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MANAGING CONSTRUCTION
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nikzafri



Joined: 10 Jan 2008
Posts: 119

PostPosted: Sat Jan 12, 2008 12:02 pm    Post subject: MANAGING CONSTRUCTION Reply with quote

The Star Global Malaysian Forum

The Star Business - Wednesday November 7, 2007

Construction assets draw foreign interest - Infrastructure and development projects a boon to sector

PETALING JAYA: Local construction assets seem to be attracting the interest of foreign investors of late.

Last month, Putrajaya Perdana Bhd saw the entry of a new controlling shareholder, Swan Symphony Sdn Bhd, which bought over Eastern & Oriental Bhd��s stake in the former. Swan Symphony is jointly owned by Abu Dhabi-Kuwait-Malaysia Investment Corp (ADKM) and Autron Investment. With the support of the new shareholders, Putrajaya Perdana is anticipated to expand its presence to the Middle East.

Meanwhile, PJBumi Bhd told Bursa Malaysia on Monday that its substantial shareholder, PJS Industries Sdn Bhd, planned to sell a 10.2% stake to Al-Saudia for RM3.1mil. This was on top of the 25% that PJS disposed of to Metro Utilities Sdn Bhd in September. PJBumi, which is trying to return to profitability, is involved in the design, trading, installation and maintenance of fibre-reinforced plastic, reinforced concrete sewage treatment plants and underground petrol cum storage tanks.


It also manages wastewater treatment, solid waste and garbage collection.

The Government��s efforts to improve the quality of water in the country by rolling out various projects look set to benefit PJBumi. Another company that is going to see a new shareholder is low-profile water player Loh & Loh Corp Bhd. The shares, which are usually thinly traded, seemed to have sprung to life, having appreciated more than 30% over the one week period. The counter was last traded at RM4.12 before being suspended in afternoon trade yesterday.

Loh & Loh told the exchange that its substantial shareholder, Vital Achievement Sdn Bhd, intended to dispose of its shares. An analyst at AmResearch said Loh & Loh was well known as a dam builder in the water sector, having completed several jobs as a sub-contractor for Gamuda Bhd. The company also has experience in bulk earthworks and rail track construction, having built bridges for the Ipoh-Rawang double-track project.

Aseambankers in a report said the domestic construction scene could be seeing another boom, given that at least RM165bil worth of infrastructure and development projects identified by the Government and the private sector were likely to kick off by the turn of the decade. Government spending should pick up since it had to date only spent 25.4% of the RM200bil in development allocation under the Ninth Malaysia Plan, it said.

��We foresee high impact and chunkier projects in the rail, water, and oil and gas sectors, and the government��s regional development efforts, to be the key drivers,�� the brokerage added.

---------------------------------

The way I see it this is a good tonic for the local construction industry. Of course, this has something to do with IDR, ECER, NCER just being launched, It is also related to the relatively competitive project management costs that Malaysia has to offer. With various crisis happening almost everywhere in the world, Malaysia is drawing construction FDI interests and possibly JV, smart partnership, strategic alliance and even merging possibilities would be happening. Despite my worries about uncontrolled construction materials cost; come to think of it; the FDI may help the local construction firms in terms of long term financing - thus may help in the long run to ensure the construction industry sustains.

There are somehow other concerns:

a. Shareholding in terms of JV or smart partnerships? Will our construction firms be too strict and not embarking on a 'win-win' situation?

b. Is the local construction firms ready with

i) all the necessary expertise,

ii) possible mixed work cultures influence,

iii) more than enough 'quality' services to provide - in terms of system/process/workmanship, the necessary infrastructures/machinery/ICT capabilities, corporate governance good practices etc.?

c) Will (more and more) our financial institutions be willing to cooperate - help out the local construction industry or just hope that the foreign construction firms come out with majority of financial backups and in the end, we promise them a big amount of concessions, contra with finished properties, or share the future profit reaped from the finished projects? etc? in order to cover the financial backups that are rendered by the foreign construction firms? (via foreign financial institutions e.g. soft loan or long terms bonds or any other financial instruments)

Thus, while we are happy almost seeing big money coming in, I think the local construction firms should also think of what I've said herein. Based on history (and my experience working with the local JV partners) many mega projects management appear to love doing things 'last minute' - I hope this is not the example we're going to show them.

Let's welcome construction FDI with wide hands..WELCOME..but please...let's local construction firms be ready to show a very professional ethics in terms of our personal traits, business, technical, system etc.
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nikzafri



Joined: 10 Jan 2008
Posts: 119

PostPosted: Sat Jan 12, 2008 12:03 pm    Post subject: Reply with quote

Corpbabes further posted :

First of all, thanks ahvincent and nik zafri for explaining patiently to the issue that i have put forth. Dont worry, I understand the ethical issues that arise, but theoretically, i still have to see things from every issue so that i can write a good research on it.

After taking everything both ahvincent and nik said, correct me if im wrong, but does it mean that during the warranty period, in the event of personal injury and death, the owner wont be fully liable, but he can bring in, say the developer etc as contributory negligent? but after the warranty period, it would be difficult to make the owner liable for any defects that comes up?

Further, on the same thread, can we then exclude design liability? It may take years to discover the defects, but say, from the owner's point of view, can we exclude liability still by contract and also contractually exclude tort after the warranty period is over?

re there any statutory prescriptions in relation to warranty periods for construction works that i spoke about in my first post, nik, you said that would depend on which stage that i'm referring to - pre-construction, during construction and post construction? May i know if there is any statutory prescriptions for all stages of construction?

Many thanks in advance.

----------------
nikzafri's reponse

Let me try : (I�m trying only maaah - so corpbabes � take the following as my personal views�as I may be right and I may be wrong..all is based on experience - and you must excuse me..some of your questions may not be answered - not that I don't know - and I'm sorry)

1. �during the warranty period, in the event of personal injury and death, the owner won�t be fully liable, but he can bring in, say the developer etc as contributory negligent? but after the warranty period, it would be difficult to make the owner liable for any defects that comes up?�

2. �Further, on the same thread, can we then exclude design liability? It may take years to discover the defects, but say, from the owner's point of view, can we exclude liability still by contract and also contractually exclude tort after the warranty period is over?�

No. 1 - I�m sure you remember the Highland Towers Case? It was WAY after the warranty period itself BUT the designer was still being summoned by court.

http://www.lawyerment.com.my/library/doc/laws/casecode/jdgm/11082000-01-1.shtml

Within this civil suit, you can clearly see the consultant (design) consortium (defendants) was still being called to defend itself (not necessarily being charged if proven that the onus of liability is not due to his design)

So, when a case happen, it will relate to one process to another and will start from the Design/Planning stage itself.

Of course, in the process, if the designer will argue to prove that it may or may have nothing to do with his/her design - with sufficient evidence substantiating his/her testimony � if the court is OK with it, then definitely the developer would be the NEXT target (contract may be referred to)

In this stage, probably the answer/onus may lie on the developer or the contractor. Certain things like �approving and/or making unlawful (design) deviation� not according to the �approved design brief/specifications/drawings/plans� or �using low-quality materials� etc. etc. may come into the picture.

It depends really on how the court handle the case judging by evidence submitted. You'll be surprised that the outcome may be a LOT different that what I've said here.

But, I personally think, despite that the owner said that he can bring the developer according to the contractual obligation; yet; by right, being the owner, he should know what�s happening right from the start to the end of the project .

Back to the �ugly reality� the owner would usually �wash his hands� and PUT other parties responsible for the �failure� just because he has all the money but he doesn�t have the experience!

But he should remember that he�s the one who was responsible for appointing the developers (if not himself IS the developer) plus agreeing to the appointment of design consultants (in turnkey/design and build environment). So it would be more effective if the owner IS a technically competent person by qualifications/and/or experience.

When it comes to court�s judgement, it�s very complex to determine �who is wrong for what� as the process of the law is a bit different�too many factors to be considered. Sometimes, the law doesn�t state clearly or citing the examples but there are supporting elements that can be deemed as legal � for example, standards and codes of practice regarding design.

In another situation, the right people you should also be asking would the insurance company on construction insurance � I do not know much about this one but I do know one thing, construction insurance can sometime NOT cover a �prototype technology/design� without any technical documentation, codes of practice/standard, method statements, research etc. to prove that the design is SAFE even after the warranty period. So try the insurance company�

Apart from Insurance, you should also try to pose the question to these �guys� who I considered �my e-associates� as well :

http://pmimy.org/modules/newbb/viewtopic.php?topic_id=90&forum=2

Nevertheless, You should take this into account as well -.every warranty period has an �expiry date�. In some countries, 20 years is sometimes considered �dilapidated�, �unsafe� and possibly �condemned�. Notice is given and legal action can be taken�

No. 2 � It really depends on the case we�re talking about, how severe the case would be. Usually design liability cannot be excluded even after the warranty period typically �in the event of �total design or major design failure� (I�m unsure of personal injury and death � but in Highland Towers � the main focus was the design failure as it involved �total structure collapse� as the 'cause' � then, followed by 'personal injury and death' as the effect - even the effect was associated to legal action taken by immediate family of the deceased..if not, probably there would be no case)

Of course, I�m not referring in view to discover defects related to design after many years of project completion, it wouldn�t be practical (we can�t dismantle or hack what is already being installed and used)

What I�m referring to is actually the documentation/data/forms/supervision during all stages of construction including design data/calculation, design amendment procedures, inspection and testing ,construction methodology/method statements etc. as this should be �archived� safely during the post-construction stage (final accounts) � usually kept by all parties � the client, the developer cum the consultants + the contractor. (again, some data could already be destroyed due to record retention policy...hmmm difficult isn't it?)

Thus, from these documentation/data, we can �go back in time�, detect any possible deficiency/how the corrective/preventive actions being taken (right or wrong way)

On the question of whether there is such prescription of statutory, I think my answer has been given in �BOLD� abovementioned. That�s why we have contracts, codes of practice, design coordination, method statements, inspection and test plans etc. � these documentation serve as the professional justifications to the law itself and to assist implementation of the law. Again I would reiterate - in any case..the law prevails.

(Which law? you can easily buy them - 3 titles recommended - Contract Law, Uniformity Building ByLaw and the Engineer's Act)

And YES, (again this is my personal view) it SHOULD be covering ALL STAGES of construction as design is not only during pre-construction � despite being approved � they are still subject to amendment and revision � why? Because of the application based on the actual site condition � there will still be deviations even during and after the construction. (But I�m not implying that the law mention all these very clearly) � Contracts are originally about �proclamation of I trust you and vice versa� and they should be �referred� to the law.

Here�s another unique case you should be looking into :

http://www.contractjournal.com/Articles/2007/01/31/53440/questions-of-law-and-design-liability.html

But alas, there are too many arguments on the subject that you�ve asked. I�m not surprised if some quarters may argue my opinion..so regard what I�ve said here as �personal views� and not representing anyone or any party.
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nikzafri



Joined: 10 Jan 2008
Posts: 119

PostPosted: Sat Jan 12, 2008 12:05 pm    Post subject: Reply with quote

The Star Global Malaysian Forum - 24 October, 2007

corpbabes wrote:
Greetings! I stumbled across this website and thought it's really fantastic that people can discuss and get information here. I'm a newbie and I'm just wondering if anyone can help me.

My question is : is there any statutory prescriptions in relation to warranty periods for construction works buildings, designs etc for theme park related works.

Also what if personal injury and death, can warranty period and exclusion of liability help reduce liability ?

I would be glad if someone can explain these issues to me.

Thank you in anticipation.

------------------------------------
Ahvincent's Response

The statutory limit is normally six years. However, it can sometimes be extended to 12 years.

In the construction business some defects are latent i.e. it cannot be readily identified by a competent engineer for example concrete cancer which can take years to become evident.

In such cases the six years may start from the date that circumstances that could lead to a claim was first identified.

Exclusions can sometimes help but remember you cannot contract out of the law. You may exclude certain things but you definitely cannot exclude death or injury due to you negligence, error or omission.

In simple words you can have a sign on the front door to say "Enter at your own risk - no liability accepted." But if I was killed because you did not install the sign properly and it fell down and bang me on the head, you will be liable for damages. Or if your roller coaster ride fell off it's tracks due to poor maintenance or neglect than you can be sued for damages under the law of tort.

But having say all that - Yes, a limitation clause is good to have. It is better than nothing and gives your lawyers something to work with in the event of a claim.

However, the difficult thing in design and construction is "how to get the other party to agree and sign the contract that contains clauses that potentially decreases your liability. Unless that other fellow's lawyer cannot read.
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Nik Zafri's Response

corpbabes wrote:
Greetings! I stumbled across this website and thought it's really fantastic that people can discuss and get information here. I'm a newbie and I'm just wondering if anyone can help me.


Welcome corpbabes...that is why GMN is my first choice!

corpbabes wrote:

My question is : is there any statutory prescriptions in relation to warranty periods for construction works buildings, designs etc .


Depending on which stage that you're referring to - pre-construction, during construction and post construction? You see, different countries may adopt different practices, terminologies and timeframe. (which will affect the contract)

If you care to delve further in this very same topic, you will see that we've been discussing 'heavily' about Defect Liability Period, Warranty Period, Developer's Warranty etc. Try to have a look, probably it would help you and us further to understand the issue. (I'm sure you've heard the Govt is planning to revise and standardize these practices - but I'm unsure when)

corpbabes wrote:

for theme park related works


Or perhaps you may be referring to 'during the theme park already in operation - if so, which target group? 'the theme park workers?'? The theme park visitors? The 'entertainment machines'? (roller coaster, merry-go-round etc.)

corpbabes wrote:

Also what if personal injury and death, can warranty period and exclusion of liability help reduce liability ?


Again, depending on which stage...and as ahvincent said - something like- this case should be mentioned in the contract to avoid future ambiguity and 'conflict'.

corpbabes wrote:

I would be glad if someone can explain these issues to me.

Thank you in anticipation.


Don't worry, GMN has a handful of helpful hands (3H)...ahvincent is definitely one of them...
-------------------------------
Response from corpbabes - 26/10/2007

Hello again!

Thanks so much for such prompt reply! Really appreciate it. I know my questions were not really specific and vague, hence Im trying to get more information regarding that before enquiring further.

Sorry for being so ignorant, coz Im really new in this field,Im just a pupil doing a research in this area. So forgive me if I sound so blur!

Im just wondering what happens if the defects occur after the warranty period, who will be liable and is there any legislations regarding this? As for the owner of the building for example, is his liability reduced if anything happens after the warranty period is over?

Also, can I give an anology: Say in a high rise building in genting, a disaster happen due to a design defect ; Contractually we exclude design defects and say construction defects, in death or personal injury, therefore can we say that in this scenario that the project owner be liable? What if we have designer and builder ... To what extent can we pass the buck to them?

Thanks in advance for all the assistance
-----------------------------------
ahvincent wrote:
Your question is many questions in one. Without being specific it is very difficult to answer.

Firstly, if you identify a defect after the defects liability period then you don't stand much of a chance of a successful claim.

If I bought an apartment from you (the owner) and I identify a defect within the warranty period, of course I will sue you. The contract of sale is between me and you. It has nothing to do with the builder who may have designed and constructed the apartments.

I, the buyer do not have a contract with the builder, the owner does. The builder does not owe me a duty. I did not hire him and neither did I pay him, so how can I hold him responsible. I can only sue the owner who sold me the faulty apartment.

However, the owner may join the builder as a co-defendent on the basis that as a result of his (the builder's) negligence he is now being sued and the builder should be held responsible.

I guess one of your questions is "the owner has stated in the contract that he is not responsible for design and construction faults" thus trying to avoid any liability.

I am afraid that attempt will fail. I, as the buyer can expect that the apartment is "fit for it's intended purpose." So, regardless of what you the owner try to do you will still be liable. Remember what I said before "you cannot contract out of the law."

The law of tort will be on my side (the buyer). I have every right to enjoy my purchase. If you sold me an apartment and the roof falls down in 6 months and the walls start to crumble and the floor starts to sink, I will ask the court "what did you sell me?" I tell the court that you the owner sold me a faulty product and I want my money back !!!. You did not sell me an apartment that is fit for it's intended purpose i.e. as a place of residence.

I will strongly suggest that a good lawyer for the owner will not try to get out of it by simply denying liability because the case is so obvious. He, the owner can quickly run away, change his name and go into hiding or he will quickly join the designer and constructor as co-defendants and seek proportional liability.

Anyway, your questions sounds very unethical by trying to pass the buck. Forget it !!! No lawyer worth his salt will let you get away with putting such irresponsible "get-out of jail free" clauses.

The text books tell us that the law is fair. Therefore you can try to be smart and put in lots of sneaky clauses but since the law is potentially fair it will rule any unreasonable clauses to be null & void and find you liable.

There are plenty of fish in the sea. I always advise my clients if the other party wants everything in their favour - walk away from the deal. You don't want to do business with such unreasonable people. Unless of course he makes you an offer too good to refuse. But again - nobody gives away something for nothing.

----------------------------------------
Nik Zafri's response

Good one ahvincent!!

My turn :

corpbabes wrote:
Im just wondering what happens if the defects occur after the warranty period, who will be liable and is there any legislations regarding this? As for the owner of the building for example, is his liability reduced if anything happens after the warranty period is over?


That's why looking into SPA (sales and purchase agreement) is very important before signing them - (that goes to everyone..not only housebuyers but property buyers as well) we don't want to end up in sticky situations like this one. I BET no party (developers, builders, bankers, lawyers) would tell you of your RIGHTS (esp. implied ones) since their interest in ONLY to sell and attempted to their best 'intellectual' knowledge NOT to be accountable.

These parties make you look merely into the 'expressed' terms but somehow they failed or ignore/deny your rights to know the 'implied' ones.

One example - You may or may not know that even during DEFECT LIABILITY PERIOD (DFL), the purchaser/buyer has implied RIGHTS to know what's going on - otherwise, how would we know of the final quality? How 'd heck' CMGD or CF (they keep changing the terms - now they call it "Certificate of Fitness for Occupation (CFO) be issued on the first place and suddenly we buyers found out that we have been 'had' when 'leaks' are discovered in our so-called newly bought houses or buildings?

Here's another 'masterpiece' :

http://www.nst.com.my/Weekly/PropertyTimes/News/Viewpoint/20030305105233/Article/

The waiting game


Many house buyers complain of having to take over of vacant possession (VP) of their new houses when they are not ready for occupation.

One of the reasons for this is that prior to amendment, the Housing Developers Act allowed developers to hand over VP upon application for the Certificates of Fitness for Occupation (CF). Many developers exploited this tenet of the Act by rushing to hand over the properties the minute the architect declared �practical completion�.

