Carillion could crash into administration as early as Monday if the government doesn't back a rescue plan

Courtney Goldsmith
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Carillion has built hospitals, roads and rail lines across the UK (Source: Getty)

Troubled construction firm Carillion could fall into administration as soon as Monday if the government does not back a rescue plan, according to reports.

Government officials are set to hold crunch talks on the firm's fate on Sunday, Sky News reported, quoting a source that called it a "make-or-break weekend".

"Without that commitment of support from the government, administration is all but inevitable," the source said.

Carillion is behind large government infrastructure projects including the HS2 high-speed rail, but the firm is grappling with £1.5bn of debt and a pension shortfall of £587m.

On Friday, the firm dismissed reports lenders had rejected a critical restructuring plan, saying it remained in “constructive discussions” with its creditors.

Insurance Insider also reported yesterday that trade credit insurers including Euler Herme have stopped writing new coverage for suppliers to Carillion, sending a signal the company is at risk of collapse.

It has previously been reported that EY is on standby for an administration.

In a tweet, Rachel Reeves, the chair of the Business, Energy and Industrial Strategy (Beis) select committee, called on the government to make an "urgent statement to Parliament to explain what it knew and when and what it plans to do now to protect jobs, investment in major projects and tax payers' money".

Carillion declined to comment on Sky News' report.

Read more: Trade credit insurers pull cover as Carillion "hangs by a thread"

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