A year ago the idea of Rangers Football Club going into administration was almost unthinkable.

Now even liquidation is a possibility. Nobody should celebrate that, least of all their Old Firm rivals.

The Scottish Premier League Champions lodged papers at the Court of Session in Edinburgh yesterday, indicating that the 140-year old club plans to go into administration. The move ends months in which it has been rocked by rumour and speculation, after Scots-born entrepreneur Craig Whyte took over, promising to pay off its £18 million bank debt and spend millions on players. But in the intervening nine months, Mr Whyte has raised more questions than he has answered about the club's finances.

The outcome of a historic £49m tax dispute is expected imminently. Even if it goes in Rangers' favour, survival is not guaranteed. There are further questions about a £24.4m loan secured against future season ticket sales and its associated VAT bill. Last week the former Rangers club chairman, Alastair Johnston, called for an Insolvency Service investigation into Mr Whyte's take-over of the club, the day after a sheriff described the entrepreneur's evidence in court as "wholly unreliable".

It is clear now that Mr Whyte bit off more than he could chew and, having unwisely gambled on Rangers going into Europe this season, has been running the club on a hand-to-mouth basis.

Much of the blame for the club's present plight falls on others. In pursuit of cups, titles and glory, Rangers has overspent for years. In 2000 former owner Sir David Murray boasted: "For every £5 Celtic spend, we will spend 10". For a long time that has been the way with football. Hearts ruled heads and banks let clubs off the hook. In a global economy that appeared to offer perpetual growth, debt did not seem to matter. We now know the banks themselves were run on the same basis. Many of those who occupied the stands had a similar attitude to their own finances, maxing out on credit cards and buying dream homes they could not afford.

The situation in Scotland has been aggravated by the proximity of the English premiership, the richest league in the world, with its lucrative Sky Sports deal and capacity to suck in the best players with "Sky-high" wage offers. Scottish clubs could not compete with that, especially since the collapse of Setanta.

Though many Celtic followers may be jubilant, ironically they have almost as much to lose. Despite the recent focus on the bile of sectarianism in football, this world-famous rivalry needs both halves to flourish. Celtic would not be Celtic without Rangers. Indeed, in search of more challenging competition, it might soon seek refuge south of the Border. The loss to Scotland would be incalculable. The Old Firm alone is worth an estimated £120m to the Scottish economy. For other SPL clubs, visits by one of the big two amount to a pay day. The same applies to lower division clubs lucky enough to draw one of them in cup competitions.

Yesterday Mr Whyte promised Rangers supporters that the club could emerge from its enforced restructuring "stronger and financially fitter". Can we believe him? Even with a 10-point deduction, Rangers is likely to finish second in the league, but the clock is ticking already if the club hopes to play in Europe next season. Sympathy must go to the fans, who must feel that their club, the mighty Glasgow Rangers, has been made a laughing stock by recent events. They deserve better. Credit too must go to manager Ally McCoist, who has shown tremendous loyalty and commitment to the club in such trying times.

Many great clubs have teetered on the brink of extinction and survived to tell the tale. We should wish the same for Rangers Football Club, whatever colour scarf we wear.