Balfour Beatty in the box seat for Carillion's Midland Met hospital

Balfour Beatty looks set to be the favourite for the Midlands hospital left stranded by Carillion's collapse last year even though it has not yet submitted a compliant bid.

The country's biggest contractor has been working on the scheme since last autumn after being parachuted in by the NHS trust responsible for it to carry out a number of jobs including making it weather-proof.

In papers published ahead of this week's meeting of the Sandwell and West Birmingham Hospitals NHS trust board, it was revealed Balfour was in talks in the hope of coming up with a compliant bid in the coming weeks.

In his chief executive's report, trust boss Toby Lewis said: "Our bid process is finalising a final contractor proposition from Balfour Beatty against our specification for quality, price, risk and time.

"This will be incorporated into the preferred bidder final business case later in May for Whitehall approval in June."

But Lewis said the trust "[does] not have a compliant bid from Balfour".

Lewis said a "good dialogue continues to meet our [the trust's] longstanding needs", which include the bid coming in at under £267m.

The papers also said the successful bidder would only be paid for the costs of the works completed, not the target price.

They said: "If the bidder delivers the contract for less than the target price, the difference will be shared with the trust as a gain share to incentivise the bidder to deliver best value. The bidder will pay any construction costs that exceed the target price."

But the trust will hold a £38m contingency fund in case of any unforeseen events which are deemed to be out of the scope of the contract and to cover known risks which are the trust’s responsibility.

Lewis also said the team was working to develop plans for how potential changes to NHS boundaries would factor into the cost and schedule for completing the project.

The trust is hoping the Midland Met will be finished by December 2021, so it can be operational by May 2022.

When Carillion was appointed, the £430m job was due to be finished by mid-2018.

This week's meeting of the trust board will be held on 2 May.