KUCHING: The Sarawak Master Builders Federation (SMBF) has urged the Federal Government to extend targeted diesel subsidy support to construction logistics vehicles, warning that the current subsidy rationalisation is driving up project costs across Sarawak.
Its president, James Ha, said suppliers have begun imposing fuel surcharges on ready-mixed concrete, haulage and construction materials following the diesel subsidy rationalisation, which would inevitably increase the cost of building homes, schools, hospitals and other public infrastructure.
While acknowledging the government’s efforts to rationalise diesel subsidies and reduce leakages, he said the current implementation has placed immediate cost pressure on the state’s construction industry.
“Many contractors are particularly affected because recently awarded projects were tendered based on fixed contract rates, while material and transportation costs continue to increase,” he said in a statement today.
Ha said contractors are now being forced to absorb the additional costs in the absence of a clear and timely Variation of Price (VOP) mechanism, placing significant financial strain on ongoing projects.
He noted that Sarawak’s unique geographical conditions make diesel-powered transport indispensable to the construction sector.
“Diesel-powered lorries transporting sand, quarry products, ready-mixed concrete and other building materials are essential to keep projects moving across Sarawak,” he said.
He added that diesel-powered four-wheel-drive vehicles are equally critical for engineers, supervisors and site personnel travelling to construction sites, especially in rural and interior areas.
SMBF also called on the Federal Government to extend targeted assistance under the Subsidised Diesel Control System (SKDS) programme to construction logistics vehicles, including mixer trucks, quarry and sand lorries, material transport vehicles, as well as diesel-powered four-wheel-drive vehicles used for genuine construction site operations.
“Such a targeted approach would help stabilise construction costs, ensure the continued delivery of critical infrastructure projects, and protect both the construction industry and consumers from further inflationary pressure,” he said.