Problems for buyers

The hand over of VP without a confirmed date for occupancy has created numerous problems for house buyers. First, the new owners would have to make all outstanding payments as stipulated in the Third Schedule of the Sale and Purchase Agreement (SPA) upon taking VP. Next, the 18-month defect liability period would start to run 14 days from the date of notification of the hand over of VP, and third, the buyers would have to take over the responsibility for the security of their properties.

This state of affairs is grossly unfair to buyers. Imagine not being able to stay in your property after you�ve made all the outstanding payments, including maintenance charges. And if you�re not able to stay in your house, how will you identify and rectify faults that may be caused by the developer? Supposing the CF is issued six months after you receive your keys; this means six months of the defect liability period would have been wasted. Another point is that if you cannot stay in your home, how can you prevent vandalism and theft of your fittings, short of hiring a security guard, which many cannot afford?

Besides these, the house Buyers Association has come across other complaints from buyers who have been shown CFs from other projects that have been presented as theirs or CFs with falsified endorsements! Some buyers have taken VP, only to find that the developers have financial difficulty in fulfilling their obligations to apply for the CF!

Developers� responsibility

The application for CF is governed by the Building By-laws Act. As the name implies, the CF is an official document issued by the local authority to acknowledge that a building is safe for occupation.

It is the responsibility of the developer through its appointed qualified professionals, chiefly the architect, to make the application according to the Building By-laws and other conditions imposed by the appropriate authorities.

When complaints surface, both developers and the appropriate authorities point fingers at each other. As explained by Ministry of Housing and Local Government legal adviser Shamsulbahri bin Ibrahim, and advocate and solicitor Toong Gek Fong, in an article on the Malaysian Law Journal website (http://www.mlj.com.my/free/index.asp): �The crux of the problems relating to delay in issuance of CFO could be because:

1. The developer�s application for CFO is incomplete or not in compliance with all the requirements necessary for the issuance of CFO, resulting in the application being rejected by the appropriate authority. For instance, some developers fail to submit the Form E together with copies of all letters of clearance or approval (surat sokongan) from the relevant technical agencies, which are required by the appropriate authority for issuance of CFO, or

2. The delay or inefficiency of the appropriate authority issuing the CFO.�
To exonerate the local authorities from blame, the Ministry of Housing has issued directives to the effect that:
� All applications for CF submitted by developer are to be checked and confirmed to be in compliance with all requirements for issuance of CF before such applications shall be accepted by the appropriate authority;
� Upon acceptance of the Form E, the appropriate authority is to issue its written confirmation that the Form E submitted by the developer has been duly checked and accepted by the appropriate authority;
� Once such applications have been duly checked and accepted by the appropriate authority, the CF shall be issued or deemed to be issued within 14 days from the date such applications are accepted by the appropriate authority; and
� The appropriate authority will submit a written report/explanation to the Housing Ministry in respect of such cases where the CF is not issued within 14 days from the date the relevant application is accepted by the appropriate authority and in any other cases of undue delay in the issuance of the CF by the appropriate authority.

By-law 25 of the Uniform Building By-Laws 1984 was amended to provide for the issuance of the CF by the appropriate authority within 14 days from the date of acceptance of Form E, failing which the CF shall be deemed to be issued to the owner of the building.

Under the amended Housing Development Act, developers� responsibility with regard to VP and the CF has been expanded to include the following:

1. Conditions for delivery of vacant possession
It must submit a supporting certificate signed by its architect certifying that the building has been duly constructed and completed in accordance with all relevant Acts, by-laws and regulations and that all conditions by the appropriate authority in respect of the CF have been duly complied with and a supporting letter of confirmation from the appropriate authority certifying that the Form E (the application form for CF) has been duly submitted by the developer and checked and accepted by the appropriate authority.

� Duties to the Controller of Housing:
It must inform the Controller of the handing over of VP to the buyers and submit a certified true copy of the architect�s completion certificate and that water and electricity supply are ready for connection. It must also inform the Controller if the appropriate authority has refused to accept the submission of any document relating to the issuance of the CF and submit the refusal letter from the appropriate authority.

With the amendments to the Housing Development Act and the Building By-laws, it would seem that when house buyers receive notice of hand over of VP, they can assume safely that the occupancy of the property can be confirmed within 28 days of the notice. If not, the hand over of vacant possession can be considered premature, and the house buyer has every right to challenge the notice and asked the developer to withdraw it.

With the amendments too, the HBA sees no cause for local authorities to issue temporary certificates of fitness as it is not to the house buyers� advantage to occupy a home based on such a certificate.

We hope the Ministry of Housing is confident enough to implement further amendments of the Act, such as imposing that the delivery of VP comes with the CF. It is only right that a buyer should be able to take vacant possession of a home that is certified fit for occupation.

The National House Buyers Association is a non-profit, non-governmental, non-political organisation manned by volunteers. Our website is www.hba.org.my. E mail: [email protected]

- Property Times 1st March 2003 issue -


Which also may shed the light on your next analogy

[quote="corpbabes]Also, can I give an anology: Say in a high rise building in genting, a disaster happen due to a design defect ; Contractually we exclude design defects and say construction defects, in death or personal injury, therefore can we say that in this scenario that the project owner be liable? What if we have designer and builder ... To what extent can we pass the buck to them?[/quote]

Perhaps I didn't understand the question. But somehow, I doubt that this clause (design defect) is excluded in the contract - again depending on which stage you're talking about but typically in the 'design and build' mode, it's very irregular if a contract exclude such clause cos' it is regulated in Uniformity Building By-Laws 1984 (+ The Engineers Act as well) Even if there is NO such clause, the law prevails over 'deficiency' of such clause in a contract.

Remember, when a contract doesn't favour the law (where the latter being the former's umbrella), then the law shall prevail - e.g. clause ambiguity, or 'something that should be included but excluded - yet the law states clearly that it should be included'

But alas, despite of my explanation here, you should know that ahvincent is talking about the 'ugly REALITY of the construction industry' (which I must admit..it's TRUE) and you should take his suggestions into account as well.

and corpbabes (what's your real name..or at least a short one) - don't have to apologise profusely or being humble, you should be proud to pose such difficult question amidst a topic that not many want to be participating
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nikzafri



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Posts: 119

PostPosted: Sat Jan 12, 2008 12:06 pm    Post subject: CONSTRUCTION BUSINESS PLAN FOR FUNDING - Nik Zafri Reply with quote

Posted on The Star Global Malaysians Forum: 08 October 2007 at 9:06pm

preferred anonymous by e-mail wrote:
Hi Nik, I saw your comments in Global Malaysians and got quite interested in them. I google and found your name in the internet which has led me to your website and how I got this e-mail address.

I am thinking of expanding my construction business and I thought of seeking funds from the financial institutions. I've done a business plan reflecting all the necessary items to qualify for financial assistance. Some of the important contents are (apart from the opening/executive summary & company background):

Construction Service & Product Description, Target Market & Analysis for both Product & Service, Competition, Marketing Strategy, Financial Projections - P & L, Cashflow & Balance Sheet.

Is there anything more I should add?


Dear Madam

At one glance, I think your business plan has all the necessary elements (in the context of business plan format). If I may say something - I noticed that you didn't really mention in what capacity your construction firm is in. Or what type of financial assistance you're looking for - Loans? Venture Capital? P.O Financing? Factoring?

This is the typical problem when it comes to e-mail query - a bit of limited space.

The reasons I asked:

a) since I saw the word "Product" (or for BOTH Product and Services - you are implying that you have two not one)....you see "Product" can mean many things when it comes to construction...it can mean that you are manufacturing and installing construction materials as well e.g. cement for concreting? Steel for reinforced concrete? (Which also serves to make you a supplier & sub-contractor for concreting works as well...)

b) The construction service is also not clear - Civil & Building Engineering? M & E?

All the two aforesaid examples are categorized within the trade "Construction".

So, I'm assuming you are in both sectors but I'm unsure of the weight between the two (which one your company focus on e.g. 60% - construction services and 40% Product/Construction Materials)

Based on my experience assisting construction companies doing business plan, if a company has something to do with construction materials manufacturing, then it should be a wise move to first separate the financial projections between the two before consolidating them both (or you can have both separated..that wouldn't be a problem).

In the Product Description - if your company is a specialized trade contractor i.e. Cement & Concreting, then you should be including the quality and safety of your products for construction application for various structures such as residential, commercial - hi/low rise building etc.

One of the most difficult part in the 'Target Market and Analysis' section, is finding the statistical figures (I sure hope you have included statistics as well) based on the different category of construction (let's say concreting) e.g. you should estimate the number of establishments in a particular geographical area vs no. of people being employed vs total annual sales.

You should also take into account, your current and past performances - say..a cut off period of 3 years (depending your financial projection) - meaning you will have to include audited accounts alongside with some accounting records for support. (e.g. how much sales you have made for your 'product' in the past 3 years. When you have these intact, you can make a better forecast for 3 years ahead based on the current trends.

Another part that is posing many problems to construction business plan is to include the business ratio (usually immediately after the financial projections) - this is about your industry profile statistics - comparison of industry standards and the key ratios for this business plan.

It's also good if you can include graphs for each projection - where applicable - besides than tabular explanation.

One important point to note, you must be able to convince the 'financiers' that your company and your project venture have the 'viability' and can 'sustain'/'survive' in the market for quite sometime. In order to do this, you need a separate analysis on the current construction trend...which is quite volatile..sorry to tell. (which is why business ratio is recommended to be included)

Overall, in this limited space, I would recommend you to first split between 'construction services' and 'construction product' - in short, make two business plans first then consolidate them together. Otherwise, you may potentially face confusion here and there if you mix both together. (Trust me)

Okay, that would be all for now....I wish you the best in everything you do.
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PostPosted: Sat Jan 12, 2008 12:07 pm    Post subject: ARCHI./SUSTAINABLE DESIGN 6 :ENERGY/CONSERVATION 3-Nik Zafri Reply with quote

The Star Global Malaysians Forum
Posted: 26 September 2006 at 11:58am

Comments by ahvincent

Nowadays most Owners insist that we design certain basic "green" peinciples into buildings. The guideslines are still pretty loosely defined but generally speaking our designs do incorporate the basic generally accepted "green" principles and must be efficient and economical to build.
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Posted: 28 September 2006 at 10:59am

Further comments by ahvincent

I read somewhere they have started to construct a wind farm in the Mornington Peninsula in Victoria where it is always windy 365 days a year. I think they are saying that eventually there will be 2,000 such mills in the farm.

Some people say it is not economical....but I don't know or understand why it wouldn't be. It certainly is eco friendly. Well, I will just have to wait and see what will come out of it in the future.

Co-generation of electricity is already practised in parts of Europe and Japan. Australia is currently building a massive wind farm to generate power. It's success remains to be seen.
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Posted: 29 September 2006 at 6:59am

Response by gleearch

Ahvincent,

There will always be detractors who will say wind farms and pv farms are not feasible.

The question to ask is, compared to what?

A diesel burning electric generator? While they build those things in masses, it still takes fuel to fire up and operate. Not to mention the pollution etc.

Yet wind farms and PV use free energy. Since all generators need to be maintained, upkeep costs are somewhat moot. Though with PV, it's really low maintenance.

What most people don't realise is that these wind turbines are getting smaller and more efficient. Some are now being installed on high rise buildings to take advantage of the high wind speeds near the tops of these buildings. In some ways this is better, because you are utilizing urban space instead of green fields.

It's mainly the oil lobby which likes to kcik up a big fuss about the costs of going green. Unfortunately for them, those arguments don't hold much water now. The cost of green is coming down fairly rapidly and most new buildings that use LEED or similar sustainable design strategies are seeing these cost fast closing the gap with conventional construction.
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Posted: 29 September 2006 at 6:24pm

Nik Zafri's Comments

I think it's a fabulous idea to have wind turbines installed on top of buildings esp. here in Malaysia. I've seen it abroad but never seen it in Malaysia so far. The higher the building is the better - where wind is fastest. I ain't sure about the cost say...RM..../kWh. But I do know it's cheaper than nuclear.

I'm not sure about old buildings Gerard, probably they are not designed for stress from wind turbines compared to new buildings packaged together with wind turbines.

However, with oil/coal/gas are depleting, wind turbines can become an economical option.

I've also read somewhere about green building standard - it talks about renewable energy and fuel cell equipment - that will enable us not to be overdependent on fossil fuels and conventional electricity. Examples quoted - solar water heaters, photovoltaic systems and wind turbines.

You can see something even more interesting over here as well. The pic below is the FUTURE!



http://www.esru.strath.ac.uk/EandE/Web_sites/01-02/RE_info/Urban%20wind.htm

Wind power can be used to generate electricity in an urban environment. The easiest way to do this would be if everybody built a 600kW turbine on the top of his or her house.

This is quite clearly not feasible, but urban wind generation is. The University of Strathclyde in Glasgow was involved in a project to redevelop the Lighthouse building in Glasgow. The Energy Systems Research Unit was involved to show how renewable technology can be utilised. One device they decided to use was a Ducted Wind Turbine.

This device sits at the edge of the roof of a building and utilises the updraft of the airflow along a building side. The air flows upwards, hugging the building wall then enters the front of the duct. The arrows above show the flow through the turbine. The spoiler at the top of the turbine also utilises a PV module to increase generation from renewable energy. The spoiler is optimised to create a pressure differential across the duct and the PV is mounted at this angle.

The devices are relatively small with a blade diameter of 600mm so they possess very little visual impact on a building.



These devices are suitable for an urban environment but not households. They are more suited to office buildings and high rise buildings rather than a small household. These devices are unlike most other common wind turbines in the fact that they are uni-directional. As explained in the Beginners Guide most turbines will position themselves perpendicular to the flow of the wind. A HAWT will yaw into position and a VAWT is always in the correct position. These turbines are fixed into position so are dependant upon the wind blowing in the correct direction. Because of the duct the turbine will perform favourably to a wind direction variability of 120o. (60o to each side of perpendicular to turbine.)



The wind direction is Scotland is predominantly south-westerly so the turbines should be positioned on the South and West edges of any structures roof.

Theoretical Power Outputs

Using the devices installed at the Lighthouse an approximation on the power outputs can be made. The theory from the Beginners Guide to Wind applies here.

Air density ( ) = 1.225kg/m3
Diameter (D) = 0.6m
Wind Speed (V) = 10m/s
Cp = 0.35

Swept Area of Rotor = R2 =0.2827m2



P = 173.18W (This is the theoretical power available)



P = 60.61W (This is a realistic value of power available)

The value above shows the power available theoretically for a single ducted turbine, but in real terms they would be installed in banks along the edge of a building roof.

One single ducted wind turbine would produce 530kWh electricity per year

An average installation would probably consist of 10-ducted turbines; this would yield an annual energy production of 5308.56kWh. The installation of a PV on the spoiler would again increase the power output and if the same module from the Urban PV section is used the expected power for a bank of 10 ducted turbines would increase by 722.93kWh to 6031.49kWh per annum, assuming that each ducted turbine has one PV module installed on its spoiler, which covers an area of 0.61596m2.

Actual Power Outputs

The previous calculation assumes the basis that the wind speed would be constant at 10m/s for the duration of the year and that the wind would be blowing in the correct direction of the turbine. The value of power produced from these machines will be less than stated above because of these stated assumptions.

An estimation of the expected wind speeds in Glasgow could be made using data collected in Bishopton (10 miles south-west of Glasgow) (NGR = 2418E 6711N - Altitude = 59 metres - Latitude = 55:91 N Longitude = 04:53 W) every hour during 2001-



The chart shows the availability of the wind at certain angles including the 60o availability. It clearly shows southwest to be the predominant wind direction. The chart shows that in the southwest direction that the wind is only available 11% of the year at 10m/s. Obviously the wind will blow at speeds less than 10m/s but as explained in the beginners section this would greatly reduce the power output. Again the wind will blow at speeds greater than 10m/s and greatly increase the power output but this would be a rare occurrence throughout the year.

The theoretical power outputs shown above are probably the upper limit of the power expected from these ducted machines and a capacity factor of about 25% is more realistic, knowing that for HAWT in Scotland the capacity factor is approximately 35%, since these ducted turbines are uni-directional.

Therefore a realistic power output from a single ducted turbine would be

(530.856 x 0.25)+ 72.293 (from PV) = 205kWh/year

Individual Possibilities

We have discussed how it would not feasible to expect everyone to have a wind turbine on their roof but there is a lot of unused roof space in city centres on large office buildings and also factories roofs could provide an ideal place for wind turbines to be deployed. As we are unsure of the roof area available in Scotland, this example will demonstrate the effects of a wind turbine for every person in Scotland (5,115,000 people)

One wind turbine (530.856 x 0.25)+ 72.293 (from PV) = 205kWh/year

This would result in an electricity production of;

i) = 205(kW) x 5,115,000= 1,048,575,000kWh

1,049GWh, which is 3.3% of Scotland's yearly electricity consumption
(Scottish Total = 32037GWh)

National Benefits

The introduction of ducted wind turbines could result in an annual reduction of carbon dioxide emissions in Scotland, every kWh of electricity produced from fossil fuels results in 0.97 kg of CO2

i) 0.97kg x 1,048,575,000kWh /year = 1,017,117,750 kg/CO2



1.4 % of Total Scottish CO2 Emissions - (1.4 % of 72,300,000,000 kg)

The future

No estimation on the cost of installation can be made, as these devices are very much in the research and development stage at this moment. The research into this field is growing as more people become interested in urban wind generation. Below are some images of ideas to utilise urban wind generation. A website exists that is only interested in the development of wind turbines for the urban environment. (www.urbanturbines.com).

Such a technology could be deployed relatively cheaply in the future however more research has to be carried out to examine the energy production potential and where electricity produced could be used successfully. Many designers are considering the integration of wind turbines within buildings again it is not yet known how feasible this will be.
-----------------------------------
Posted: 30 September 2006 at 12:59am

Response by gleearch

Nik,

Large system obviously would have a difficult time being retrofitted to old buildings. That's where PV panles and smaller wind systems could be used.

That's another issue. The reuse of older buildings.
More along the lines of saving and recycling historical buildings. Too often as we have seen throughout asia, beautiful old buildings are torn down and replaced by what is touted then as the future. Half the time, they are ugly boxes with no real design in them.

However recycling buildings, salvaging them and reusing them is another otpion of being green. Green isn't always about building a brand new building with all the latest technology.

