The Chinese rescue of British Steel is threatened with collapse, casting Boris Johnson into an immediate crisis in the industrial heartlands that delivered his decisive election victory.

Talks with the potential buyer Jingye are this weekend at risk as a deadline to finalise terms ­approaches, according to Whitehall sources.

Officials and accountants from EY are understood to be in informal discussions with alternative saviours for British Steel as fears for the Scunthorpe works’ future mount once again.

The Government denied it was in formal talks with other interested parties.

British Steel has been propped up by the taxpayer since its previous owner, the specialist turnaround fund Greybull, declared the business insolvent in May. Sources said the Government could be forced to justify a £500m bill to keep the furnaces going for eight months as rescue talks have repeatedly faltered.

The potential collapse of talks between the Official Receiver and ­Jingye would put at risk the livelihoods of 4,000 steel workers and 20,000 supply chain jobs. Scunthorpe, in Lincolnshire, was among the former ­Labour constituencies to turn to the Conservatives last week.