THE state government should allow its contractors to adjust their prices in view of the hike in the price of construction material.
Chong Chieng Jen (DAP-Padungan) said that in the last one year, prices of construction material had increased tremendously with steel prices increasing twofold.
“Even the prices of locally produced cement, sand, and gavels have increased while the industrial diesel prices have also doubled compared to a year ago.
“As a result, almost all contractors who have been awarded construction contracts six months or earlier find it impossible to continue with their contract work without making huge loses and many could not afford to continue,” he said during a press conference today.
Chong noted that to dealing with the problem, the Works Ministry on May 1 this year issued a directive allowing contractors undertaking federal projects to review their contract prices upwards to cope with the price increase of building material.
“Unfortunately, no such directive was issued at the state level so far. Though many Gabungan Parti Sarawak (GPS) elected representatives during their debate in the State Legislative Assembly (DUN) have urged the government to blacklist contractors (for delaying projects) and punish them, I do not agree with their stand.
“The sudden surge in the prices of construction material is something that is beyond the control of these contractors,” he said, adding that they had suffered for two years due to the COVID-19 pandemic, and since the state’s economy was still slow to recover, these contractors should be given a second chance.
Adding on, he warned that to blacklist the contractors at this time would have far-reaching adverse effects on the state’s economy as a whole, thus slowing down recovery.
“Therefore, I urge the state government to emulate the federal government’s policy and allow our contractors to review upwards their contract prices so that the projects may be completed and they in turn could contribute to our state’s economic recovery,” he said.
