The idea of involving trade associations in getting their members paid on time has been welcomed, with some reservations, by the Federation of Master Builders.

The idea was mentioned by Sajid Javid, the new Business Secretary of State, when he visited Bristol on 19 May.

He said: “Now, we’re going to widen the powers for representative bodies to act on behalf of their members to challenge grossly unfair payment terms. There’ll be a consultation on this later this year.

“And we will fulfil the manifesto pledge to set up a Small Business Conciliation Service to help small businesses settle their problems with large corporations.

“The purpose is to avoid expensive legal costs and maintain business relationships by reaching mutually satisfactory agreements.

“This model has worked in Australia. We will explore it, and other models, and find what works best here in the UK.”

Brian Berry, Chief Executive of the Federation of Master Builders, says: “Late payment has plagued the construction industry for far too long and I am therefore pleased that the new Business Secretary will be bringing forward legislation to tackle the problem.

“The last Government made some small steps in the right direction in terms of late payment – for example, a new duty imposed on all large firms from April 2016 to report on payment terms.”

Brian Berry welcomed the idea of widening the powers of representative bodies to challenge unfair payment terms. “We eagerly await further details on this as it is often difficult for small firms to highlight poor payment terms directly without biting off the hand that feeds them. This is partly why the problem has raged on for so many years.”