BINTANGOR: A cost-sharing approach between the government, contractors and suppliers has been proposed as a practical measure to ensure the continuity of government projects amid rising costs driven by higher diesel prices.
Tanjong Manis MP Datuk Yusuf Abd Wahab said the percentage-based sharing mechanism is fairer as the burden of increased costs should not be borne solely by one party.
According to him, the approach would help stabilise contractors’ financial positions while reducing the risk of delays or abandoned projects.
“The government will do its best to assist contractors involved in government projects so that implementation is not disrupted by rising fuel prices,” he was quoted as saying in an UKAS report.
Yusuf, who is also the Construction Industry Development Board (CIDB) chairman, explained that the surge in global oil prices, driven by tensions in West Asia, has directly impacted diesel prices in the open market.
He said the increase in fuel costs has also driven up logistics expenses, triggering a chain effect on the prices of construction materials and overall project costs.
The situation, he added, has placed significant pressure on contractors, particularly those involved in government projects, as they are forced to absorb unexpected additional costs.
In this regard, he stressed the importance of ensuring infrastructure projects proceed smoothly without disruption due to financial constraints.
At the same time, he advised contractors against taking drastic measures such as reducing their workforce to cope with rising operating costs.
