Jarvis' profit warning last month, its restructuring and project delays have put the firm under the spotlight of the Project Review Group at the Office of Government Commerce.
A source close to Whitehall said: "It's all getting rather unpleasant. Bits of government are looking very hard [at Jarvis] and the OGC has an internal review."
A spokesperson for the OGC said that reviews of contractor performance was a regular task, but it has been suggested that one of the agency's leading officials has been spending up to two days a week of his time reviewing Jarvis' projects.
The OGC spokesperson said: "The OGC keeps under review the performance of all key suppliers to central civil government and where appropriate the wider public sector. There is an increasing emphasis on selecting and working with suppliers who can meet government's delivery commitments to cost, time and quality."
Questions over Jarvis' performance were raised in the press last month prior to its warning that profit would be £12m below market expectations. Delays and quality complaints were found in schools contracts including Kirklees, Brighton & Hove, Wirral and Haringey. Subcontractors have also complained about Jarvis' payment policies.
You can expect OGC to take interest in Jarvis after Sutton’s departure
Jarvis has since defended its record, but Andrew Sutton, chief executive of the group's accommodation services division that deals with the schools contracts, resigned earlier this month. He has been replaced by commercial director Rob Johnson.
A government source said: "You can reasonably expect OGC to take close interest in Jarvis in light of Mr Sutton's departure and Mr Johnson's elevation. There has been some concern about Jarvis for several months."
A Jarvis spokesperson said: "We have heard nothing from OGC to substantiate this suggestion. However, we are very happy to discuss our work with OGC and be judged on our record of success."
The news comes in the week that a report on reforming the civil service by OGC chief executive Sir Peter Gershon was leaked to the media. The report recommended cutting 80,000 jobs and the creation of agencies to improve procurement.
Gershon leaves the OGC at the end of April, and sources suggest that his replacement works in the City and is currently thrashing out terms.