Build­ing con­trac­tors have their say

The Myanmar Times - - Front Page - MYAT NYEIN AYE my­at­nyeinaye@mm­times.com

A new in­dus­try group for con­trac­tors has come to­gether with a long list of griev­ances for Yan­gon City Devel­op­ment Com­mit­tee.

OVER 500 of Yan­gon’s li­censed build­ing con­trac­tors met last week to de­bate form­ing an in­dus­try as­so­ci­a­tion, which will have a long list of pol­icy com­plaints to take to Yan­gon City Devel­op­ment Com­mit­tee.

The city’s con­trac­tors are band­ing to­gether partly in an­tic­i­pa­tion of new YCDC reg­u­la­tions, and be­lieve an in­dus­try as­so­ci­a­tion will make it eas­ier for them to li­aise with the gov­ern­ment.

YCDC fin­ished amend­ing build­ing­per­mit reg­u­la­tions last month, and the as­so­ci­a­tion can “stand up for con­trac­tors” if there are prob­lems as a re­sult of th­ese new rules be­ing en­forced, said U Lar Sal, spokesper­son for the as­so­ci­a­tion.

But at a meet­ing of over 500 po­ten­tial as­so­ci­a­tion mem­bers on Au­gust 31 it be­came clear that con­trac­tors al­ready have a num­ber of con­cerns with ex­ist­ing YCDC poli­cies.

The big­gest griev­ance was against a K50 mil­lion de­posit that li­censed con­trac­tors must make with YCDC in or­der to op­er­ate. Some con­trac­tors re­mem­ber a time – a lit­tle over 10 years ago – when the de­posit was just K2 mil­lion and it was placed in a bank ac­count that earned in­ter­est, said U Zaw Win, act­ing chair of the as­so­ci­a­tion.

The size of the de­posit has crept up over the years, and YCDC now sim­ply holds the de­posit with­out pay­ing in­ter­est, con­trac­tors said. This is par­tic­u­larly prob­lem­atic for firms be­cause in­fla­tion in Myan­mar is in the dou­ble dig­its, ac­cord­ing to re­cently pub­lished data from the Central Sta­tis­ti­cal Or­gan­i­sa­tion.

The CSO monthly in­fla­tion fig­ure for July was 10.59pc.

“We’re not sure where they put the de­posit money,” said U Kyaw Htay Thein of Kyaw Con­struc­tion Com­pany at the meet­ing. “The old Yan­gon gov­ern­ment kept the de­posits in banks and we got in­ter­est now we don’t.”

Nay Win, deputy head of YCDC’s De­part­ment of En­gi­neer­ing (Build­ing), said that the rules on pay­ing in­ter­est on the de­posit had changed 13 years ago, and YCDC now holds the de­posit in a gov­ern­ment fund.

Con­trac­tor U Chit Swe of Nay Zaw La Con­struc­tion Com­pany added that in ad­di­tion the de­posit, firms also had to pay an an­nual fee of K500,000 to YCDC and a K5 mil­lion per­mit de­posit for each project.

That de­posit is re­turned once a com­pleted project re­ceives a build­ing com­ple­tion cer­tifi­cate, but firms some­times en­counter dif­fi­cul­ties get­ting the money back quickly, he said.

U Chit Swe had to wait around 2 months for his K5 mil­lion de­posit af­ter fin­ish­ing a project ear­lier this year, he said.

“We need to pay a lot of money for a build­ing [project], our de­posit money is tied up and there’s no in­ter­est,” he said. “So for us th­ese are big prob­lems to dis­cuss with YCDC af­ter we found the as­so­ci­a­tion.”

Another is­sue that came up at the meet­ing is a new re­quire­ment stat­ing con­trac­tors must se­cure agree­ment from 10 neigh­bour­ing houses or apart­ments – up from only two pre­vi­ously – be­fore start­ing a con­struc­tion site, said U Kyaw Htay Thein.

This also raises costs, be­cause house­holds de­mand pay­ment in or­der to give their con­sent.

“Con­trac­tors shouldn’t have to pay, but if we don’t then peo­ple don’t sign the agree­ment let­ter, and with­out the agree­ment let­ter YCDC doesn’t given the per­mit,” he said.

U Nay Win said that res­i­dents liv­ing near con­struc­tion sites of­ten com­plain about dis­tur­bance, which had prompted YCDC to re­quire that con­trac­tors get res­i­dents’ agree­ment. When con­trac­tors face is­sues se­cur­ing this con­sent, in­clud­ing be­ing asked for cash pay­ment, YCDC can be flex­i­ble, he added.

“It doesn’t al­ways have to be agree­ment from 10 apart­ments,” he said. “Some­times we’ll re­duce the num­ber.”

But many at­ten­dees were up­set, not only at the sub­stance of the new YCDC rules and reg­u­la­tions but also be­cause they are changed so fre­quently.

“They [YCDC] should hold dis­cus­sions with con­trac­tors be­fore amend­ing rules for build­ing per­mits be­cause they some­times make rules that are hard to fol­low,” said U Chit Swe.

A re­cent ad­di­tion to YCDC’s build­ing per­mit rules is that the bot­tom floor of build­ings eight storeys or higher must be set aside for park­ing. But the low­est floor is also the most lu­cra­tive for de­vel­op­ers, and the new park­ing reg­u­la­tion will re­duce prof­its for the con­struc­tion in­dus­try, he said.

YCDC re­voked sev­eral con­trac­tor li­cences last year – the first time it had ever done so in re­sponse to firms break­ing YCDC rules.

Spokesper­son U Lar Sal said the li­censed con­trac­tor as­so­ci­a­tion will be called the YCDC LC As­so­ci­a­tion, but it has yet to ap­ply for reg­is­tra­tion as an of­fi­cial in­dus­try body with the Yan­gon Re­gion gov­ern­ment.

Photo: Aung Myin Ye Zaw

Work­ers clean up at a con­struc­tion site in Yan­gon.

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