The Federation of Master Builders (FMB) has said that the UK government made the right decision to row back on its plan to hike up national insurance contributions for the self-employed.

Chancellor of the Exchequer Philip Hammond was forced to abandon one of his bolder measures in last week’s budget after it was revealed that he was breaking pledges in the Conservative’s election manifesto.

Performing a swift U-turn, Mr Hammond told the House of Commons: “The measures I announced in the budget sought to reflect more fairly the differences in entitlement in the contributions made by the self-employed. The government continue to believe that addressing this unfairness is the right approach. However, since the budget, parliamentary colleagues and others have questioned whether the proposed increase in class 4 contributions is compatible with the tax lock commitments made in our 2015 manifesto.”

Welcoming the reversal, Brian Berry, FMB chief executive, said: “At a time when we need to do everything we can to ensure economic stability, this would have been a destabilising tax increase which would have hit large numbers of tradespeople on quite modest incomes. That would have felt very unfair and would have been in danger of undermining the entrepreneurial spirit Britain will need to rely on as we approach the economic uncertainty of Brexit.

“There is an important debate to be had about how we ensure an even playing field in the taxation of the self-employed and the directly employed. But we need to do that in a way that allows people to plan ahead and ensures the total package of tax and benefits is fair to the self-employed.”