The shadow chancellor, John McDonnell, has called on the government to use its position as majority shareholder of Royal Bank of Scotland to block planned branch closures.

McDonnell said the government should use its stake to force RBS, which holds its annual shareholder meeting in Edinburgh on Wednesday, to act in the public interest and accused it of “dancing to the tune of the bank’s board”.

Earlier in May RBS revealed plans to close 162 branches in England and Wales with the loss of nearly 800 jobs. The bank said the move was a response to more people using online banking.

RBS also plans to shut 62 branches in Scotland, a move which the House of Commons Scottish affairs committee called “a devastating blow to the affected communities”.

RBS chief executive, Ross McEwan, is also likely to face questions about when the bank will restart dividend payouts. The last hurdle to resuming dividends was removed last month when RBS agreed to a $4.9bn (£3.7bn) settlement with US authorities over the sale of toxic mortgage bonds in the runup to the financial crisis a decade ago.

The settlement will also allow the government to restart its programme to sell down its 71% stake in the bank. However, sales will be made at a substantial loss because when the government bailed out the bank it paid 502p per share. They are now changing hands at around 280p.