Sometimes it's about reusing an old building. Some of these buildings have huge timbers, etc that you cannot find today. So it's worthwhile to salvage those materials if not reusing the building. If the existing building is reused, obviously there are issue with hazardous materials etc but those can be mitigated and old HVAC systems can be replaced. A good designer can make the most out an existing space or create additions which respect or work well to ennhance the existing building.

There's is so much more to being green. It's a good time to be working on saving the environment.
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PostPosted: Sat Jan 12, 2008 12:08 pm    Post subject: ARCHI./SUSTAINABLE DESIGN 5 :NO TO NUCLEAR!!-Nik Zafri Reply with quote

The Star Global Malaysians Forum
Posted: 06 August 2006 at 7:27pm

Nik Zafri's Comments

Here's an article from Greenpeace :

Nuclear power: No solution to climate change

�Nuclear power is expensive, slow and dangerous and it won't stop climate change. If the answer is nuclear power, it must have been a pretty stupid question.� Ian Lowe President, Australia Conservation Foundation.

The new battlecry of the nuclear industry is that nuclear energy is the answer to global climate change. Nuclear energy is toxic and dangerous. Far from being rehabilitated, the nuclear option is a convenient distraction from the problem of climate change and stalls real action to combat it.

Nuclear power lobbyists are correct that climate change demands an urgent and quick response. But replacing polluting coal and other fossil fuel-based power with another environmental disaster -- in the form of nuclear power -- is NOT the answer we need. Our best long-term solution for an emission free and greenhouse-friendly future are the truly clean and green renewable energy sources � particularly wind and solar - combined with technologies that vastly improve energy efficiency.

In Asia...

Asia is projected to have the largest growth in installed nuclear generating capacity from 2002-2025, accounting for 96% of the total projected increase.

Cost: Nuclear power is more expensive. Not only is nuclear power more expensive than fossil fuel generation and clean, renewable wind power, it also leaves a legacy of unsafe yet highly expensive technologies. Costs associated with safety and security, insurance and liability in case of accident or attack, waste management, construction and decommissioning are rising substantially for nuclear power, while the cost of wind and solar power is falling. Nuclear power plants have only presented a veneer of economic viability in the past due to heavy government subsidies. As energy markets have liberalized around the world, investors have turned their backs on nuclear energy. The number of reactors in western Europe and the United States peaked 15 years ago and has been declining since. By contrast, the amount of wind power and solar energy is rising at rates of 20 to 30 per cent a year.

The hazards associated with nuclear power include the risk of potentially catastrophic accidents like the 1986 Chernobyl nuclear reactor disaster, routine releases of radioactive gases and liquids from nuclear plants, the problem of nuclear waste and the risks of terrorism and sabotage. The International Energy Outlook 2005's projection that Asia will have the largest growth in nuclear generation in the next two decades exposes the region, which consists mostly of developing countries to these hazards, more than any other region. Asia will soon be dumping ground of nuclear technology if we do not reject this trend. and work in favor of renewable energy and improved efficiency.

Waste: Nuclear waste disposal is still an unsolved problem. The most dangerous form of pollution ever created, nuclear waste remains radioactive for hundreds of thousands of years. Uranium mines typically generate volumes of long-lived, low level waste which is kept on site. Reactors release radioactive emissions to air and water. Reprocessing plants generate a high-level radioactive waste stream and emissions to air and water. All these pose risks to the health of the public. Monitoring and maintaining waste deposits over a period spanning 20 times the length of known civilization is an unacceptable burden we are placing on all future generations � with no guarantees of long term safety.

Nuclear proliferation: Nuclear technology, such as uranium enrichment is also used in nuclear weapons production, and therefore a proliferation risk. There are now more than 40 countries with the capacity to build nuclear weapons, and international efforts to stop the proliferation of nuclear weapons technology are failing. Nuclear technology will always carry the risk that it will be used to construct weapons of mass destruction.

Greenhouse polluters: Claims that nuclear power is �emissions free� are false. Substantial greenhouse gas emissions are generated across the nuclear fuel cycle. Fossil-fuel generated electricity is more greenhouse intensive than nuclear power, but this comparison only holds true if high-grade uranium ores are available. Even with such high-grade ores, there is a massive increase in greenhouse pollution from mining, processing and reactor construction before any electricity is generated. The known resources of high-grade uranium ores only amount to a few decades' use at the present rate. Most of the earth�s uranium is found in very poor grade ores, and recovery of uranium from these ores is likely to be considerably more greenhouse intensive. Nuclear power emits more greenhouse gases per unit energy than most renewable energy sources, and that comparative deficit will widen as uranium ore grades decline.

Safe, clean alternatives

To avoid dangerous further changes to our climate, we need to act now. Asia in particular should make a commitment to the sensible alternatives that produce sustainable cost-effective reductions in greenhouse pollution: wind power, solar water-heating, energy efficiency, gas and energy from organic matter. Renewable energy and energy efficiency can deliver the power we need � without the environmental and social problems.

Renewable energy already supplies 19% of world electricity, compared to nuclear�s 16%. The share of renewables is increasing, while nuclear�s share is decreasing. Renewable energy sources such as wind power and solar power are growing by 20-30% every year. In 2003, the cumulative installed capacity of solar photovoltaic (PV) systems around the world passed the landmark figure of 2,400 Megawatts of solar photovoltaic power. Global shipments of PV cells and modules have been growing an average annual rate of more than 35% for of the past few years, providing employment for 10,000 people and generating business worth more than 3 billion euros annually. Wind power, on the other hand, is the world�s fastest growing energy source with installed capacity growing at an average annual rate over the last 5 years of 15.8%

Renewable energies have truly limitless sources, can be more easily deployed in remote developing regions, present absolutely no risk to global security and are environmentally-friendly.

Because there is only a finite amount of investment available for new energy, any investment in nuclear power is effectively money denied to renewables and energy efficiency. Nuclear power, with fifty years of failure as its track record and still no solutions to its fundamental problems, remains a shockingly poor investment choice. The wise decision then, is to say no to nuclear, yes to renewables and energy efficiency.

So, with this, I say 'bye-bye' to nukes!
-----------------------------------
Comments by ahvincent

Nuclear power plants do not produce the same amount of green house gas pollutants but they produce another kind of pollutant, Nuclear Waste.!!! And nuclear waste will kill you a lot quicker and have a half life of hundreds of years with a potential to kill even more is it gets out of control !!!

Some of our Oz politicians have got s*&t for brains !!! They have completely missed the point, surely it would make more sense in trying to develop wind powered turbine farms or look at harness more hydro energy.

All along the coast around the Great Australian Blight the wind is very strong 24/7/365. It lends itself to wind farms and with modern light weight turbines which are very efficient I think they should investigate that option.
--------------------------------
Response by gleearch

Ahvincent,

I agree. Nuclear energy isn't a cure all. Nothing sustainable about it at all. You are right. A pollutant or waste is still waste. In this case highly dangerous. There's still not good way to get rid of nuclear waste. I don't think dumping them in concrete holding facilities is really doing any good. Or storing them under sea.

There's plenty of sun and wind in Australia as you pointed out. Some of the new skyscrapers going up in new York have built in wind turbines to generate electricity.

They keep on developing new wind turbines that can reduce accidents with birds. No pollution. Plenty of cheap renewable energy. Same with solar panels.
--------------------------------
Posted: 09 August 2006 at 8:15am

Response by ahvincent

I will recount a first hand story about an early experimental plant using solar energy generated electricity system. I used to work with a major USA based power generation company many years ago. They installed one of their early prototypes on an isolated village in Papua New Guinea. These villages did not have electricity and no road access. All diesel fuel will have to be flown in thus making it prohibitively expensive. So solar power was an ideal solution to bring the marvels of modern science to these primitive jungle tribes.

We intalled a solar powered generation plant enough to provide the bare essentials to the village. This system had a diesel motor as a backup to charge the batteries in case of a cloudy day or an emergency.

Everything seem to be working fine when our technicians were on site but once they left we keep getting calls that our system was not functioning properly. They have to use the diesel generator all the time and the authorities had to keep flying in fuel at a great expense.

So we send our technicians in and they found out that the natives who have not seen an electric light in their lives were keeping all the lights on all night and sitting around the lights watching it. Little wonder that the supply ran flat before morning.

Anyway the project was deemed a failure for a variety of reasons and we did not sell more than a handful of our remote solar electricity plants. That was many many years ago, I am sure the price of solar cells have got more efficient and less costly now and maybe this type of projects may become more cost efficient now. I don't know.

An other example (of what seems to be a good idea at the time) of another experimental project gone wrong is the big black (W) towers in Pittsburg. If you go to Pittsburg you will see a great big (I cannot tell you the name) electric sign next to where the Ohio & Mo...(I cannot spell the name) rivers. I don't know if the sign is still there now.

This sign is lit by thousands of light bulbs. The idea was to collect the heat given off by the bulbs in the sign and the building to drive the air-conditioning in the building. Someone's brilliant idea at the time. The end result - all the lights in the sign and the building had to be left on 24/7 otherwise no air conditioning.

Disastrous experiment costing millions. At the end they just had to connect the air condition back to the usually supply source.

On one particular conference I attended someone had another brilliant idea for storing electricity. We all known batteries are very ineffcient at storing large quantities of electricity, so his idea was to use off peak power to pump water to a pool at a higher level and during peak demand periods let the water drain back down driving turbines in the process. Electricity is thus stored in the form of kinetic energy.

Other bright ideas include using off peak power to wind up a series of gaint coil springs. This did not arouse the same level of interest as the first idea,
---------------------------------
Posted: 09 August 2006 at 11:27am

Response by gleearch

Ahvincent,

Interesting stories. That's what happens when not a lot of thought is given to the idea. Using light bulbs to power air conditioning? Duh! as homer simpson would say. Using electricity to power up the lights and then using the heat from it to power the air conditioning.

I mean, what were they thinking.

Ok I'll offer these instead.

Ice skating rinks generate heat. That is the cooling machinery used to create the ice on the rinks generate heat. (I'm simplifying things overly much) It is common practise now to use that waste heat for other uses. Melting snow around buildings so people don't slip and fall etc.

It's about using waste heat and having a secondary system in place. Not creating a whole system to generate waste heat just to power something else.
----------------------------------
Posted: 30 August 2006 at 10:11pm

Response by stingray2000

Nuclear Power Won't Fix It

Nuclear power is not the answer to tackling climate change or security of supply, according to the Sustainable Development Commission in Scotland.

The SDC nuclear report draws together the most comprehensive evidence base available to find that there is no justification for bringing forward a new nuclear power programme at present � supporting current Scottish policy.

Scottish Commissioner, Hugh Raven, says:
�Our report proves how right Scotland is to fight for its �no nuclear� policy. We�ve thoroughly investigated nuclear power over the last year, but have found that any potential benefits are outweighed by substantial disadvantages. With our amazing renewable resources � combined with some serious political willpower � Scotland could become a true world leader in clean, sustainable energy.�

�The SDC urges the Scottish Executive to stick to its position of not supporting the further development of nuclear power while waste management issues remain unresolved. Nuclear is not the answer for climate change or security of supply.�

In response to the UK Government�s Energy Review, the SDC report gives a balanced examination of the pros and cons of nuclear power, based on eight new research papers.

Its research recognizes that nuclear is a low carbon technology, with an impressive safety record in the UK. Nuclear could generate large quantities of electricity, contribute to stabilising CO2 emissions and add to the diversity of the UK�s energy supply.

However, the research establishes that even if the UK�s existing nuclear capacity were doubled, it would only give an 8% cut on emissions by 2035 .This must be set against the risks.

The report identifies five major disadvantages to nuclear power:

1. Long-term waste � no long term solutions are yet available, let alone acceptable to the general public; it is impossible to guarantee safety over the long-term disposal of waste.

2. Cost � the economics of nuclear new-build are highly uncertain. There is little, if any, justification for public subsidy, but if estimated costs escalate, there�s a clear risk that the taxpayer will be have to pick up the tab.

3. Inflexibility � nuclear would lock the UK into a centralised distribution system for the next 50 years, at exactly the time when opportunities for microgeneration and local distribution network are stronger than ever.

4. Undermining energy efficiency � a new nuclear programme would give out the wrong signal to consumers and businesses, implying that a major technological fix is all that�s required, weakening the urgent action needed on energy efficiency.

5. International security � if the UK brings forward a new nuclear power programme, we cannot deny other countries the same technology*. With lower safety standards, they run higher risks of accidents, radiation exposure, proliferation and terrorist attacks.

On balance, the SDC finds that these problems outweigh the advantages of nuclear. However, the SDC does not rule out further research into new nuclear technologies and pursuing answers to the waste problem, as future technological developments may justify a re-examination of the issue.



Download the reports:

Full SDC position paper
� The role of nuclear power in a low carbon economy
A commentary by Jonathon Porritt
� Is nuclear the answer?

Or order your free hard copies

SDC Chair, Jonathon Porritt, says:
�It�s vital that we get to grips with the complexity of nuclear power. Far too often, the debate is highly polarised, with NGOs claiming to see no advantages to nuclear at all, and the pro-nuclear lobby claiming that it�s the only solution available to us.

�Instead of hurtling along to a pre-judged conclusion (which many fear the UK Government is intent on doing), we must look to the evidence. There�s little point in denying that nuclear power has benefits, but in our view, these are outweighed by serious disadvantages. The UK Government is going to have to stop looking for an easy fix to our climate change and energy crises � there simply isn�t one.�

Concluding with advice on a future energy strategy, the SDC report establishes that it is indeed possible to meet the UK�s energy needs without nuclear power. With a combination of a low-carbon innovation strategy and an aggressive expansion of energy efficiency and renewables, the UK would become a leader in low-carbon technologies. This would enhance economic competitiveness whilst meeting the UK�s future energy needs.

ENDS

[Notes to Eds:

- The SDC nuclear review, research papers and audio launch interview with Jonathon Porritt are available to download at www.sd-commission.org.uk.

- The SDC has spent a year gathering evidence and agreeing its position on nuclear power.

- The process for developing the SDC position on nuclear power has been rigorous and transparent. During the process, the SDC identified three divergent positions on nuclear power: position 1 - NO, position 2 � NOT NOW, position 3 - MAYBE.

SDC Commissioners voted as follows: eight Commissioners favoured position 1, five favoured position 2, and two favoured position 3.
As part of the current Energy Review, we expect the Government will go through a comparable decision-making process, and we advise them to be similarly transparent.

- The SDC nuclear review is based on eight new research papers
(see attached evidence base summary for key facts):
1. An introduction to nuclear power � science, technology and UK policy context,
by the Sustainable Development Commission
2. Reducing CO2 emissions: nuclear and the alternatives,
by the Sustainable Development Commission
3. Landscape, environment and community impacts of nuclear power,
by the Sustainable Development Commission
4. The economics of nuclear power
by the Science & Technology Policy Research (SPRU, University of Sussex) and NERA Economic Consulting
5. Waste and decommissioning
by the Sustainable Development Commission with contributions from Nirex and AMEC NNC
6. Safety and security
by the Sustainable Development Commission with contributions from Large & Associates and AMEC NNC
7. Public perceptions and community issues
by Professor Robin Grove-White, Dr Matthew Kearnes, Dr Phil Macnaghten and Professor Brian Wynne
8. Uranium resource availability
by Future Energy Solutions, an operating division of AEA Technology plc

- The Sustainable Development Commission is the government advisory body on all matters relating to sustainable development, reporting to the First Minister in Scotland and Prime Minister at UK level . Through advocacy, advice and appraisal, we help put sustainable development at the core of Executive policy.

SOURCE: Sustainable Development Commission UK
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PostPosted: Sat Jan 12, 2008 12:09 pm    Post subject: ARCHI./SUSTAINABLE DESIGN 4 :ENERGY/CONSERVATION 2 Reply with quote

The Star Global Malaysians Forum
Posted: 07 July 2006 at 6:48am

Comments by kl_changs

Hi Flick,

How much is the subsidy for the solar water heater? Is it applicable in WA?

Do you know why the take up isn't great?

We use solar water heater. No subsidy at all . But it just seemed so practical to use the sun as an energy source since we're living in the tropics. I just hope that the scientists out there would come out with other domestic applications quickly - that would not cost an arm & leg.

cheers!
-----------------------------------
Response by flick068

kl changs,

have a look here -
http://www.greenplumbers.com.au/index.php?pageID=7

in victoria, the rebate is A$1,500 but not sure about other states. and i don't know the total cost of the system plus installation.. not much help I'm afraid.

why no take up? i guess ppl move so much here that they might think they won't get the full benefit even with the rebate, ie 'what's in it for me' mentality

another thing in Oz is that if you put up panels for generating elec, you can hook it up to the mains. So if you generate more from your panels than you use, you feed it back to the mains and you get a credit for that. That's quite a good incentive. Do you think Msia would do that?
-----------------------------------
Nik Zafri's Response
Posted: 07 July 2006 at 6:59pm

To flick and kl_chang

Sunny outlook for SOLARin
By Sharen Kaur - [email protected]
July 3 2006

MALAYSIA gets more sunlight than many other countries in the world, and while others might complain about the heat and run for shade, one local company hopes to make big bucks from the great fireball in the sky.

SOLARin Holdings (M) Sdn Bhd, together with Denmark Solar Industry (DSI), is working to invent new and innovative solar system products for the Malaysian market. DSI, a specialist solar system producer headquartered in Copenhagen, Denmark, is a family-based business venture of Datuk Naser Ismail, who is also the executive chairman of SOLARin. Solar-powered products have been expensive hitherto in Malaysia because they are imported from developed countries where the cost of production is high.

With SOLARin producing in Malaysia, the cost of such products should become more affordable and therefore gain wider acceptance, Naser said.

"We in Malaysia should take advantage of this gift (sunlight) from God," he added. "SOLARin was set up in Malaysia to act as a hub to distribute solar products globally," he said. "With the finding of very high quality of raw materials (silica) in Terengganu and the fact that Malaysia has more sun than any other parts of the world, we decided to also establish a manufacturing plant here," said Naser.

SOLARin is developing Solar Valley in Teluk Kalong in Kemaman, Terengganu, spread over 32ha. The project, which is expected to be completed by May next year, will be built at an initial cost of RM1 billion, and make products for the growing demand globally.

"The plant in Malaysia will produce products for DSI. It will be very cost-effective for us," said Naser.

DSI has plants in Sweden, Sudan, Jamaica, Germany, Jordan, South Africa and Bangladesh.

Naser also said that SOLARin has plans in the pipeline to produce the world's smallest solar-powered LED (light-emitting device). SOLARin, which has a number of associate and subsidiary companies in Malaysia, produces solar-based products from raw materials to finished products for the local and export markets.

