Updated from : The Straits Times, 28 June 2020
A new $1.36 billion fund has been set up to help construction companies, among the hardest hit by the Covid-19 pandemic, safely restart work.
The Construction Support Package, as it is called, will help co-fund some of the extra costs construction firms have to incur to comply with more stringent virus safety measures.
It will also help to relieve half of the non-manpower costs – capped at 1.8 per cent of the contract sum – construction firms in public sector projects will incur due to the slower pace of work during this period, said the Building and Construction Authority yesterday.
The Government will continue to bear the costs of Covid-19 testing for the sector until March 31.
The Construction Support Package is part of the Fortitude Budget, which is one of four Budgets totalling almost $100 billion in Covid-19 support measures passed in Parliament this year.
During a tour yesterday of the worksite of the future Circle Line’s Prince Edward station, Minister of Manpower Josephine Teo said that safety measures in the construction sector are “far more stringent” but necessary to protect the larger community. This means the pace of construction work would slow down. “We still want to have our MRT lines (and) our build-to-order flats,” she said, explaining the importance of helping construction firms.
Minister for Social and Family Development Desmond Lee, who was also at the event, said sweeping changes are confronting the construction sector – from testing and clearing workers of the virus, to accommodation, transport and zoning of worksites.
Following the restart of work, contractors are required to deploy safe management officers at worksites, with the Government co-funding 50 per cent of their salaries if they are Singapore citizens or permanent residents for six months from September.
Advance payment to firms working on public sector projects will be given until they have been granted permission to restart work, although this is subject to a cap of 5 per cent of the project’s awarded contract sum or $10 million, whichever is lower.
Mr Francis Koh, 58, group chief executive officer of construction firm Koh Brothers, said the fund was “timely” and will help reduce losses but will not cover all costs.
“Each bus used to ferry workers now has capacity reduced by 30 per cent,” he said. “We are also facing increased costs of up to 40 per cent for each month that the project is taking longer than expected to complete.”
About 80,000 of the 323,000 workers living in dormitories in Singapore have so far been cleared of the virus, although only about 17,000 can start work after fulfilling conditions including downloading the TraceTogether mobile app for contact tracing.
Dormitory operators must also have implemented safe living measures and arranged with employers such as construction firms to pick up and drop off workers at worksites at staggered timings, all of which constitute extra costs for companies that are not factored into their tender bids made before the pandemic.
Separately, foreign worker levy rebates of $90 per month will be given for each work permit holder from August this year to end-2021, with a possibility of extension till end-2022.
This falls under a separate $920 million fund that will benefit 15,000 companies in the construction, marine shipyard and process sectors, announced by the Ministry of Manpower and the Ministry of Trade and Industry yesterday.