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Sam Allardyce admits financial restrictions next season may result in West Ham not being able to afford to sign Andy Carroll on a permanent basis.

The Hammers have the option to sign the 24-year-old on loan Liverpool striker for around £17million, although reports last week suggested they were hoping to bring that down to nearer £10million.

But Allardyce has revealed that a deal will only be done if the new financial fair play rules that come in to play next season don’t have a huge impact on the club’s transfer budget.

He told Sky Sports: “The hardest thing is the overall package and making sure it’s sustainable. I point to financial restrictions being implemented next season that will blow the whole deal in one go.

“Someone will have a bigger budget than us probably but that is what is going to happen.

“In one fell swoop the financial restrictions mean we won’t be able to sign Andy Carroll from Liverpool because it is too expensive, even if we wanted him, which we do.”

It is believed Carroll would have to take a significant cut in his wages in order to make it more affordable for West Ham to secure his signature, but reports have suggested recently that Liverpool may use him in a deal to sign Newcastle’s Hatem Ben-Arfa in the summer.