The group makes solar panels and solar-related products, including solar batteries; wiring systems; solar car cooling systems; mountings; street, garden and park light poles; super bright low energy lights; bus stops and golfwagons; water heater systems; road signages; billboard applications; public phones; park pay systems; cones; road markers, cat eyes; lighted safety jackets; pavement markers; camping lights; and mobile phone and car chargers. It also produces solar chargers, tents and generators for the military and the Government as well as metal casings for batteries and containers and covers for all solar-related products.

"We recognise that our work is often conducted on a condition of critical- path items of equipment and always- in-time critical environment. "That is why we are assisting our clients to optimise their efficiency in the execution of any project, particularly solar-related products and solutions," said Naser.

SOLARin aspires to become the leading solar energy manufacturer in Malaysia and a global market leader of solar applications, solutions, accessories, new technologies, and transfer of knowledge and competence. It also aims to lead the industry to new standards and technology of solar innovation, develop an independent supply of raw materials covering all processes from mining to final solar panel production, and to remain competitive.

"The support we get from the State Government of Terengganu is overwhelming," added Naser.

SOLARin recently showcased the world's first solar-powered motorbike, which Naser said has been widely accepted.

& don't miss this link as well.

You'll see the 'connection' between the 2 infos that I've given you.

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Posted: 09 July 2006 at 9:53am

Response by gleearch

Wow, I've been away for awwhile. Glad to see so much activity here.

Let's look at this in a holistic manner. While subsidies would be a good thing, it usually falls to the consumer. Even in the states, they initially had subsidies during the energy crisis of the 70s for alternative energy sources.

When oil drop in price, those subsidies and tax breaks evaporated. Oil has a big lobby.

So who does it fall to?

Well the consumer. Prices for solar powered electrical fixtures have fallen and they are becoming more common place. Why?

Because people are more aware of the need to conserve energy.

The same will happen eventually in other countries. The one thing to note is that the initial cost of installing solar panels or photovoltaic panels (PV) is that they pay for themselves after a few years. it use to be 25 years but because of the ever rising energy rates and the lowering of cost for producing these panels and with more competition, some communities are seeing ROI in less than 10 years. In some places they report within 5yrs.
In m'sia the cost are still high but hopefully with more manufacturers like those posted by Nik, there will be more competition and prices will come down.

Tying your PV plant back to the grid is common and makes a lot of sense. If you have a PV farm that generates more power than you need, you'll be able to have positive income by selling that excess energy back to the utilities.

Plus with educational facilities taking a lead role, eventually there will be wider dissemination about the need for sustainable design and energy sources.

Take a look at this link if I haven't posted it before:

http://www.eere.energy.gov/solar_decathlon/final_results.html
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Posted: 09 July 2006 at 9:58am

Further comments by gleearch

Oh, remember that it isn't all about using solar.

Reducing energy usages by using energy efficient appliances help. Having a well insulated home and one designed to work with the climate as opposed to trying to go against it.

There are so many ways of having a home built in a way that can lower your overall energy requirements and create a home that is healthy and comfortable.

I do have some FAQs about sustainable design on my firm's web site that provides a basic understanding of the issues.

The other other resources on the web that have even more information.
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Posted: 24 September 2006 at 3:20pm

Further response from gleearch

flick,

This is in response to your question in the other thread. I think it makes sense to keep the answers in one location so that it is easy to find.

Anyway:

You can actually pull some of this info off the web. there are plenty of articles and information from solar panel manufacturers etc.

The numbers I give here are just assumptions and base on imperial units and US dollars. So convert and add for additional taxes etc.

Solar power isn't cost effective in some areas but where you have remote locations and plenty of daylight hours it could be.

Say for arguments sake that the average household in Malaysia uses about 200Kwh/ month. That's about 6.8kwh/day.

So let's make another assumption. We have daylight in Malaysia from
roughly 7am till about 8pm. So lets just round it down to about 10 hours to be conservative. if we have more hours that's better but I just prefer to be conservative for now.

6.8kwhx1000= 6800watts needed a day.

Say an average size panel is about 24"x36" and produces about 165W. (you can shop around)Take that and multiply by the 10hours available a day. Remember that you need optimum sun angles and open sky (no trees shading the panels etc.) So you get about 1650w a day from a single panel. But you need 6800watts. You can slightly oversize it or undersize it, depending on your needs.

Let's say we oversize it. 5panels x 1650watts= 8,250watts. We now have an excess of 1,450watts.

The rough estimate here is that it costs roughly US$5 per watt or more depending on where you are. Say we just use that number in M'sia. factor in cheaper labor and the availability of lower price panels coming from china. So with inverters, battery back up wiring etc , lets say it costs about US $960 a panel installed. You are looking at roughly US &4800 for each household.

Ok multiply that number by 4 to convert and that's a very conservative RM$19,200 to bring solar power to each rural home. It might costs more but let's look at this from another viewpoint.

If you bring in electricty from the grid to that house, the house has to continue paying an electric bill every month. With a solar PV system, there's no electric bill to pay. Assuming you size it to make the house 100% PV powered.

So take that electric bill and add it up every month until it equals the cost of the PV system. That's how long your PV system will pay for itself. That's right. Pays for itself. From then on, it's money in your pocket.
Ok, look at this from another viewpoint. Many of this systems are connected to homes tied to the electric grid. If you generate more power than you use, it turns back your meter. Basically you are selling power to the utility company. Your system is making you some money.

Take that excess power we have in the calculation above and look at your electric bill. use the cost per kwh to see how much you will get a month.

Solar power definitely makes sense in todays economy. Obviously in countries with less daylight hours, they have to factor that in and solar energy costs goes up.
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Posted: 24 September 2006 at 8:35pm

Comments by ghost001-adie

gleearch wrote:
....You are looking at roughly US &4800 for each household.
Ok multiply that number by 4 to convert and that's a very conservative RM$19,200 to bring solar power to each rural home. It might costs more but let's look at this from another viewpoint.


Yes gleearch, I've checked, I'm in Sabah you know where they are testing the technology. It is about the estimate that you've mentioned here.

gleearch wrote:
If you bring in electricty from the grid to that house, the house has to continue paying an electric bill every month. With a solar PV system, there's no electric bill to pay. Assuming you size it to make the house 100% PV powered. So take that electric bill and add it up every month until it equals the cost of the PV system. That's how long your PV system will pay for itself. That's right. Pays for itself. From then on, it's money in
your pocket.

Ok, look at this from another viewpoint. Many of this systems are connected to homes tied to the electric grid. If you generate more power than you use, it turns back your meter.


This is a very interesting idea!

gleearch wrote:
Basically you are selling power to the utility company. Your system is making you some money. Take that excess power we have in the calculation above and look at your electric bill. use the cost per kwh to see how much you will get a month. Solar power definitely makes sense in todays economy. Obviously in countries with less daylight hours, they have to factor that in and solar energy costs goes up.


Another interesting idea indeed. You'll be surprised that I come to understand that it was the IPP (independent power provider - private sector) in malaysia - were the ones that came out with these bright ideas - unfortunately, most of the IPP gonna be sidelined soon. Even Petronas has their very own power generation plant (co-gen) almost wholly owned by them to generate various kinds of energy to refineries (last time it was IPP that did the job) and the balance is expected to be sold to the local grid.
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Posted: 25 September 2006 at 1:44am

Response from gleearch

ghost,

Thanks for confirming the numbers.

It's far more cost effective to install PV panels in rural villages with battery back ups. They don't even have to be installed on the houses but could be remote from it. Though by installing them on the houses you are using existing infra structure and not having to clear more forest. A better proposition.

Having the large energy firms like petronas start supplying alternative energy through cogeneration is one thing, letting home owners get off the grid or even generate some income is another. It's a win win situation for the utility. By having more homes go off grid and in some cases sell cheap power back to them, they get to sell this power during peak hours back to industry and make more money. On top of that by reducing the load, it enables them to channel money into other matters instead of having to build new power generation plants.

Cogeneration still creates pollution. PV is cost effective and renewable and there's no pollution. Same can be said about wind power though birds have a tendency to fly into the turbines.

PV panels need to be maintain and cleaned to stay at peak performance. Malaysia has abundant sunlight, why not use it?

What people need to realise is energy comes at a costs. Not just what you see on the electric bill. But the fuel used to generate the power tends to pollute. Even hydro electric power has consequences. It dams up rivers and drowns habitats and in some cases can wipe out entire ecosystems and species.

With fuel prices climbing and they always will. Petroleum is a limited resource, it will run out one day.

It means that everything that needs energy to create it or run it will cost more.

So why not find a way to use free energy and maybe make an income from it. The sun isn't going to send you an electric bill.

There are so many possibilities.

Imagine if a home owner in a rural village set up power to supply his home. It means he can now do more work at night and be more productive. Maybe run a tv set and charge others for the privilege of watching his tv.

Then say he invest more money into more panels and uses the excess to power up other homes. he becomes a small utility. Selling free energy.

Just think....
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Posted: 31 July 2006 at 4:36pm

Nik Zafri's Comments

I read a paper from OECD by Richard Doornbosh & Simon Upton - an interesting topic on R & D priorities & programmes to support the future energy technologies.

Based on their research, the two main questions being raised :

1. Are there technical possibilities within reach that would enable us to meet the expected demand for energy in more secure and less polluting ways?

2. Are there global investments in researching, developing and deploying these technologies focused where they are likely to leverage the most significant gains, and is the critical mass of investment sufficient given the timescales in which we may wish to effect changes to the energy supply?

These questions were being explored further to :

1) The first (question) is security of supply. This arises principally in respect of the concentration of remaining oil supplies in politically unstable regions of the world. How can the world�s leading economies insulate themselves from the risk of disrupted energy supplies?

2) The second is sustainability given the need to stabilise atmospheric concentrations of greenhouse gases at levels that minimise the risks of significant climatic disruption.

How can the global economy satisfy a strongly rising demand for energy services without a huge increase in total greenhouse gas emissions? (which I think we did talked about almost similar issues)

To the end of the paper :

Whether we are talking about new renewable forms of energy or clean fossil fuel, there are significant costs. If a negotiated limitation on emissions designed to created a �market pull� incentive to bring these technologies on-stream is beyond realistic diplomatic possibilities, the question then arises whether �technology push� policies can achieve the same thing. Research, development and deployment expenditures by governments are one such policy lever.

It is difficult to say what level of investment in R&D would be needed to bring new technologies forward. But the trends of what is now being spent are not encouraging.

While public budgets for R&D have been on rising in recent decades, public expenditure on energy R&D has been declining. This decline has not been compensated by private sector expenditures which have also declined in absolute terms. If we measure R&D intensity (R&D expenditure as a percentage of total turnover) in the energy sector, the level has more than halved from an already low level as opposed to a trend of slightly rising R&D intensity in other sectors. It is not difficult to see that these trends have been in stark contrast to the climate change challenge that seems to have become more compelling over the same period.

What fascinates me most were the graphs/statistics/datum being shown on how R & D budget allocation globallly have been showing a decreasing trend (attention) year by year and perhaps how people want new technology to be introduced as fast as possible which may have lead to unforeseen long-term failure.

So what do you think Gerard?
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Posted: 03 August 2006 at 11:53pm

Response by gleearch

Nik,

Good find.

You know how I always use the term "holistic". It short it refers to looking at things in many different ways. ( holistic - emphasizing the organic or functional relation between parts and the whole).

There is an emphasis on global warming right now. Well you can't help but notice it when it's in the news everyday and people are literally being cooked.

But what caused it? Obviously scientists can debate this back and forth. (somewhat dependant on who is funding that scientist's point of view or research- environmental group or petroleum/ energy).

But I think it's safe to say that it's mainly from human based activities that has resulted in this crisis. Industries, buildings and transportation need and use energy. They generate pollutants which in turn affect our athmosphere and climate. Obviously a very simplified way at looking at it. So many things hinge around each other.

What I am trying to say is this: Everything we do is dependant on something else or causes something else to happen other than what was intended. We want to get from point A to Point B but we use a car, train, airplane. That mode of transport uses electricity, gasoline or some other energy source. This is in turn results in heat being generated and pollutants being expelled. One way or another, either directly or indirectly.
It is the nature of how we do things. We do get to point B but for the most part don't think about what happened to get us there.

Again, the trick is to recognize this and find ways to reduce the waste and pollutants we create.

Politicians will only do so much. Wait for them and normally it's already too late by the time they take action.

It's up to the people to educate themselves and push for changes first. Then the governments follow, unless they are progressive. But unless they back up the policies they implement, it only goes as far as the big newspaper headline.

What is the point of telling the people to recycle if municipal workers just dump everything together or reprimand people who bring separated packages or paper and plastics to the municipal yard because it's giving them more work?

R&D is always good. The best R&D sometimes happens in the field. There is already technology in place. Time to use it and see how it functions in the field and improve on it. Small countries like M'sia don't have the type of resources that developed countries do. But they don't have to wait to implement good sustainable practices.
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PostPosted: Sat Jan 12, 2008 12:15 pm    Post subject: ARCHI./SUSTAINABLE DESIGN 3 :ENERGY/CONSERVATION Reply with quote

Posted: 28 January 2006 at 7:18am

Comments by gleearch

Here's an interesting read for those of you interested in finding new ways of generating energy beyond solar or wind.

Sustainability can mean new markets and profits to be made for those with a keen eye for emerging markets.

http://www.happynews.com/news/1272006/dairy-farmers-turning-manure-into-money.htm

MILWAUKEE

When dairy farmer Gary Boyke looks out at the manure his herd produces, he sees the prospect of profits rather than waste, odors and water pollution.

Boyke is one of a growing number of farmers turning animal waste into energy, and he's spreading the word to others. He will be among those giving presentations at a conference Jan. 31 in Madison on ways farmers can turn manure into money.

Boyke, who has 1,300 cows on his Vir-Clar Farm near Fond du Lac, said he gets two to three times the energy he needs with an anaerobic digester, which uses bacteria on manure to produce a gas containing methane to power generators.

He sells it to a Madison-based utility and then buys back what he needs. He said the device produces enough power for 330 homes.

''I think we're just on the verge of something that is going to be big in the future,'' he said.

A dozen such digesters are in operation in Wisconsin, five are under construction and 15 others are planned, said Larry Krom, business sector manager of the state Focus on Energy's renewable energy program.

About 110 digesters are working around the country, with another 70 planned, said Kurt Roos, manager of the U.S. Environmental Protection Agency's AgSTAR program. Most of them are at dairy farms in the Midwest, California, New York and Pennsylvania.

The average cost of a digester is nearly $1.5 million, and it takes about six years to earn back that original investment without any grants, said Krom, whose organization is one of the sponsors of the Madison conference.

A group of smaller dairy farms could bring manure to one central community digester to make it financially feasible for them, Krom said, or they could use a less expensive process in which methane is burned to produce heat rather than electricity.

There were 200 Wisconsin dairy herds with more than 500 cows in 2004, the latest year for which figures are available, compared with 140 in 2000, said Laura Mason of the Wisconsin Agricultural Statistics Service.

There's another benefit to digesters, too: Kenn Buelow, who operates Holsum Dairy at Hilbert and uses two of the digesters in his 3,100-cow operation, said the devices reduce odors from manure by 95 percent or more.

The conference also will discuss other uses for manure, including drying it to produce steam to power generators and create electricity; putting it in a pressurized chamber at high temperature to produce oil and a charcoal-like material, and _ for smaller dairy operations _ composting it and selling it to landscapers, gardeners and others, said Timm Johnson, executive director of the Wisconsin Agricultural Stewardship Initiative.

Tom Bauman, coordinator of the state Department of Natural Resources' agricultural runoff pollution program, said his agency is excited by any technologies that enable farmers to dispose of manure in an environmentally responsible manner.

''Ingenuity will enable us to solve pollution problems, promote economic growth and reduce our dependence on fossil fuels,'' said Rod Nilsestuen, secretary of the Wisconsin Department of Agriculture, Trade and Consumer Protection.

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Posted: 22 March 2006 at 3:27am

Comments by gleearch

It's been awhile but here are a couple of links that maybe of interest.

http://www.wbdg.org/design/greenroofs.php

INTRODUCTION

Green roofs, also known as vegetated roof covers or eco-roofs, are thin layers of living vegetation installed on top of conventional flat or sloping roofs. Green roofs protect conventional roof waterproofing systems while adding a wide range of ecological and aesthetic benefits. They are a powerful tool in combating the adverse impacts of land development and the loss of open space.

Green roofs are divided into two categories: 1) extensive green roofs, which are 6 inches or shallower and are frequently designed to satisfy specific engineering and performance goals, and 2) intensive green roofs, which may become quite deep and merge into more familiar on-structure plaza landscapes with promenades, lawn, large perennial plants, and trees. This guide addresses only the more shallow extensive green roofs.

The challenge in designing extensive green roofs is to replicate many of the benefits of green open space, while keeping them light and affordable. Thus, the new generation of green roofs relies on a marriage of the sciences of horticulture, waterproofing, and engineering.

The most common vegetated roof cover in temperate climates is a single un-irrigated 3- to 4-inch layer of lightweight growth media vegetated with succulent plants and herbs. In Germany, this simple design has demonstrated the highest benefit-to-cost ratio. In most climates, a properly designed 3-inch deep vegetated roof cover will provide a durable, low maintenance system that can realize the many benefits that green roofs have to offer.

DESCRIPTION

A. Features

All well-designed green roofs include subsystems responsible for:

Drainage: Green roof drainage design must both maintain optimum growing conditions in the growth medium and manage heavy rainfall without sustaining damage due to erosion or ponding of water
Plant nourishment and support: The engineered medium must meet exacting requirements for grain-size distribution, void ratio, moisture retention, etc. and

Protection of underlying waterproofing systems: Green roof assemblies must protect the underlying waterproofing system from human activities (including the impact of maintenance) and biological attack.
A wide range of methods can achieve these functions. For instance, drainage layers may consist of plastic sheets, fabric or synthetic mats, or granular mineral layers. Similarly, the physical properties and performance characteristics of growing media (engineered soils) and plant materials may vary with the climate, plant community, or engineering requirements. Figure 2 shows a generic cut-away of a common type of green roof assembly that utilizes a lower granular drainage layer in combination with an upper growth medium or substrate.

The selection of a particular approach may depend on performance-related considerations, such as runoff control, drought-tolerance, biodiversity, appearance or accessibility to the public. While many pre-engineered systems are currently available, it is frequently necessary to customize these systems to satisfy specific performance objectives.

