The build contact was being worked on alongside the design work to maintain the overall schedule.

The flagship is due to cut metal by the end of 2022 and “that timeline has not been affected”, sources said.

A Minstry of Defence spokesman said: “The National Flagship will promote the UK’s economic prosperity by acting as an iconic diplomatic and trade platform, showcasing the very best in British engineering and green maritime technologies all around the world.

“The accelerated procurement remains on track, with the design stage ongoing before cutting metal by the end of 2022, generating UK jobs, skills, and prosperity throughout our shipbuilding sector.”

The Telegraph has campaigned for a replacement for HMY Britannia to project the UK’s soft power around the world since 2016 when Britons voted to leave the European Union.

In July last year, Mr Wallace told the Telegraph’s Chopper’s Politics podcast that he wanted the flagship to be like a floating embassy, a place where world leaders can convene to agree trade deals that can showcase the best of British engineering, powered by the most up to date “green technology”.

He said: “There are lots of ways to get more out of the ship, more innovative. There are examples of ships around here that mix basically sail and engine.”

Mr Wallace was dismissive of critics who have said that £250 million can be better spent on other public services like the National Health Service, saying the cost is “less than 0.01 percent of the defence budget” and “we can re-profile other programmes”.