KUALA LUMPUR: Allocations for contractors to build affordable government housing programmes have been increased from RM55,000 to RM68,000 per unit, says Datuk Seri Ismail Sabri Yaakob.
He said that this is in line with the increasing cost of material and to provide a better profit margin for contractors.
The Prime Minister said the Cabinet had agreed to the decision for houses under the hardcore poor housing programme (PPRT) under the Rural Development Ministry, Housing and Local Government Ministry and the Kuala Lumpur City Hall (DBKL).
"This is to ensure that there is some profit margin for contractors involved to build affordable homes," he said in his speech at the 43rd annual general meeting of the Malaysia Malay Contractors Association (PKMM) convention on Tuesday (Oct 18).
According to the Prime Minister, contractors have raised concerns that they could not afford to build the houses at the old price.
"Many of them had returned the projects as they could not do it at that price. The price is too low and they could not make much of a profit," he added.
However, he also thanked bumiputra contractors that had completed the affordable government housing projects even with such a small profit margin.
Earlier, PPKM president Datuk Mohamed Fadzill Hassan had raised the issue in his speech and requested whether contractors that had completed the projects can be paid using the new price.