B. Ancillary Features

1. Waterproofing

Many premium waterproofing materials have a proven track record when used in combination with green roof installations. These include, but are not limited to polyvinyl chloride (PVC), thermal polyolefin, EPDM rubber, polymer modified bituminous sheet membranes (e.g., SBS membrane), liquid-applied rubberized-asphalt, and coal tar pitch. Other materials are likely to enter the industry as their suitability is proven in certification testing and prototype installations.

Worldwide, polymer modified bituminous membranes and PVCs are the most common. Many of these installations have now been in place for over 30 years and continue to perform as designed.

In all instances, materials, methods of installation, and quality assurance procedures must be more stringent when green roof installation is involved. Waterproofing material that cannot withstand decades of root and biological attack unaided must be protected with a supplemental root-barrier layer. For information and standards pertaining to waterproofing materials, consult the National Roofing Contractors Association (NRCA) or American Standard Testing Methods (ASTM).

2. Pitched Roof Installations

To install extensive vegetated roof covers on pitches steeper than 2.5:12 (12 degrees) supplemental measures will be required to prevent sliding instability. Varied building systems have been developed to support vegetated covers on steeply pitched roofs. Pitched roof systems merge into vertical fa�ade greening techniques.

3. Wind Resistance Systems

Due to the unique physics of the green roof profile, attaching the elements of the green roof to the underlying structure is not usually important. The biomass bonds with the fabrics to create a unified cover, and the plants themselves create enough surface wind turbulence to foil potential uplift�the converse of an airfoil. If the green roof will be located in an unusually-high wind area, such as a high-rise building or a coastal region, appropriate ballasts should be specified. Guidelines for ballast requirements are available from European green roof providers.

4. Modular Systems

Modular systems involve installing the green roof system inside plastic trays. Use of these systems does not relieve the designer from responsibility for considering the integrity of the underlying waterproofing system, nor does it make location of damaged waterproofing easier. However, these systems can be useful when designing small gardens on residential property or terraced commercial roofs. They also preserve flexibility to re-arrange landscape designs in the future. Owners who wish to engage in active gardening will find modules a convenient way to do this without damage to their homes' waterproofing. Two companies in North America currently offer modular, or tray, components, GreenTech and Weston/ABC Supply.

5. Electric Leak Detection

Inexpensive methods for locating damaged waterproofing underneath vegetated covers are available. These include the electric field vector mapping (EFVM) procedure. This method works by charging the moist media layer of the green roof with electricity and then looking for electrical grounds caused by moisture in contact with an underlying steel or concrete deck structure.

C. Benefits

There are many potential benefits associated with green roofs. These include:

Controlling storm water runoff
Improving water quality
Mitigating urban heat-island effects
Prolonging the service life of roofing materials
Conserving energy
Reducing sound reflection and transmission
Creating wildlife habitat, and
Improving the aesthetic environment in both work and home settings.
As a result green roofs may be appropriate as an addition to many types of buildings, including commercial, industrial, institutional, and residential settings.

1. Controlling Storm Water Runoff

The rapid runoff of storm water from paved areas and roofs contributes to destructive flooding, erosion, pollution, and habitat destruction. The capacity of green roofs to moderate this runoff through both retention (water holding) and detention (flow-slowing) properties has been well-documented in Europe and increasingly in the United States. Green roofs share many engineering features with conventional storm water management basins, and compared to many at-grade storm water management practices, vegetated roof covers are unobtrusive, low maintenance, and reliable. Green roofs may offer the only practical "at-source" technique for controlling runoff in areas that already are highly urbanized.

Vegetated roof covers are particularly effective at controlling runoff on the large roofs typical of commercial and institutional buildings. They can be designed to achieve specified levels of storm water runoff control, including reductions in both total annual runoff volume (reductions of 50 to 60 percent are common) and peak runoff rates for storms.

Reliable techniques for predicting the rate and quantity of runoff from vegetated roof covers have been used successfully to design integrated storm water management measures in Germany, where large zero-discharge developments that rely heavily on green roofs are already operating. For example, the Bondorf transportation center in Sindelfingen achieves net zero storm water runoff discharge, largely through the use of 516,000 square feet (11.8 acres) of green roofs.

2. Improving Water Quality

By reducing both the volume and the rate of storm water runoff, green roofs benefit cities with combined sewer overflow (CSO) impacts. In cities with combined storm and waste water sewer systems, storm water dilutes the sanitary waste water, rendering treatment less efficient. During heavy rainfalls these systems also overflow, discharging raw sewage mixed with runoff into the receiving streams-resulting in ecological damage and human health hazards. Therefore, important water quality benefits are achieved by controlling runoff.

In addition, in urban areas, up to 30% of total nitrogen and total phosphorus released into receiving streams is derived from dust that accumulates on rooftops. Acting as natural bio-filtration devices, green roofs reduce this water contamination. In the Potsdamer Platz district of Berlin, extensive green roofs have been employed on a large scale in an effort to reduce pollution of the River Spree. This program has demonstrated that extensive green roofs can achieve large reductions in nutrient releases from roofs; however, the research also shows that the correct choices of growing medium and plant types are essential for success.

3. Mitigating Urban Heat-Island Effects

Covering dark conventional roofs with green roofs can significantly reduce the temperature above the roof. Green roofs have been shown to out-perform white or reflective roof surfaces in reducing the ambient air temperature. If sufficient urban surfaces are covered, this cooling (and attendant improvement of air quality) can have significant positive effects on human health, especially for the young and elderly in congested urban areas.

4. Prolonging the Service Life of Roofing Materials

Thirty-five years of experience with green roofs in Germany have demonstrated their value in protecting waterproofing materials. The multiple layers of the green roof protect the underlying roof materials from the elements in three ways: by protecting from mechanical damage (mostly from humans, but also from wind-blown dust and debris, and animals); by shielding from ultraviolet radiation; and by buffering temperature extremes, minimizing damage from the daily expansion and contraction of the roof materials.

A roof assembly that is covered with a green roof can be expected to outlast a comparable roof without a green roof by a factor of at least two, and often three. Although modern green roof systems have not yet been in place longer than 35 years, many researchers expect that these installations will last 50 years and longer before they require significant repair or replacement. For a building owner with a long-term investment in the roofing system, this benefit factor goes a long way toward paying back the initial investment in a green roof.

5. Conserving Energy

Not all benefits will be equally important in every project or climate. For instance, the capacity of green roofs to reduce heat flow, and therefore energy demand in buildings, is mostly a warm season phenomenon. As a result, this benefit will be realized most fully in warm climates, where energy expenditures on air conditioning are an important concern. Energy-related benefits will also be less important in multi-story buildings, due to the low ratio of roof area to the total of exposed building skin. Because green roofs are more complex than simple insulators, project-specific building envelope analysis is required to predict energy conservation under specific project conditions.

. Reducing Sound Reflection and Transmission

Green roofs can absorb a portion of the sound that otherwise bounces off hard roofing surfaces At the Frankfurt International Airport, green roofs were employed successfully as a means of sound abatement along new runway approaches. A simple 3-inch deep vegetative cover can be expected to reduce sound transmission by a minimum of 5 decibels. Sound abatement of up to 46 decibels has been measured on thicker roofs.

7. Creating Wildlife Habitat

Green roofs can be used to create wildlife habitats to supplement or replace diminishing open space in developing areas. With thoughtful planting and avoiding pesticides, a mature, self-sustaining ecosystem will teem with insects, spiders, snails, and songbirds. Using native species can recreate lost prairies, as at the Oaklyn Branch Library in Indiana.

8. Improving the Aesthetic Environment

Green roofs offer interesting new opportunities for architectural design. A green roof can allow a structure to merge with the surrounding landscape, provide a dramatic accent, or reinforce the defining aspects of the structure's geometry. In Germany�and increasingly in the United States�green roofs are frequently integrated into the design of hospitals and care facilities in order to provide a more restful and restorative environment for patients. Similarly, multi-unit residences and hotels will find that green roof-tops views substantially enhance property values. In commercial settings, job satisfaction and effectiveness can be enhanced by providing window views of meadows or flower beds or relaxing garden areas for breaks or meetings.

APPLICATIONS

A. Design Factors

There are many interactive factors that green roof designer must take into account, balancing many considerations for optimal performance in each setting, including:

Climate, especially temperature and rainfall patterns
Strength of the supporting structure
Size, slope, height, and directional orientation of the roof
Type of underlying waterproofing
Drainage elements, such as drains, scuppers, buried conduits, and drain sheets
Accessibility and intended use
Visibility, compatibility with architecture, and owner's aesthetic preferences
Fit with other "green" systems, such as solar panels
Cost of materials and labor
B. Integration With Other Green Design

Green roofs can be designed in conjunction with solar panels and also work very well in combination with other 'low-impact' development measures, such as infiltration beds, rain gardens, bioretention systems, cisterns and rain barrels. It is common place in Germany to find large developments that have zero runoff discharge. In these developments, rainfall is captured on the green roofs, returned to ground water through infiltration, and re-used for irrigation, toilet flushing, etc.

C. Examples of Extensive Green Roofs in North America

Thirty-five years of German experience and research indicates that extensive green roofs will succeed in most climates, if properly designed. With appropriate plant selection, sufficient drainage, and adequate structural support for the additional dead weight, green roofs will survive winter ice build-up. However, buildings in arid (desert) zones may not be good candidates for extensive green roofs, due to the difficulties and expense of water distribution and retention.

In North America, examples of extensive green roof projects are present in most climate zones, including New England, Mid-Atlantic, Gulf Coast, Midwest, Pacific Northwest, and Southern California regions. Ten or fifteen of these were built prior to 2002, and can be expected to have reached maturity by spring of 2003.

Because the few North American roofs that have been built to date demonstrate such a wide variety of settings and approaches, it is impossible to highlight "representative" case studies here. However, many updated case studies of green roof projects, including both extensive and intensive designs, are available at Greenroofs.com.

RELEVANT CODES AND STANDARDS

In the United States, green roof designs are generally regulated using existing standards for ballasted roofs. The International Code Council (ICC) code, formerly the BOCA code, used for guidance by many municipal authorities, recognizes roof gardens. It requires that the 'wet weight' of the green roof be treated as an additional dead load. It also supplies live load requirements for maintenance-related foot traffic and for regulated pedestrian access. One limitation of the ICC standards is that it does not specify the testing methods to be used in satisfying the code. ICC also provides standards for parapet heights and requirements for railings.

Trade organizations such as National Roofing Contractors Association (NRCA) are developing guidelines for waterproofing with green roof installations in mind. In addition, American Standard Testing Methods (ASTM), through the Green Roof Task Group E06.71, is in the process of developing guidelines and testing procedures specifically for green roof products.

However, at present, the only accepted guidelines for green roof construction are those developed by Forschungsgesellschaft Landschaftentwicklung Landschaftsbau. e.V. (FLL), in Germany (Guidelines for Planning, Installation, and Maintenance of Green Roofs, Richtlienien f�r die Plannung, Ausf�hrung und Pflege von Dachbegr�nungen, Forschungsgesellschaft Landschaftentwicklung Landschaftsbau. e.V.). These standards and guidelines are comprehensive, and include industry standard tests for medium weight, moisture, nutrient content, grain-size distribution, etc. The 1995 edition of the guide is available in English. The English translation can be purchased directly from FLL or through Roofscapes, Inc.. FLL also certifies laboratories to conduct critical tests such as the root penetration resistance of waterproofing membranes. Many green roof products available in the United States have FLL certification.

http://www.greenroofs.com/

By Jeff Sorrill, Project Manager
All Photos Courtesy The Green Roof Centre

The Green Roof Centre is a new venture undertaken by the University of Sheffield and Groundwork Sheffield, an environmental trust. The Centre was borne out of the fact that the UK is lagging behind many other part of the world, especially the US and Scandinavia, in its applications of green roofs.

The Greenest City in the UK

Based in Sheffield, South Yorkshire, the Green Roof Centre�s primary remit is to engage and inform construction professionals of the possibilities and benefits of green roofs. The centre is in the process of establishing an extensive demonstration site where architects, planners and designers alike can experience and understand the opportunities green roofs offer

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We are currently designing a small restroom facility that is buried in an earthen berm. The berm helps to moderate the temperature of the building. At the same time, we are incorporating a "green" roof on it. Basically a green roof is one where you can grow plants on. It tends to help minimize solar heat gain, has good insulating capabilities and prolongs the life of the roof (double in some cases). In our case, we want the building to blend in with the surrounding landscape.

And done right can look really good on modern buildings.

As the examples below show. There's actually a cool suspended green roof on a sports stadium in France. I'll post that link when i find it again.
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http://www.worldchanging.com/archives/003738.html

The Week in Green Design (11/12/05): Green Roofs
Jill Fehrenbacher and Sarah Rich - November 13, 2005 11:48 AM

Jill Fehrenbacher and Sarah Rich write about the ongoing evolution of sustainable design at Inhabitat.

American cities have a surprising amount of wasted open space. Even in densely packed urban areas like New York City, the prime real estate atop roofs is given much less consideration than one would expect from a populace that values each square foot of space so highly. This oversight is a real shame, because there is so much that can be done to improve the local environment and quality of life, simply by fixing up a roof.

The average city rooftop is layered with black tar, a material which traps sunlight and heat, raising the temperature of the surrounding area. The heat trapped by dark, flat roofs elevates city temperatures as much as ten degrees Fahrenheit - contributing to what scientists call the "urban heat island" effect.

So what can we do about it? Read on.

Cool Roofs

The easiest and quickest solution to combat the urban heat effect is simply to turn hot dark roofs into "cool roofs" by painting them with a basic coating of light-colored water sealant. In the same way that white clothing helps keep you cool in the summertime, white roofs reflect sunlight and heat. If all the roofs in New York City were "cool roofs", the city would save some $100 million dollars per year in cooling costs.

Green Roofs

An even better alternative to cool roofs (albeit one that requires more time and effort) is to turn waste roofs into landscaped Green Roofs. Green roofs having the same cooling effect of white roofs, with the added benefits of:

Providing amenity space for building users � replacing a yard or patio
Increasing roof life span
Reducing storm water run off
Providing noise insulation
Filtering pollutants and CO2 out of the air
Providing locally grown food (with roof-top vegetable gardens)
Increasing wildlife habitat in built up areas
Reducing heating (by adding mass and thermal resistance value) and cooling (by evaporative cooling) loads on a building
Reducing the urban heat island effect

Cost & city planning
Green roofs add so many benefits to a building and its surrounding area, it�s astonishing that more roofs aren't green at this point. The biggest roadblock to our green roof future seems to be cost and bureaucratic red tape of city planning laws. Although green roofs cost more up front to install than regular roofs, the savings that they accrue over the years quickly pay off. The biggest hurdle to getting green roofs going in more places, is convincing getting city governments to change their policies and adopt programs which provide incentives to property owners to renovate their roofs.

In this endeavor, the city of Chicago is leading the way. Chicago's Department of Environment is actually giving away $5,000 grants to any building owners who want to start a green roof project. So if you are a lucky homeowner living in Chicago, you have no excuse for not making your rooftop green!

Meanwhile I'm waiting for New York City to wake up and get on the ball with this. If only this photograph were more than just an "artist representation"

Aesthetics
Frustratingly, another hurdle to green roof world-domination is the fact that ever since the "back-to-the-earth" straw bale movement of the seventies, green roofs have been associated with a sloppy, crunchy aesthetic. This is an unfair and unfortunate connotation, since green roofs can be as clean, modern, and integral to "good" architecture as glass and steel. Peter Zumthor's green roofs on the Val Thermal Baths in Switzerland are just one example of a stunning use of green roofing in contemporary architectural design.

Others include Renzo Piano's proposed redesign of the California Academy of Science in San Francisco. Piano's green roof design features mounds and valleys of various heights and sizes, creating pockets of shade and opening vistas into the surrounding Golden Gate Park.

The largest "living roof" in the world was designed by environmental architect William Mcdonough, and sits on top of the the Ford Motor Company's Rouge Manufacturing Plant in Dearborn, Michigan. Other notable green roofs include the international airport in Amsterdam, and the sloped green roofs of the Palais Omnisports in Paris-Bercy.

For more information on Green Roofs check out:

http://jscms.jrn.columbia.edu/cns/2005-03-01/schwartzs-greenroofs
http://www.gothamgazette.com/article/environment/20051028/7/1635
http://www.greenroofs.com/
http://en.wikipedia.org/wiki/Green_roof
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Posted: 23 March 2006 at 5:15pm

Nik Zafri's Response

Impressive...it even protects the conventional roof waterproofing systems!
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Posted: 23 March 2006 at 7:24pm

Nik Zafri's Comments

Gerard

I found something that you'll definitely like!

http://www.ptm.org.my

and as reported in The Sun today :


Solar energy comes with a price
Maria J. Dass

SUBANG JAYA: Solar energy, whether in the form of light or heat, may be free but getting electricity out of it will come at a price.
In several remote parts of the world where infrastructure is scarce, including villages in the country, electricity is obtained from solar energy, which has long been promoted as a clean, efficient and renewable source of power for all Malaysians.

However, middle and lower income households in Malaysia may only be able to afford such photovoltaic (PV) technology in their homes in about 10 years.

This is because the government plans to promote this technology among the high income group in urban areas first.

Ahmad Hadri Haris, who heads the Malaysian Building Integrated Photovoltaic (MBIPV) national project, said efforts to drive the growth of BIPV will be focused on urban areas - which are grid connected - and will be private sector and investment driven.

"Right now the cost of BIPV is high. That's why we are targetting the high income group, because that's where the market and customers with buying power are," he said at the BIPV seminar, "What's in it for me?" here on March 17, 2006.

"This way the government's investment is reduced and the people who can afford to install these panels for now will absorb the initial cost," said Ahmad Hadri.

"So when the demand increases and the market is developed, the cost will come down, making it affordable to other users, including those in rural areas," he added.

The seminar was organised by the Malaysia Energy Centre in collaboration with the Energy, Water and Communications Ministry, the United Nations Development Programme and the Global Environment Facility.

Currently, consumers may have to fork out RM150,000 to RM300,000 to install a BIPV system in their homes.

"The idea is to build up a sort of branding, niche market and appeal for the product among the high income group and those in the upper middle class.

"This, we hope will trickle down to the other groups in the lower rungs of the social strata when the cost comes down eventually," said Ahmad Hadri.

"We hope that owning solar panels will become something of a statement of being cool, fashionable, and a sign of environmental awareness and high technology," he said.

"New high-end housing projects will also soon offer the option of installing these solar panels.

"This can be accommodated, with perhaps an option for housebuyers to incorporate the costs into their loans," he added.

To promote the use of solar energy, the Malaysia Energy Centre plans to offer the public incentives for installing a BIPV system in their homes.

Currently, only companies are entitled to such incentives.

