CIDB says govt projects should provide for price variation

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A price increase simulation has shown a 7% rise in construction costs and 15% to 25% drop in profit margin.KUALA LUMPUR: The Construction Industry Development Board is recommending that government projects contain a price variation clause, which would ease the burden of contractors affected by inflation of building material prices.CIDB chief executive Ahmad ‘Asri Abdul Hamid, said including the clause during the movement control order (MCO) period would also guarantee projects are finished on time.“Price increases in building material will undeniably impact the cash flow of those in the supply chain and is expected to be passed on to the end user. This issue will definitely trigger various effects for everyone in the industry during this challenging period due to the pandemic,” he said in a statement today.CIDB revealed that an increase in prices would affect small and big con…