On the morning of January 29, the Ministry of Construction coordinated with the Ministry of Transport to organize an online conference to implement the Prime Minister's Official Dispatch No. 02, focusing on removing difficulties and obstacles related to construction norms and unit prices; exploiting and supplying construction materials for key and important national transport projects and works.
According to Deputy Minister of Construction Bui Hong Minh, in recent years, the implementation of investment in key construction projects such as the North-South expressway system, the East-West expressway, belt roads, the national railway system upgrade project, metro projects, seaports, and airports has been developed synchronously.
However, the leader of the Ministry of Construction also said that in reality, project management still encounters difficulties related to the management of construction investment costs, management of norms, especially the price of construction materials at the mine assigned to contractors for exploitation according to special mechanisms.
From the implementation reality of the transport sector, Deputy Minister of Transport Le Anh Tuan clearly stated that even projects that apply some special mechanisms still have 3 main problems.
Firstly, the current management of construction investment costs includes: construction norms and construction prices, such as surveying, re-examining the loss and content of norms during the construction process; the development and promulgation of specific construction norms of the industry and locality; the development and promulgation of material and labor prices...
Second, the determination of material prices at common construction material mines (soil, stone, sand) is subject to a special mechanism for mineral exploitation.
Third is price adjustment and payment, settlement of construction contracts.
Deputy Minister of Transport Le Anh Tuan pointed out 3 main problems in unit price standards.
The more the contractor works, the more he loses.
Sharing at the conference, Mr. Do Dinh Phan, Deputy Director of the Hanoi Traffic Construction Investment Project Management Board, said that with project management and investment consulting costs, Circular 12/2021 issued by the Ministry of Construction only has norms for projects from 30,000 billion VND or less, but has no guidance for projects over 30,000 billion VND.
Specifically, the Component 3 project of the Ring Road 4 project - Hanoi Capital Region has a total investment of more than 56,000 billion VND. If applying the cost norms as for projects of 30,000 billion VND or less, the project management cost is estimated at only about 70 billion VND. This cost level is expected to be covered for only 2 years, while the project implementation time is longer.
Mr. Phan suggested that for large traffic projects built in the inner city of Hanoi and Ho Chi Minh City, with the characteristics of both construction and traffic organization, project management costs need to be studied and built in a specific direction.
From the experience of constructing many expressway projects, the representative of Trung Chinh Company pointed out some shortcomings in the regulations on standards such as labor costs; the standard costs applied to equipment such as cranes and barges are very small compared to the actual equipment today, it is necessary to adjust the K coefficient of machines in the construction of large bridges...
Mr. Nguyen Tuan Anh, Deputy General Director of Truong Son Construction Company, said that he has repeatedly expressed his opinion on the inadequacies of unit price standards, even petitioning the Government about the situation where contractors "work harder and harder to lose money".
"Construction standards such as crushed stone and cement mixes are very painful, greatly affecting the efficiency of contractors. Besides, determining the labor price frame according to Circular 12/2021 of the Ministry of Construction compared to the present is very low, not keeping up with market unit prices," said Mr. Tuan Anh.
In particular, the material prices announced in localities have "made contractors dizzy". In the second quarter of 2022 alone, the purchase price of sand for the project of this contractor was 66% higher than the announced local price. The reason, according to Mr. Tuan Anh, is that the announcement of local prices was not timely, not close to reality or the mine owner had increased the price. This led to the package price of more than 600 billion VND, but it exceeded by more than 60 billion VND.
In addition, the Government has issued a special resolution on construction materials, granting mining rights directly to construction contractors. However, the reality is still complicated, because mining rights and procedures still have to follow step-by-step regulations as before. Localities have different regulations in a "hundred flowers bloom" style, making it very difficult for contractors. Negotiating with people is very difficult because people demand compensation prices according to the market...
"At a project in the Central region, we completed licensing procedures from April 2023, but by the time the first stone was produced, it took 9 months, and there was not much time left for exploitation," said Mr. Tuan Anh.
Representatives of contractors, project management boards and localities all complained about the difficulty in applying current standard unit prices.
This contractor also recommended that the ministries promptly re-establish the system of norms, adjust inappropriate norms, adjust salary costs, machine K prices, pre-calculated taxable income, etc. In addition, it is necessary to coordinate with the locality to plan which mines to grant to the project from the beginning, shortening the time for procedures; if the bid is won and then implemented, the time will be very long.
"It is necessary to clearly regulate the issue of contractors negotiating prices with people, to facilitate post-audit work. Because all expressway projects are post-audited, it is very risky for contractors," said the leader of Truong Son Company.
"The Ministry is very concerned about unit price standards"
Concluding the conference, the Deputy Minister of Construction said that "the ministry is very concerned" with the regulation on unit price standards, and has approached both methods according to unit price standards (China, Japan) and according to synthetic prices (Europe, America). The ministry will study new methods, taking digitalization as the basis.
According to Mr. Minh, the Ministry of Construction has previously advised the Government to use the BIM coefficient; for example, special type A state projects must apply BIM in all stages, helping state management agencies form a comprehensive unit price.
"Without promoting BIM, there will be no big data or sample management system. The Ministry of Construction is continuing to perfect both directions. In particular, the new bidding price is the official price, approaching the market," Deputy Minister Minh emphasized.
He also said that every method has its advantages and disadvantages, so the standard coefficients always have shortcomings. The Ministry of Construction and the Ministry of Transport will establish an inter-ministerial working group to clearly review which standards are lacking and need to be supplemented, in an objective and transparent spirit.
Regarding norms, according to Mr. Minh, there are currently some norms that are not suitable, lacking, and have not been updated with new technologies. The two ministries will implement the issuance of new norms as well as review old norms.
However, public investment management projects must strictly control costs. For example, regarding labor costs, localities are currently authorized to announce locally according to methods announced by the Ministry of Construction.
The Ministry has assigned the Institute of Construction Economics to review and adjust the labor price framework or remove it if input factors change. Accordingly, review the different labor costs in different localities; Hanoi and Ho Chi Minh City must be different from other localities...
"Construction material prices must be announced promptly, correctly, and close to market prices. The working group will review material prices at the mine, how specific costs differ from normal costs, and if necessary, the Ministry of Construction will adjust the method. Regarding specific announced prices, these can only be determined by contractors, investors, and localities," the Deputy Minister of Construction emphasized, and asked localities to reflect on any remaining problems in the ministry's guidance process.
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