Industry observers have pointed out that the success in encouraging the public to use BIPV in other countries was fueled by tax incentives given by the government to those who adopted the technology.

The centre will also be launching a National Suria 1000 programme,

The programme will aim to encourage BIPV installation in residential and commercial buildings before the end of this year.

PV application in Malaysia started in the 1980s to generate power for communication towers, oil and gas facilities, calculators and some rural systems.

Stand-alone PV systems are used by the Malaysian Nature Society in Endau Rompin, in Gunung Machinchang in Langkawi, parking ticket machines as well as emergency phones in certain stretches of some highways in the country.

The Ministry of Rural and Regional Development also has an ongoing rural electrification programme which involves the use of solar energy.

I'll be eagerly waiting your valuable counter comments on the URL and this news. Don't forget the 'greenroof' issue.

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As a matter of fact, I was thinking of how you can take business advantage out of this. Trust me..this thing is still SO NEW in Malaysia.
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Posted: 24 March 2006 at 12:28am

Response by gleearch

Nik,

Good link.

Interesting the push for PV. Didn't we discuss this a year ago? The merits anyway.

Hopefully when it comes to being intergrated into the building, it's not something that is just slapped onto the building but carefully designed into the building's form.

If they market this successfully, they will probably see a drop in installation prices sooner than they expect. PV technology is evolving as we speak and the prices are on a downward spiral. Which is great for both consumers and the environment.

I'll keep you updated on the green roof.

Crazy busy right now.
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Posted: 26 April 2006 at 11:35pm

Comments by gleearch

Some of you might find this interesting.

Recently there has been a push in some sectors for radaint floor cooling or hydronic cooling.

It's similar to radiant floor heating which has been around for awhile. In this case, radiant floor cooling is taking advantage of the pex tubing already in the floor for heating and it's now tied to a cooling condensing unit (as well as the boilder unit) .

For countries like Malaysia, there's no double dipping with the pex tubing because there's no need for heating. (except in the case of a building where they turn up the airconditioning and everyone is walking around with sweaters while it's 90 degrees Farenheit outside).

Another thing to watch for is condensation because of high humidity. Especially so in ASEAN countries. It has to be carefully calculated to avoid cooling below the dew point but as with radiant heating, people tend to feel cooler when the surfaces are cooler as opposed to the air. So you tend to not need to cool as much. So less use of energy. (refer to the US$60 a barrel post which is now over US $70)

There is a lot of info on the web and I'm providing a link to a mechanical engineering firms description of a building system they worked on. I thought it was well written and provides good basic information about radiant floor cooling.

http://www.glumac.com/section.asp?catid=140&subid=152&pageid=402

Architects Say �Yes!� to Radiant Heating & Cooling

A person feels too hot or cold if their body�s heat loss is less or greater than the heat generated by their body while performing activities. We are comfortable when heat loss is equal the heat generated by the body (thermal equilibrium).

The body loses heat in several ways. Radiation to surrounding surfaces (e.g. walls, glazing) accounts for about 45% of the total heat loss from a person performing typical indoor activities. 35% is lost through convection to the air, and 20% through evaporation (e.g. breathing, sweating).

Typical heating and air conditioning systems only control air temperature, which works well for most situations. Very tall spaces, such as atria, can be challenging to control due to stratification (hot air supplied to these spaces rises to the top, rather than staying in the occupied zone), particularly in the winter. Spaces with large amounts of glazing present an additional challenge. The glass surface temperature varies with the outdoor conditions, and radiation between the occupants and the glass can be difficult to offset by controlling air temperature alone.

Radiant heating and cooling systems have been successfully applied to many different types of buildings and can effectively condition tall spaces and areas with glazing. By controlling the surrounding surface temperatures, radiant floors, ceilings, or even walls can handle the largest component of a person�s heat loss and comfort.

Save Energy While Increasing Comfort

In typical heating and air conditioning systems, the air temperature is set to compensate for radiant losses. For example, in a space with full-height glass on a sunny day, the occupants may be uncomfortable from such a large hot surface unless the air temperature is reduced to keep them cool. If the surface is hot enough, reducing the air temperature may not be able to keep them comfortable, no matter how cool it is. More energy is needed to maintain the lower air temperatures, and the difference between the air temperature and glass surface temperature may be uncomfortable to the occupants.

Radiant floors provide some control of the radiant heat loss from building occupants and can offset the radiant heat transfer from glass. The improved control of the radiant portion of the heat transfer equation, allows the air temperature to be set warmer while still maintaining comfort and efficiency. The result is energy savings and increased comfort.

During winter operation, the same reasoning applies to achieve improved energy and comfort. Additionally, radiant floor heating addresses the stratification that occurs with many air systems, allowing further improvements in energy and comfort.

An Architectural and Engineering Landmark: Seamlessly Integrating Radiant Floors for the Eugene Courthouse

The new Wayne L. Morse Courthouse in Eugene, Oregon, is set to become an architectural landmark, collecting awards even before construction has begun. The project is one of thirteen projects to receive a 2004 �Progressive Architecture� design award from Architecture magazine. The sweeping curved metal and glass fa�ades will make a significant contribution to the architectural significance of the the town of Eugene.

Visitors to the courthouse will notice the spectacular views, but they may not realize that what they cannot see is very progressive. Below the floor will be a radiant heating and cooling system, designed to save energy, increase comfort, and seamlessly integrate with the architecture of the building.

The radiant system for the courthouse consists of PEX tubes encased in a concrete floor slab. The tubing distributes heating water or chilled water from the central boiler and chiller plants through the floor slab. The radiant floors condition the atrium, public corridors, and jury assembly area, all of which contain high ceilings and extensive areas of glazing.

This type of floor system in a heating application has been used for decades in the U.S. and has been proven to be a reliable, cost-effective means of heating. By using the same system for cooling, the design is taking a departure from standard engineering practice and venturing into new territory. In order to calculate the floor cooling capacity, Glumac collaborated with the radiant floor manufacturer to perform a finite-element analysis of the floor at various conditions.

The historical concern with radiant floor cooling has been condensation on the floor. Space humidity sensors and floor slab temperature sensors are employed to prevent condensation and ensure comfortable operation. The system design and control sequences developed by Glumac, incorporate the current state-of-the-art thinking on radiant floor cooling and lessons learned from previous radiant cooling projects

Architectural Integration: Floor Construction

When designing a radiant floor system, care must be taken to ensure that the heat transfer is directed up, to the conditioned space, rather than down, wasted to the space below. This is achieved by insulating underneath the radiant floor and by not insulating on top of the floor. In the Wayne L. Morse Courthouse, the insulation under the floor was already part of the architectural design to maintain the floor level with adjacent spaces. An underfloor air distribution system is used throughout the building, except in the public spaces in which the architect desired a tile floor. The tile floor is raised on a rigid foam and concrete topping slab construction in order to maintain a consistent finished floor level throughout the building. The tile floor covering provides very little thermal resistance to the heat transfer between the tubing and space, and the foam underneath prevents energy waste below. The arrangement is ideal for the radiant floor, at no added cost to the project.

Air Distribution

A supplemental air system provides ventilation air and a portion of the cooling capacity for these public spaces. The air system is as integrated into the architectural design. The air is delivered through the wall stud cavities to hidden grilles at the bottom of the walls. The air is supplied at a low level and low velocity, a classic displacement ventilation system. The air distribution capabilities and noise level produced by the system were tested during the design phase.

The air system with a radiant floor is smaller than that without the radiant floor. The reduced shaft sizes and duct distribution benefit the architecture of the building.
-----------------------------------

There are other resources about this and I will provide more info as time goes by and the technology matures.

Nik,

I haven't forgotten just been tied up.
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Posted: 18 May 2006 at 1:52pm
Nik Zafri's Comments

Check this out!!

http://www.ciria.org/buildinggreener
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Posted: 19 May 2006 at 12:00am

Response by gleearch

Nik,

Good link. As can be seen, the momentum towards creating greener buildings is gathering up steam. It really is in the interest of developing nations to get on now instead of following developed nations. No point having them point fingers and accussing developing countries of damaging the environment and being responsible for global warming trends.

At the moment, I'm helping another firm review and critique their project. A fairly decent size condo hotel. Busy as usual.
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Comments by gleearch

Here's an interesting article. Albeit, it's a little old but they are progressing on it.

http://www.local.org/independ.html

In Spring, 2007, the San Francisco Board of Supervisors will vote on a plan to build the world's largest municipal solar power public works project.

The plan follows over two years of work by Local Power joined by Sierra Club, Greenpeace USA, Our City and a coalition of San Francisco community groups, after the San Francisco Board of Supervisors unanimously approved an ordinance on May 11, 2004. The Community Choice (CCA) Implementation Plan follows a state law allowing California cities and counties to switch residents and businesses to a new power supplier for electricity service - and to finance a network of renewable energy and energy conservation projects that will dramatically reduce the communtiy's dependency on natural gas and nuclear power plants.

The move, sponsored by Supervisor Tom Ammiano, follows a California Public Utilities Commission decision to make room for communities like San Francisco to break away from utility power contracts to control their own energy destiny under California's Community Choice law (AB117, Migden), and answers a 2001 voter mandate for green power from San Francisco�s 2001 Solar Bond Authority, Proposition H.

Electricity is the nation's largest single cause of greenhouse gas pollution, and causes one quarter of San Francisco's emissions. Millions of Americans receive energy via Community Choice laws passed in Massachusetts, Ohio, and New Jersey and Rhode Island in recent years, and one aggregation involving over half a million customers has already achieved a 33% greenhouse gas reduction in its electricity without a rate increase. Over a dozen cities representing three million residents - and over ten percent of California's investor-owned utility market - are now actively seeking to implement the new law with at least 40% green power in their mix - twice the level required by state law.

The Energy Independence ordinance directed City departments to prepare an Implementation Plan and Request for Proposals for the Board of Supervisors to solicit new Electric Service Providers interested in supplying power to San Franciscans, and building 360 Megawatts of new solar photovoltaic installations, distributed generation such as fuel cells, wind turbines, hydrogen, energy efficiency, and conservation technologies as standard components of the City�s electricity service. The City Controller�'s office has agreed to assist in developing the analysis necessary to develop the draft implementation plan. Under Community Choice, power would be �wheeled� over PG&E�s lines. Ratepayers would also have the option to opt-out and remain with PG&E as their power supplier.

The conversion, say proponents, would protect residents and businesses against increasingly volatile natural gas prices, assist in closing power plants that cause breast cancer and childhood asthma, and make the City a leader in the global effort to stop climate change. On an average day, San Francisco requires 650 Megawatts of power at night and 850 Megawatts during the day. A 360 Megawatt investment in green power � as called for in the City�s adopted Electricity Resource Plan � will far exceed the Renewable Portfolio Standard called for by state law.

Community Choice law enables power providers to mix solar with less expensive resources such as energy efficiency technologies, bringing down the average price of the City�s portfolio of resources to be competitive with PG&E�s electric bills. �What is more, after it is paid off, this infrastructure will continue to provide power to San Franciscans at considerably lower rates for decades,� said Paul Fenn of Oakland-based Local Power, who authored the Community Choice law (AB117, sponsored Assemblyperson Carole Migden, 2002) and assisted Ammiano�s office in drafting both the 2001 �H Bond Authority� and the Energy Independence Ordinance. �Energy independence offers San Franciscans permanent protection against future energy crises, and hard savings that cannot be taken away.�

Supervisor Ammiano sponsored the successful H Bond Authority for renewable energy and conservation projects in 2001. Proposition H, coupled with the proposed ordinance, will allow the City to finance the green power projects, allowing for a more gradual repayment of the solar, wind, conservation and efficiency investments without a rate increase.

�This ordinance will offer a kind of insurance against wildly fluctuating energy prices and permanently reduce the amount of power San Franciscans need to buy from the grid,� said Ammiano. �We can work towards closing the City�s polluting power plants and make the City comply with the Kyoto Treaty, all at the same rates PG&E charges - now I call that a bargain.�

Supervisor Ammiano announced his �Energy Independence Ordinance� on February 17 flanked by Local Power Founder & Director Paul Fenn (local.org), S.F. Dept of the Environment Director Jared Blumenfeld, Sierra Club Int�l Vice President Michele Perrault, California Wind Credit Law architect Tyrone Cashman, Sacramento Solar Architect Donald Aitken, Community First Coalition President Maurice Campbell, UC Berkeley Professor Daniel Kammen, Greenpeace USA and TURN at a City Hall press conference today.

Founder and Director of Local Power, Paul Fenn authored San Francisco's Energy Independence Ordinance (Ammiano). Fenn is also author of California's Community Choice law, AB117 or Chapter 838 of 2002 (Migden), which allows municipalities to switch their communities to alternative energy providers - as well as author of San Francisco's 2001 voter-approved "Solar Bond" or "H Bond" authority (Ammiano). Mr. Fenn has also authored of state "Solar Networking" legislation, Senate 697, sponsored by Pomona Senator Nell Soto. Local Power is based in Oakland, California and may be found at www.local.org

-----------------------------
With utility companies and oil companies having such a tight control on prices, it's interesting to note that a few cities are trying to minimize their reliance on these big utilities and moving towards providing alternative and renewable energy.
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nikzafri



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PostPosted: Sat Jan 12, 2008 12:17 pm    Post subject: Reply with quote

The Star Global Malaysian Forum-Posted: 29 May 2007 at 11:24am

Comments by ahvincent

This is how things normally work in Australia. In the very begining the Owner engages the Consultant. The Consultant does the design and when the owner is happy with the design, they call in the Quantity survey for a cost to build. If the cost is too high then the owner will ask the Consultation to redesign the project. Then it goes to the QS again until they can come back with a acceptable cost within the owners budget.

Then the owner tenders the project to a builder / contractor. It is up to the builder to satisfy himself as to whether he can build the project at the budget that he has been given. At this point the Consultant's work/obligations to the Owner is finished. He is then novated or his contract assigned to the builder. From this point onwards he is on the Builders "payroll" to do his construction phase obligations like modifications, changes, inspections and certification.

During the entire phase of the project the owner is protected by the contracts that he has signed with the Builder & the Consultant. If there are any faults in the project the owner can sue both the Builder & the Consultant. Hence all owners make very very sure that the contracts are well written and the other parties are adequately insured with a reputable Insurance Company.

For the Builders & Consultants, they make very very sure that the project is well built and all inspections are carefully carried out because they know they will be or can be sued for faulty workmanship or if the project is not fit for it's intended purpose.

So most projects are designed and built with few probelms because the legal liabilities of all parties are clearly defined. As to rising prices of building material it is really up to the parties entering into the contracts. They can either have a price variation clause to allow for it or a fixed price lump sum contract. From my experience the case in Oz seems to slightly favour the fixed price approach.

Whether an Owner will allow a big allowance just in case building cost goes up is up to the Owner. What if the cost goes down? Do they get their money back? If they do, then might as well enter into a price variation arrangement.

Most Owners will choose to enter into fix price contracts and allow a small amount for the Builder to go into the futures market and protect themselves that way against possible rising costs. That's what the futures market is all about, managing future uncertainties in commodity prices but unfortunately most people think of it as a big casino.
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Nik Zafri's Response

Posted: 29 May 2007 at 9:08pm

If you go by the book, the processes that ahvincent mentioned is indeed the right way to do things - by understanding the following clause alone :

ahvincent wrote:
So most projects are designed and built with few problems because the legal liabilities of all parties are clearly defined.


is more than enough.

Actually as I said earlier, the 'by the book' good practices still exist in Malaysia - the procedures are very much the same like ahvincent has clearly put in his last post (at least I still see these practices in many projects) with exceptional to a bunch of 'jokers' doing construction without proper experience/backgrounds (hmmmm doesn't that sounded a bit 'political')
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Response by ex_kl_gal (Posted: 30 May 2007 at 1:16am) and ahvincent (in bold) (30 May 2007 at 7:04am)

ahvincent,

Is this scenerio you described practised for public or private projects, or both?Are the public projects usually competitively bid ( based on BQs) or are they negotiated ? The scenerio is pretty much the same both for private & public sectors. For public sector works the basic rule is for it to go to tender. Usually it is based on the best price but not necessary so. There is also a in the Public sector rule that no single company (or related entity) can get more than a certain percentage of work. Companies that missed out can ask for a reason why they missed out and if they have sufficient cause appeal to the ombudsman to have the project re-tendered.

If, upon the award of the project to the main contractor, the consultants pass on to the contractors payroll, who prepares/negotiates Variation Orders on behalf of the Owner? Usually the Owner will appoint a Project Manager who is paid by the Owner to manage the project and the contractors and consultants. The Owners might be a big Superannuation trust and they will not have the nrcessary expertise, so they will have to rely on a Project Manager to keep an eye on the monkeys. Project Managers usually get a "bonus" if the project comes in under budget.

Here, all public works projects have to be competitively bid and the public works entity/owner is mandated to accept the lowest bid ( unless it involves massive mobilisation and logistical problems and you're Haliburton/Parsons/Bechtel and can in theory handle such immediate work -read Iraq reconstruction). Haliburton is a mongrel. Very unhappy with their ethics and payment schedules.

The problem with this ( accepting the lowest bid sans BQ) is that many large contractors who shall remain nameless low ball their bids..get awarded the project and make their $$$ in Change Orders/Claims. In Oz we usually don't have this problem. Trying to get variations from Project Managers is like extracting teeth. Don't forget their bonuses is directly linked to the budget. For Public projects the Auditor Generals Department gets their finger in the pie as well. Cost over-runs will attract the Government auditors like flies to rubbish and their findings are made public and many a minister has to resign or lose their portfolio because of poor cost management and if there is the slightest smell of improper behaviour a jail sentence is very likely.

The contractual liabilities are pretty well defined here too but if you have a large amount of unpaid $ in either justified or unjustified claims , its worth a shot to litigate it. We have a "Security of Payments Act" which protects contractors and consultants against slow paying or non paying Owners/principals. Most litigation is over faulty work or defects. The standard defects liability period is six years, as per the Statute of Limitation but most astute Owners will ask for a Deed to be signed instead of an agreement. A deed has a life of 12 years. Also under our defects liability law, the six years start from the time the defect is first identified. So effectively, if you have a good manager you can squeeze a 18 years defects liability period warranty. This is very important because with some large projects latent defects (like concrete cancer) may not show up for years.
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Nik Zafri's Response

Posted: 30 May 2007 at 3:09pm

Now...we're going more serious and serious (I love it)....project management, contract administration and laws...(wah no more room for me to speak on quality management)

In simple words, the nature of how the project is implemented - PFI, Design and Build, Turnkey, Conventional etc. would determine the contract requirements. Of course, generally speaking, despite there would be some variations and generic clauses to define the overall processes like Pre to Post Tender, Estimation/Costing, Adjudication, Pre to Post Contract, Design/Development, Planning, Pre to Post Construction, Monitoring/Supervision, Arbitrative etc, (blah-blah-blah) but you will definitely still see that the overall construction processes are still very much the same. The main differences can only be seen on the level of responsibilities, authorities and liabilities/onus - on all parties. I think that's what ahvincent meant - literally speaking.

