commissions it has set up since the elections focuses on Brexit. Almost 20,000 people emailed the party last week urging it to use the exercise to consult members on the issue.

The pressure on Labour’s leadership comes as a second major donor pledged a six-figure sum to fund a campaign to stop Brexit and warned that he would “not be silenced” by attacks he believes are designed to discourage those opposed to Britain’s exit from the EU. Stephen Peel, an Olympic rower and former Tory donor, said he had not been put off by attacks aimed at George Soros, the billionaire financier who faced a backlash from Brexiters after giving £400,000 to a new anti-Brexit campaign.

He told the Observer he was giving £100,000 to Best for Britain, which is organising a grassroots anti-Brexit campaign, as it was “the most important political issue of a generation and one about which I deeply care”.

He added: “We have heard the strident calls from those against us to try and close down debate and silence discussion over the disaster that Brexit appears to be. I for one, will not be silenced and will do all I can to support groups such as Best for Britain who seek to engage people across the country and make the case for Britain to lead, not leave Europe.

“The key task is to empower the people of Britain, provide clear information on Brexit, and encourage them to make their views known to their representatives in parliament. How can this be anything but democratic?”

He said that his donation was designed to match smaller donations raised through crowdfunding. “It will help Best for Britain to campaign, inform and engage a broad electorate across Britain and seek to end the slow motion car crash that we are seeing right before our eyes,” he said.

News of the donation came as a key Labour policy meeting descended into chaos and acrimony yesterday, after an extraordinary row over an internal party post led to claims of bullying and gerrymandering.

The party had been due to elect a new chair for its National Policy Forum (NPF) at an event in Leeds but the vote was put off at the last minute, with some claiming it had been shelved because a candidate not favoured by leading Corbyn supporters was set to win. The party said the vote had simply been put off to ensure it complied with its rules. In a sign of the simmering tensions still inside the party, the stand-off led to angry exchanges, while a senior official was ushered away from the event’s podium after attempting to put the issue to a vote. It led to the meeting being adjourned and a speech by the Labour leader being delayed.