KUALA LUMPUR: Construction industry players have urged the government to roll out immediate assistance for contractors during the total lockdown which takes effect tomorrow (June 1).
Master Builders Association Malaysia (MBAM), in a statement today said, many contractors might fold as they cannot absorb the additional costs incurred if the total lockdown is prolonged for six weeks or potentially longer.
The industry, it said, will face a shortage of contractors that will lead to overall price escalation in short to medium term.
"We thank the government for allowing critical maintenance and repair works and critical construction works for major public infrastructure to operate during the total lockdown, starting tomorrow.
"However, many contractors are still in dire state as we have been suffering due to various additional costs arising from the Covid-19 pandemic, including but not limited to high steel bar and copper prices, insufficient workers, high compliance cost to the Workers' Minimum Standards of Housing and Amenities Act 1990, high compliance cost to Covid-19 Standard Operating Procedures (SOP) and swab tests costs.
"All these costs were not factored in at the start of project and with no provision in the Covid-19 Bill to protect the contractors, we have been biting the bullet to ensure projects can still be completed on time and providing job security to the many workers in the industry," it said.
MBAM, therefore, urged the government to roll out additional stimulus packages to cushion the economic impact for the people and the industry.
Among its suggestions include automatic moratorium extension for people and businesses (starting June 1), financial assistance and low interest financing rates to provide financial aid to businesses as well as tax breaks and utility subsidies for businesses throughout the total lockdown period.
MBAM also proposed for the Wage Subsidy Programme to be reinstated for all employees with salaries of RM 4,000 and below.
The government, it said, should also expedite payments for government projects at all tiers, especially for May 2021, to ease cash flow of the construction industry.
MBAM also requested that levy for foreign workers renewing their work permits be waived and that permit approvals be extended for those stuck at their home country during thr lockdown and for those who will be overstaying due to the movement restrictions.
"It is hoped that the Immigration Department can consider the waiver of fees for special passes due to overstaying during the lockdown period.
"The Temporary Measures for Reducing the Impact of Coronavirus Disease 2019 (Covid-19) Act 2020 must also be extended.
"The Covid-19 Bill must also protect contractors and expressly state the provision for extension of time (EOT) and cost sharing between contracting parties.
"Contractors should also be allowed to ask for compensation from project owners," it said.
Additionally, MBAM suggested the government to implement free mass testing nationwide to trace and break the Covid-19 infection chain, besides using private hospitals and clinics to expedite the vaccination drive.
It also appealed for the government to defer and not introduce any other new policies during this trying period which will further increase the cost of doing business.