In response to Philip Hammond’s statement, Brian Berry, chief executive at the Federation of Master Builders (FMB), said: “The chancellor’s announcement of a consultation to tackle the scourge of late payment … should mark a turning point on this issue.

“We should use this opportunity to bring about a spring clean of payment practices which negatively impact on small business.”

The FMB found that one London-based small building firm was paid more than 270 days late by a construction giant. 

“Now is the time to move away from these unsustainable business models which threaten the existence of many firms and their supply chains,” Brian added.

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“This announcement today should be followed by a fundamental rethink ending in the permanent abolition of late payment terms and the exploitative use of retention payments.”

The chancellor also announced that funding for the housing growth partnership will more than double, while up to £80m of finance will be released to SME firms looking to take on an apprentice.

“With Brexit looming large on the horizon and the construction industry facing a chronic skills crisis, it’s of the utmost importance that more skilled workers begin to join the sector. 

“An additional £50m to support T-level training will further aid this aim.”