He is the first chief of a publicly listed contractor to see his total pay package exceed the £1m mark, although top executives at several of the major private contractors are regularly paid more.

The 4.5% rise included a £261,856 annual bonus for the boss of Britain’s biggest contractor, who is presently driving through a major three-year efficiency and cost-cutting plan.

Tyler’s basic pay rose to £685,000, with around £104,000 in pension supplements and benefits in kind taking his pay through the £1m mark for the first time.

All directors received an average basic salary rise of 3.7% last July in line with the general group pay awards, according to Balfour Beatty’s annual report.

Deputy chief executive Anthony Rabin was paid £717,592 in 2011, although his role will be dropped in July when he retires and chief operating officer Andrew McNaughton takes on his duties for the Infrastructure Investment Division.

Naughton’s total remuneration package rose 7% last year to £647,511.

Tyler’s efficiency programme aims to deliver £50m in savings by 2015.

Part of this is expected to be clawed in from a shake-up at the construction services division, which is braced for big redundancies after the 12,000 strong UK workforce was put on restructuring consultation.