KUALA LUMPUR: Works Minister Datuk Seri Alexander Nanta Linggi thinks it is still too early to estimate any increase in construction costs following the removal of diesel subsidies on June 10.
He said the government is currently studying the issue, and before contemplating or introducing new policies, careful consideration needs to be taken based on various aspects.
“One aspect includes the building materials cost index released by the Statistics Department, which tracks fluctuations in construction material costs nationwide,” the FMT portal quoted him.
Nanta added that discussions are ongoing with the relevant agencies to address and assess potential impacts on the construction industry.
He was responding to a supplementary question from Roslan Hashim (PN-Kulim-Bandar Baharu) on government initiatives to help contractors facing higher costs of machinery and materials during the recent Dewan Rakyat sitting.
Roslan said contractors who had secured projects before the diesel price increased by around 55 per cent were now facing increased construction costs ranging from 15 to 35 percent.
On another note, he said the subsidised diesel scheme introduced on Oct 19, 2021 was never extended to the construction industry.
“The purchase of diesel for construction purposes has traditionally been through commercial channels rather than the retail purchases eligible for subsidies before this diesel price adjustment.
“Existing contractors have factored in diesel prices, so there is a possibility that the construction industry will be affected by the adjustment,” he said.