But that's not why I'm here for.

ahvincent wrote:

We have a "Security of Payments Act" which protects contractors and consultants against slow paying or non paying Owners/principals. Most litigation is over faulty work or defects. The standard defects liability period is six years, as per the Statute of Limitation but most astute Owners will ask for a Deed to be signed instead of an agreement. A deed has a life of 12 years. Also under our defects liability law, the six years start from the time the defect is first identified. So effectively, if you have a good manager you can squeeze a 18 years defects liability period warranty. This is very important because with some large projects latent defects (like concrete cancer) may not show up for years.


I'm only interested in this one especially. And I'm sure ex_kl_gal and ahvincent would like to have their say in this one.

In Malaysia, DFL is fixed but depending on what sort of project value and/or nature of project we're talking about (housing, lowrise, highrise, road/highway etc.- but I'm not going to touch on highways/roads coz they involve further deals like concessions, royalties not to mention some people getting richer & richer via 'toll plazas' etc.) - Hey..somehow I got a funny feeling that we've spoken about this - mann I'm too lazy to look into old threads.

The following is actually an excerpt from Treasury (Ministry of Finance) Circular (I'm also unsure if this circular is not superseded yet) - don't worry guys, it's not something of Official Secret Act: - It's marked by me FOR DISCUSSION PURPOSES ONLY. Smile


Security Deposit dan Retention Fund

Security 200A Before work commences on any works Deposit contract exceeding $25,000 in value, the for Works contractor shall be required to provide a Contract security deposit in the form of cash or an approved Banker's Guarantee equal to 5% of the contract sum. This deposit will be released upon satisfactory completion of the contract. For works contracts below $25,000 in value no security deposit is required.

Defects 200B Every works contract shall have a fixed Liability Defects Liability Period determined in accordance Period with T.I. 200D below. During this period the contractor shall make good any defect on the work performed. In the event that the contractor fails to make good any such defect during the said Defects Liability Period, the Department shall arrange for the defect to be made good .........................................??? (the rest of text could not be seen)

Retention 200C The Retention Fund is different from, and in Fund certain cases in addition to the Security Deposit. It is built up by retaining a certain percentage of all progress payments made to the contractor until the contract sum is reached. The amount outstanding in the Retention Fund is released after the expiry of the Defects Liability Period, or after all defects have been made good, whichever is the later.

Duration 200D The amount of Retention Fund and the of Defects length of the Defects Liability Period will in Liability each case be determined by the size and complexity Period and of the project as provided below:-

Amount of Retention

(i) For contracts below $10,000 in value Fund the Defects Liability Period shall be 3 months after the date of practical completion of the works; and the Retention Fund shall amount to 5% of the contract sum.

(ii) For contracts between $10,000 and $25,000 in value the Defects Liability Period shall be 6 months after the date of practical completion of the works; and the Retention Fund shall amount to 10% of the contract sum. Half of the balance outstanding in the Retention Fund shall be released on practical completion of the works and the other half on expiry of the Defects Liability Period.

(iii) For contracts between $25,000 and $1 million in value the Defects Liability Period shall be six months after the date of practical completion of the works; and the Retention Fund shall amount to 5% of the contract sum.

(iv) For contracts over $1 million in value the Defects Liability Period shall be 12 months after the date of practical completion; and the Retention Fund shall amount to 5% of the contract sum. The Retention Fund may be released to the contractor 6 months after the date of practical completion of the works provided that the contractor furnishes in its place the equivalent amount in the form of a Banker's Guarantee for the rest of the Defects Liability Period. This sub-section applies to large and sophisticated single project such as hospitals, multi-storied offices or highways.

(v) Where the contract sum exceeds $1 million merely by virtue of repetitive works e.g. a group of Government quarters, a military camp complex consisting of a number of repeated buildings, the Defects Liability Period may be shortened to 6 months and..............?? (the rest of text could not be seen)

--------------------------

The next following case was taken from Property Times

Redress through the Tribunal

The recent amendments to the Housing Development (Control & Licensing) Act, 1966 saw the inclusion of a new Part VI - Tribunal for Homebuyer Claims. This inclusion gave birth to the Tribunal for Homebuyers� Claim and it was implemented on Dec 1, 2002.

The Tribunal Regulations set out detailed but simple procedures for a homebuyer to file a claim against a developer. It provides a speedier avenue to aggrieved buyers to seek redress and justice instead of undergoing a costly and lengthy court process. In order to preserve uniformity of laws, the procedures are almost similar to that of the Consumer Claims Tribunal established under the Consumer Protection Act, 1999.

Homebuyers
A �homebuyer� is a purchaser who has bought a property or has dealing with a licensed housing developer. This also includes the second purchaser who purchased the property from the first purchaser under a sub-sale. The Tribunal will not hear claims brought by subsequent purchasers thereafter.

Commencement of proceedings
A homebuyer may lodge his claim with the Tribunal in the Form 1 together with the fee of RM10. He may claim for any loss suffered or any matter concerning his/her interests as a homebuyer against a developer under the Act.

Jurisdiction
The jurisdiction of the Tribunal shall be limited to a claim that is based on a �cause of action� arising from the sale and purchase agreement or a previous dealing entered into between the homebuyer and a licensed housing developer. It must be brought up by a homebuyer pursuant to Section 16N(2) of the Act in the following circumstances:

(a) Not later than 12 months from the date of issuance of the CF.
Example: John signed a sale and purchase agreement for a terrace house in 1997 and the developer was scheduled to complete the construction by 1999. The developer delayed but subsequently completed the construction and handed vacant possession to the buyer in the year 2001, yet there was no CF. After protracted delays, the CF was subsequently issued in November 2002. John is entitled to Liquidated Ascertained Damages until the year 2001 and may submit his claim to the Tribunal not later than November 2003.

(b) Not later than 12 months from the expiry date of the defects liability period.
As set out in the statutory sale and purchase agreement, the defect liability period is 18 months from the date of vacant possession. Accordingly, a homebuyer can lodge a claim at the Tribunal not later than the 30 months from the date of vacant possession that is, 18 months (defects liability period) plus 12 months (specified time frame).

(c) Where there exists a previous dealing between the homebuyer and the licensed housing developer in respect of intended acquisition of property.
Example: Ramli paid an upfront payment of RM5,000 for his intended purchase from a licensed housing developer. No sale and purchase agreement has been signed yet. However, a form for an option to purchase had been signed. Ramli, after making checks discovered that the title deed was not of freehold status contrary to what the developer�s sales staff said. Instead, the title was a 99-years leasehold with 69 years left. The Tribunal will deal with such claims although no sale and purchase agreement has been signed.

(d) The Tribunal only hears claims where the monetary amount does not exceed RM25,000 per cause of action. It is immaterial that the aggregate of all the individual claims exceed RM25,000. The following are some instances of �cause of action� arising from a sale and purchase agreement:
i. Compensation for late delivery;
ii. Damages for deviation of plans;
iii. Damages for defective workmanship;
iv. Compensation for adjustment in land area as compared to the measurements in the Agreement;
v. Omission of works;
vi. Refusing/neglecting to remedy defects, shrinkage or other faults to the building;
vii. Incomplete or non-availability of common facilities (in part or in whole)
viii. Loss or damages of a consequential nature.
Example: Lim has a claim for LAD of RM22,000; omission of works that the developer has failed to conform of a monetary claim of RM13,500 and a further claim of RM3,500 for remedial works. Each claim for �cause of action� is less than RM25,000 and is within the jurisdiction of the Tribunal to make award despite the fact that the combined claims is RM39,000.

(e) The Tribunal will hear only claims brought by homebuyers. A developer is not entitled to institute or file any claim in the Tribunal, but they can raise a counter-claim when responding to the claims filed by the home buyer. The Tribunal will still hear the counterclaim even if the home buyer�s original claim is later withdrawn or struck off.

Awards of the Tribunal
The Tribunal shall make its award without delay and, where practical within 60 days from the first day of the hearing before the Tribunal commences. An award of the Tribunal may consist of one or more of the following:
a) That a party to the proceedings pay money to any other party;
b) That the price or other consideration paid by the homebuyer or any other person be refunded to the homebuyer or that person;
c) That interest be paid on any sum or monetary award at a rate not exceeding eight percent per annum, unless it has been otherwise agreed between the parties.

No legal representatives
No party shall be represented by a lawyer at a hearing unless in the opinion of the Tribunal the matter in question involves complex issues of the law. In the event, that one party is subsequently allowed to be represented by a lawyer then the other party shall also be so entitled.

Proceedings
All proceedings before the Tribunal are opened to the public.

Criminal penalty for failure to comply
Any person who fails to comply with an award made by the Tribunal commits an offence and shall on conviction be liable to a fine not exceeding RM5,000 or to imprisonment for a term not exceeding two years or to both.

Many home buyers usually have little knowledge of what to expect of the Tribunal. HBA is the process of producing a guidebook to assist claimants to be conversant with the mechanics of the filing a claim with the Tribunal for homebuyer claims. This book is intended as a step by step guide to first time claimants. Watch out for the announcement of the launching.

The National House Buyers Association is a non-profit, non-governmental, non-political organisation manned by volunteers. Our website is www.hba.org.my. E mail: [email protected]

- Property Times 29th March 2003 issue -

--------------------
I rest my case..knock..knock..
--------------------------------------

Posted: 31 May 2007 at 7:13am

Response by ahvincent

Nik

The Oz Security of Payments Act (SOPA) goes one step further than a security deposit. Security deposits are generally used to cover defects identified after practical completionand cannot be used to pay normal contractor bills during construction.

So, during the construction period if the Consultant cannot get paid, he then lodges a claim against the contractor and/or owner under SOPA. This frees up the courts and make the process much easier and strips off all the legal costs associated with court cases.

However, before we jump for joy and congratulate the Ozzies, the SOPA does has it's shortcomings. The very issue that it is trying to fix (try to make it easier for Consultants & suppliers to claim oney from Contractors without the legal red tape) is also it's biggest downfall. Because SOPA is not a court, therefore it's findings is not a legal judgement and cannot be enforced without getting it rectified in a court of law.

However, recent amendments to the Act has somehow address some of SOPA's shortcomings. The courts have been given the legal empowerment to grant judgement "automatically" in favour of decisions made by SOPA. In other words if you win your claim under SOPA, one only has to apply to the courts to "rubber stamp" that decision and grant a legally enforceable court judgement. Of course there are still loopholes in the SOPA but I will not go into that.

The other thing I find disturbing is the defects liability period in Malaysia. It is far too short. Some defects like the example I always use - concrete cancer, takes years to surface. Other examples are cracks due to settlement of the soil or water damage and faulty fixtures (like our Parliament house). So, in Oz it has gone from one extreme to the next, our DLP can be as long as 18 years after practical completion.

This can cause enormous headaches for Consultants, Contractors and Owners. Professional Indemnity Insurance is a "claims made" policy. This means if a claim is made in 2007 and you are insured with Company B, then the claim is made on B EVEN though the building was constructed in 2003 and the insurance company in 2003 was Company A.

So insurance Company B will not be impressed because Company A picked up the premium in 2003 and for all intention and purpose the mistake was made back in 2003 and was ONLY identified in 2007.

The biggest headache is for Consultants, Contractors and Owners. They will need to maintain "run-off" insurance for a possible 18 years, just in case something they have done in the past comes back and bite them on the arse latter on. This is not so bad if they are continously in business and are insured anyway BUT they have to REMEMBER to keep run off insurance when they leave the industry or RETIRE.!!!

I can go on and on about legal and insurance issues, but I won't. However, there are some very useful lessons to be learnt and perhaps copied by our Malaysian counterparts for example greater protection for the consumers and it push greater emphasis on Quality Construction because Contractors know if they do sh*tty work it will come back and haunt them. BUT if the Contractors are all in bed with the Authorities and if you know the right people you get away with it, then Msia will just have to remain third world !!
-----------------------------------
Posted: 31 May 2007 at 2:07pm

Nik Zafri's Response

I of course not a good consultant myself - most of the times - to tell you the truth - my clients found my services to be 'lousy'...(a client even dare sms'ed' me which went something like this : "Attn : Mr. Nik Zafri, CONsultant" - I took that as a joke and replied to him "Attn : Mr. X, CONtractor".

So we had a good laugh but imagine - would it have been - I take that 'CON' word personally, I would have probably lost another business opportunity.

Clients are funny people - whenever they say, they don't like you, don't trust them especially when they still call you up whenever they are in trouble. I presumed they ARE satisfied at least to a certain degree Smile

Whenever I ask them "Why did you call me back since you've 'rated me low'"? The typical answers would be "You quoted cheaper than everyone else"

So I asked again "What about my work? Say - If I quoted RM1.00/manday and I give the RM1.00 quality, would you be willing to call me back?"

They fell into my 'death trap' when they answered "NO!".

I asked again "So...you ARE satisfied with my work..." - They would quickly reply : "Nik, you want the job or not?"

---------------------------

Anyway, back to my point - suffice it to say, I'm so very honoured that yourself, Mr. Yusri (wherever he is now) decided to join this thread - you are always welcomed.

---------------------------

Back to ahvincent :

Our nation is still young...we need every Malaysian to help us whether they are overseas or local. I am always delighted seeing good inputs from everyone here. I'm still a strong believer in paradigm shifts - I detected there are still abundance of 'opportunities for improvements' here in Malaysia, thus I think I give it 'another shot'.

If only all parties entering the contract can sit down and talk, I'm sure we can come out with something and work together - so that we can reduce any shortcomings.Sometimes we overlook simple things like 'breaking the ice" or "breaking the communication barrier" or "reducing office bureaucracy".

Your case about 'Professional Indemnity Insurance' is a very good one and I have no comments on that one.

Kinda remind me of Contractor All Risk - (hypothetically speaking) - offering full protection against damage/loss related to construction. They say it's useful to consultants as it contributes to reducing the overall construction expenses and at the same time offers efficient financial protection for all concerned - again - in theory - cos' I have seen things being turn upside down when it comes to implementation.

----------------------

Additional points

If I'm not far too mistaken, I've read somewhere of something known as 'Developer's Warranty' which immediately commences after the DFL is over and CF/CMGD is given. It's kind of 'extended warranty' given by certain big Developers after CMGD/CF - I'm unsure how long (the extended period), what's the coverage is like (type of defects covered) and if there is any cost variation/difference for those who 'signed up' for this 'warranty' (like additional costs to be paid by the owners/purchasers or fully "insured" or possibly being 'shared' by both developer/owner).

But what I'm sure is that this concept has not been practiced widely yet. It's kind of good idea to support ahvincent's argument on DFL period extension.

Unless I'm wrong (ahvincent please enlighten me) I think one of the reasons they come out with this 'extended warranty' idea possibly due to the thinking that 'if the DFL be extended to a longer period', what happens to CMGD/CF? When can it be issued? (I know..this is not a very intelligent question - it's kind of confusing when you literally follow the process)

If I'm right, the 18 years period mentioned by my friend ahvicent possibly covering this 'extended warranty' after CMGD/CF has been issued - in simple terms/process :

Certificate of Practical Completion -> Defect Liability Period (x-period) -> CF/CMGD -> Extended Warranty (+ another x period)

OR

If DFL end results are found to be dissatisfactory, it may be extended for a longer period until all defects have been rectified, only then CF/CMGD is given and Extended Warranty period starts. (so it's all in one package)

Right ahvincent?
------------------------
Posted: 01 June 2007 at 11:27am

Comments by Nik Zafri

Yes, I sometimes remind my clients that this is just a system not a way of life but one of the many systems that may (or may not) improve the way of life. The system can be changed if we are not too rigid or narrow to certain clauses only.

This scenario happen during one special meeting between this one client and the contractor (where I was called to become some sort of a 'mediator' by the 'bigger bosses' of the client - the real Owners) to discuss further understanding of contract clauses (as a result of conflict of interest) and review/amend where necessary. But since everyone wanted to say something - it's more like 'talk the walk' not vice-versa. (unproductive meetings)

The Owner got 'fed-up' and turned to me "Nik, please takeover for me?" and I said "No problem, leave this to me". What I did was unexpected but very effective. While everyone was busy indulging into intellectual arguments, I ordered pizzas through my mobile phone. When the pizza man arrived, I paid for the whole bill (which distracted almost everyone but I told them..."on the house") Everybody stopped and distributed the pizzas to all the meeting attendees.

While we're eating, I looked at them and said :

"If only we all can come to a collective decision and understanding, like the distribution of the pizzas where everyone gets their share, I'm sure we can resolve this problem amicably"

There was a moment pause and everyone was looking at me. They just realized that the Owner was 'long gone'. In the end, they let me decide what's best for them and the problem was solved.

Sometimes, life is funny, it takes only one piece a simple pizza with a lil bit of philosophical flavour to prevail.

p.s. (it's a long story but if you know the real case, I guarantee that you will say "what a silly company..." and this "silly" company is ironically 'a big company' but unfortunately with 'small thinking')
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nikzafri



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PostPosted: Sat Jan 12, 2008 12:24 pm    Post subject: Reply with quote

The Star Global Malaysians Forum

Headline The Star - Tuesday May 1, 2007

Pak Lah orders immediate inspection of government buildings -By SHAHANAAZ HABIB and ZULKIFLI ABD RAHMAN

KUALA LUMPUR: The Prime Minister has ordered an immediate inspection of all government buildings for defects.

This comes in the wake of three incidences of collapsing structures in the last three weeks � the most recent case being the new Court Complex in Jalan Duta, where a ceiling came crashing down yesterday.

�I feel angry. I feel ashamed. What the hell is this? It�s so new and such a thing happened.

�Something must have gone wrong somewhere. We need to know. I can�t be jumping all over the place!� said Datuk Seri Abdullah Ahmad Badawi, who directed the Public Works Department to carry out immediate inspections.

Three weeks ago, operations at the Immigration Department headquarters in Putrajaya came to a standstill because of a burst water pipe.

Last Saturday, part of the ceiling of a multi-purpose hall at the Entrepreneurial Development and Co-operative Ministry collapsed, causing a water pipe to drop and burst in the process.

Yesterday�s incident at the Court Complex was the last straw for the Prime Minister.

