The official bank rate has been lifted from 0.25% to 0.5%, after seven out of nine Monetary Policy Committee members vote for a rise.

Rain Newton-Smith, CBI Chief Economist, said: “While it’s the first rate rise in over a decade, it is only taking the rate back to the level seen in August 2016 and at 0.5% it remains near rock bottom.”

The rise will impact on an estimated 8.1m homeowners with mortgages, although small builders saw a silver lining and welcomed the move arguing it would help them chase late payment across their supply chains.

Richard Beresford, chief executive of the National Federation of Builders, said: “The interest rate rise will give SMEs more leverage when chasing late payments, but there is still some way to go.

“When the Bank of England previously cut interest rate in 2016, we asked the Government to increase efforts to tackle late payment more aggressively. Construction continues to have the worst payment record of any industrial sector, with SMEs owed more than £30bn in unpaid invoices.”

The Late Payment of Commercial Debts Regulations of 2013 allows companies that are owed payments to charge interest at 8% of the debt plus the Bank of England’s base rate.

Beresford added: “SMEs make up for more than 99% of the construction industry. This is an opportunity for SMEs to test the small business commissioner who can deal with late payment claims, confidentially if required.”