Labour has been urged to lay out a credible plan for the future of British Steel, as the government spending watchdog warned of the “startling” costs of keeping the struggling manufacturer in business with no end in sight.

British Steel was taken into public ownership in July to protect “the future of steel production”, 15 months after the government stepped in to prevent the closure of its steelworks in Scunthorpe and the loss of 4,000 jobs.