He said all three buildings were new and therefore it was imperative that investigations were conducted to determine �what exactly had gone wrong.�

�We have to check all (government) buildings because of what has happened. Maybe there are some other places that we think there is no problem but later they, too, collapse.

�I have said repeatedly, �Maintenance, maintenance, maintenance.� But people, as long as nothing happens, couldn�t be bothered,� he told a press conference after chairing the Umno supreme council meeting yesterday.

He noted that investigations at the Immigration headquarters found that one of the joints to the pipes was not properly secured.

Abdullah reiterated that inspections should be carried out on a continuous basis.

�Only then will they see where there may be problems,� he added.

In Shah Alam, Works Minister Datuk Seri S. Samy Vellu said two pieces of 1.22m-long ceiling material collapsed inside the new court complex.

He said the collapse also brought down the downlights or ceiling lights that were not attached to the main structure of the ceiling.

Samy Vellu said the building was designed by architects from the PWD headquarters and built by Johawaki Development Sdn Bhd.

�The two pieces fell, along with the downlights, because the contractor had fixed the downlights without attaching them to the main ceiling structure,� he told reporters before opening the 61st Selangor MIC convention yesterday.

On the ceiling at the multi-purpose hall of the Entrepreneurial Development and Cooperative Ministry, Samy Vellu said Putrajaya Holdings was the master builder but the maintenance of the hall was taken over by Jutabina Sempurna Sdn Bhd from Oct 1, 2004 to Sept 30 this year.
----------------------
Nik Zafri's Comments

Nik says :

Simple and basic questions (nothing technical at all)

Again, how did the CMGD (Certificate Make Good Defect or CF) and CPC/(Certificate of Practical Completion)Handover or perhaps during Defect Liability Period - approved without proper joint inspections with the clients/consultants?

The best part is that, how come the clients/consultants never realized the contractor's shoddy work (during inspections?) - Nice outside but bad inside - unseen. Why? because during the construction stage, nobody really bothers to check what's going on - or perhaps checking is limited only the wall, floor but not ceiling..:(just visual inspection - "yeah I have experience..I'm a pro..I can quickly tell that the ceiling is ok by a mere glance"....I've heard of this snobbish statement before)

I'm not implying that the consultants and the clients were not doing any inspections, but would the inspections been done in a real proper manner, then all these problems would never occur or can be greatly minimized on the first place. (I was also involved directly in some of the government buildings/offices projects - we used CONQUAS CIDB /BCA Singapore 5 Star Checking/Inspection - very stringent - but less complaints)

(Mind you guys, I think I know who the contractor/consultant/client that Pak Lah was referring to..yes, they are a bit stubborn and don't want to listen to good advice. so the world of construction in Malaysia is not that BIG after all..you have problems and everyone in the construction community will know about it...But I'm not going to mention names here - Siapa makan cili...rasalah pedasnya)

The issue is about proper monitoring by the client/consultant on the contractor. If the client/consultant were stringent, then the contractor won't dare to hide such shoddy and no-quality work.

2. And how was the contractor being appointed? If there are selection criterions, was they really being properly adhered to?

3. And how come the actual construction/structure not complying with the 'beautiful mock-up sample' or 'unit'? How come the sampling/testing used are not really being counterchecked during inspection? If the sampling is of small benchmark and triggered doubt, then make it bigger! If a counter testing(s) is/are required, then go for it.

I can go forever and I can surely pinpoint more unnecessary errs but I still hope that genuine continual improvement would really happen.

This case can become potential accidents (could also be fatal) if taken lightly.
-----------------------------
Here's more reports from the Star Nation - May 2, 2007

Shoddy work could be tip of iceberg, says Navaratnam

KUALA LUMPUR: The recent collapse at three new government buildings is symptomatic of the state of deterioration in standards, quality, productivity and efficiency in the country, said Tan Sri Ramon Navaratnam.

�There�s too much concern to make a quick buck and too little attention given to professionalism. This could be the tip of the iceberg,� said the Transparency International Malaysia president.

He believed the problem was not going to end until something was done to address the root causes and make those responsible pay.

�If a contractor is careless and indifferent in his work but continues to be rewarded by getting contracts and making more and more profit for shoddy work, why should he change? He does not pay the price for it. That�s human nature.

�But if you penalise him, deny him the contract and blacklist him � then they (contractors) will realise (they can�t get away with it).

�The authorities should look at this more seriously and not talk more but do more,� he told reporters yesterday after delivering his address at the Towards Achieving Quality in the Civil Service seminar.

He said if necessary new legislation should be introduced. Three weeks ago, a burst pipe at the new Immigration Department Headquarters in Putrajaya brought its operations to a halt. Then on Saturday, chunks of the plaster ceiling at the multi-purpose hall at the Entrepreneurial Development and Co-operative Ministry collapsed. The third incident was at the new Jalan Duta Court Complex, where two parts of a ceiling collapsed. Navaratnam said these couldn�t be seen to be isolated or mere coincidences.

�These are big projects. It�s like a disease. If you don�t see you�ve got a problem, then you won�t solve it. I�m not being pessimistic, but realistic and pragmatic,� he added.

Navaratnam welcomed the Prime Minister�s directive for all government buildings to be checked for defects.

�We should do something before it is too late. It reflects the quality of our workmanship and professional and ethics today. This has obviously been going on before. It isn�t as if it has suddenly changed,� he said.

Works Minister Datuk Seri S. Samy Vellu also welcomed Datuk Seri Abdullah Ahmad Badawi�s call for the Public Works Department to inspect all government buildings nationwide.

�I respect the PM�s statement and will discuss the matter in the Cabinet meeting this week,� he added.

Nik says :

Tan Sri Ramon is right (tip on an iceberg)! But again, the contractor shouldn't be burdening the blame alone. But I beg to differ - the client/consultants should also play their role in effective periodical monitoring.

It's like a naughty son having a good father. The father must monitor his son regularly - not just give money. Otherwise the father will never know what the son is doing with that money outdoor and by the time the father realizes it, the son is already in jail.

The public will say that = "lack of parental control" although it's clear that the son is at fault. But yet, it portrays the father as well, despite how nice the father is.

(Thus the analogous - father=client and son=contractor)

----------------------------------
The Star News - Nation - April 30 2007

Contract review for Putrajaya buildings By SIM LEOI LEOI

[email protected]

PUTRAJAYA: Government buildings in this administrative capital may be more sophisticated than elsewhere in the country and it is only reasonable for the Public Works Department to re-look the maintenance contract. Stating this, Entrepreneurial Development and Cooperative Minister Datuk Seri Mohd Khaled Nordin said the department should see if all steps taken so far had been enough to detect any defect or wear and tear in the buildings. He was speaking to reporters after visiting the multi-purpose hall at his ministry, where part of the plaster ceiling collapsed on Saturday morning.

�The standard of maintenance of Putrajaya buildings may have to be further enhanced.

�I hope the department will focus on this matter so that what happened on Saturday and earlier at the Immigration Department will not recur elsewhere in Putrajaya.�

�This is Putrajaya, such an incident should not have occurred,� he said.

Early on Saturday, water from a burst pipe rained through the ceiling at the hall, causing chunks to come crashing down. Less than three weeks ago, a burst pipe at the Immigration department caused widespread damage and brought daily operations to a halt. Yesterday, workers were busy repairing the ceiling. Khaled said earlier inspections on the building and its pipe systems by the maintenance team had not revealed any defect. He said the crumbling structures of the country�s administrative capital required damage controls befitting the city�s sophisticated buildings. He suggested that the exact nature of the contract should be looked into to see if it is adequate. Currently, Jutabina Sempurna Sdn Bhd is maintaining the building until September. Ministry secretary-general Musa Muhamad said although the building had received a Certificate of Fitness, it has yet to be given a Certificate of Make Good Defect (CMGD). Musa added that Putrajaya Holdings would be carrying out an investigation into the incident, adding that the rest of the building had been declared safe after an inspection.

-------------------------------------

The Star News/Nation, Monday April 30, 2007

Ceiling crashed during check by developer

PUTRAJAYA: The master developer of this administrative centre was inspecting some buildings and construction under its supervision when a ceiling crashed down at a ministry building in Precinct 2 on Saturday.

�The contractors were about to conduct checks on the buildings with their own plumbers when the ceiling at the Entrepreneurial Development and Cooperative Ministry�s hall came crashing down,� Putrajaya Holdings chief executive officer Azlan Abdul Karim said yesterday.

He said after an earlier incident at the Immigration Department, he requested all the corporation�s consultants and contractors to submit detailed reports on how they carried out inspections on the buildings. Asked if the collapse of the ceiling would hasten the inspections of all buildings, Azlan said Putrajaya Holdings already had the matter in �fifth gear.� On how the construction projects in Putrajaya were awarded, he said it only chose companies with good track record.

�They would usually have their own consultants to decide on the design of the building.

�We have our own consultants to check their design,� he said.

On the recent spate of incidents in Putrajaya, he said: �These shouldn�t have happened but they had happened.

�We are coming in to make sure there won�t be any more incidents. We don�t want to blame anyone.�

Meanwhile, a Works Ministry source said it was likely that the ceiling had collapsed first, bringing down the fire sprinkler pipe.

�This is because the sprinkler pipe is made of galvanised steel and thus, impossible to break.

�This kind of pipe is supposed to last for many years. Instead, the ceiling came down, bringing along the pipe and bursting it.�
----------------------------
Here we go again (welcome home Nik...there's nothing like home - same ol story)

The Star Wednesday, May 23, 2007

Public quarrel over Parliament repairs unacceptable, PM tells Samy - By SA�ODAH ELIAS

TOKYO: Just do it � that�s what Prime Minister Datuk Seri Abdullah Ahmad Badawi told Works Minister Datuk Seri S. Samy Vellu over the maintenance of Parliament House, which has a leaking roof and faulty wiring. Pointing out that a public quarrel between two government organisations over who should be maintaining the august House was unacceptable, Abdullah said whoever was responsible must execute their duties and take action when needed.

�Don�t wait to be told, (if) that is your responsibility, just do it,� Abdullah told Malaysian journalists covering his five-day state visit to Japan yesterday.

Abdullah, who had earlier met Japanese Prime Minister Shinzo Abe, was asked to comment on Samy Vellu�s claim on Saturday that the Public Works Department, which is under his ministry, was not responsible for maintaining Parliament House. Samy Vellu was quoted as saying that the maintenance had all along been under Parliament itself and not the PWD, adding that the department could not interfere as Parliament was independent and could not be ordered around. The 44-year-old building, which was renovated two years ago at a cost of RM90mil, suffered from, among others, cracks and water seepage on the concrete roof, clogged gutters, defective waterproofing and sewerage pipe leaks at VIP and other toilets.

Abdullah said he had already told Samy Vellu that he would have to oversee all works relating to the maintenance of public buildings.

�So stop the public quarrel over the matter,� said Abdullah. �It is shameful that government departments have to quarrel over their respective responsibilities.

�Isn�t it better if departments cooperate with each other?

Lamenting the lack of maintenance culture, the Prime Minister said Malaysians should try to emulate the Japanese who are highly disciplined and have a high sense of civic consciousness.

�Look at how they queue. Irrespective of how long the queue is, and there is obviously a space where they can do it, they never jump queue. This is something that we can learn from,� he said.
---------------------------
The Star Nation - Sunday May 20th, 2007

Government has no choice but to fix roof immediately, says Najib

KUALA LUMPUR: The Government has no choice but to repair the roof of Parliament building immediately because it houses a very important institution in the country, Datuk Seri Najib Tun Razak said. The Deputy Prime Minister added that the Public Works Department (PWD) would also be asked to explain how and why the leak occurred. In expressing his regret over the water leakages in the building, Najib said the repairs should have been included in the original renovation budget. He said that when the allocation report for the major facelift work for the Parliament building was submitted to the Government earlier, no request was made to carry out roof repair work at that time.

�We are wondering how that had escaped our consideration. The Cabinet will discuss this,� he told reporters after presenting degrees and diplomas to 320 graduants of Universiti Tun Abdul Razak (Unitar) here yesterday.

Najib said the Cabinet would also decide whether the repairs should be borne by either the Government or Parliament. Works Minister Datuk Seri S. Samy Vellu, after inspecting the rooftop on Thursday, said its condition was severe and the whole structure needed to be rebuilt. Samy Vellu added that repairs would include installation of waterproofing and concealed ceiling equipment for heat protection.

On Friday, Public Accounts Committee chairman Datuk Shahrir Abdul Samad questioned the failure of the relevant authorities such as the PWD to include waterproofing equipment in the Parliament roof. He said the Parliament Department should be accountable. Transparency International Malaysia has called for a public inquiry by a parliamentary select committee or an independent commission to look into the leakages. President Tan Sri Ramon V. Ravaratnam said it was �a real shame� that the Government had spent so much money (about RM90mil) in the renovation but the ceiling was not rainproof.

�Taxpayers deserve a full explanation on how and why such things happened.

�The contractors must be penalised, otherwise the same thing will happen again.�

---------------------------
The Star News Opinion - Saturday May 19, 2007

Another hole in the pocket

COMMENT By WONG CHUN WAI

[email protected]

Shoddy workmanship and a poor maintenance culture are taking a toll on the Government�s coffers. Do we have to spend money to fix problems that shouldn�t exist in the first place?

MALAYSIANS can�t be blamed if they hit the roof over Datuk Seri S. Samy Vellu�s statement that the condition of the Parliament House roof is so bad that the whole structure has to be dismantled and rebuilt with waterproofing material. The Works Minister did not give an estimate of the repair bill but we can expect the figure to run into millions of ringgit. After all, Samy Vellu has already said that it would cost RM22mil just to carry out checks on all government buildings in Putrajaya. Taxpayers have good reason to be upset because it has cost them RM90mil in 2005 when Parliament House was renovated. Apparently, waterproofing material was not installed then. Different figures have been reported on the actual amount spent � ranging from RM60mil to RM85mil and now RM90mil � but what is certain is that it was a lousy job. On April 28, 2005, Members of Parliament had to leave the Dewan Rakyat when water seeped through the ceiling, drenching two rows of benches, and forced proceedings to be adjourned. Television sets situated at specific points, including the media centre, went blank while Finance Ministry parliamentary secretary Datuk Seri Dr Hilmi Yahaya had to stop his speech because his microphone failed. At the Dewan Negara just a few steps away, it was reported that two posh leather chairs broke when the Senate was in session.

Speaker Tan Sri Ramli Ngah Talib was then quoted as saying, in a rather dramatic manner, that �it was too dangerous to continue with the proceedings, the water wasn�t slowing down and the ceiling could have collapsed for all we know.�

Opposition Leader Lim Kit Siang called it a �day of shame for Parliament.�

Two days later, Ramli must have recovered from the mishap as he said that the roof leak should not be linked to the renovations, and that the matter was a �technical oversight and already rectified.� The renovations, he added, were generally good.

Samy Vellu ordered the Public Works Department to investigate while the Public Accounts Committee also promised a probe, with PAC deputy chairman Dr Tan Seng Giaw saying that the whole building needed to be checked. It would appear that Samy Vellu and the PAC would probably have been told that all problems had been fixed, and all have been forgiven and forgotten until Wednesday�s uproar in Parliament over another ceiling leakage. Worse, the complaints over the water seepage at the media centre by some MPs degenerated into a new controversy when the MP for Kinabatangan Datuk Bung Mokhtar Radin and Jasin MP Datuk Mohd Said Yusof made their now infamous bocor remarks. Their sexist remarks, which led to their formal apology to women in Malaysia, almost led to Malaysians forgetting the issue at hand. Even Minister in the Prime Minister�s Department Datuk Seri Nazri Aziz said the Parliament House was safe and that �it is 40 years old and nothing has happened to date.�

But Samy Vellu is now telling us a different story. If the Works Minister is right, Malaysians can expect the Treasury to have a bocor in its pocket, with another expensive repair exercise coming up because of shoddy maintenance. Water leakage may be common in old and new buildings and those of us who have moved into new houses would know that we often have to call up the developer to carry out patching work during the one-year warranty period. But Samy Vellu, a trained architect, has declared that the leaky roof is a �severe problem� and that the whole structure must be removed.

Five spots, he added, were found near the Dewan Rakyat and Dewan Negara galleries and �if immediate repairs are not made, the situation will worsen and the leak will spread to 10 or 15 spots.�

The dignity of the august house and the safety of the Right Honourable Members are important but the interest of taxpayers are equally important. I believe Malaysians in general are not amused by such huge amounts of money being spent on repairs and maintenance. The culprits should be hauled up and sued for damages if we wish to send a strong message to those who get government construction jobs. The Parliament maintenance staff should also answer for the pile of rubbish, mainly construction waste, on the roof, which had clogged the drainage system. With due respect to Samy Vellu, who has vast experience in public works, we would appreciate it if he can provide us with details of his estimates, including the RM22mil for checking buildings in Putrajaya. The Prime Minister, I believe, would want to know the damage for the maintenance work and costs to be incurred when the Cabinet meets next week.

-------------------

My brief comments

1. Quoting Mr. Wong Chun Wai :

Do we have to spend money to fix problems that shouldn�t exist in the first place?

2. Why only contractor being penalized? How could the clients and consultants suddenly become so invulnerable and not be penalized as well. They are the MONITORING SYSTEM during stages of pre-construction, during construction and post construction.

Simple : blaming culture at work!

Thus, I stand strictly by my irreversible original views that the contractor wouldn't dare to do shoddy work IF the consultants and clients are strict enough in their 'expert supervision' - whatever the reasons might be.

I welcome those who like to intellectually argue on my statements here - anytime & any place - no matter whoever you are - be it professional engineers, legal practitioners, developers, project managers, consultants and contractors.. But I recommend those 'naysayers' to please read all the threads herein first regarding this matter - to think before you leap.

"KNOWLEDGE IS MY GUN"

-------------------------------

The Star News - Nation Thursday May 24, 2007

Court complex hit by calamity again

KUALA LUMPUR: Yet another calamity hit the brand-new Jalan Duta court complex yesterday when a faulty pipe burst, causing the cafeteria floor to be flooded.

At about 9.15am yesterday, a burst pipe end cap caused water to gush out from a service room at the basement cafeteria, resulting in much of the floor being covered in 7cm of water.

The incident was the latest in a series of major incidents in less than a month to hit the RM290mil complex, touted as the world's second-largest court complex.

Public Works Department (PWD) director-general Datuk Dr Judin Abdul Karim said the incident was caused by a pipe end cap at a T-joint.

�The end cap was made of UPVC material which is different from the T- joint which was made from ABS class 15. The end cap has been replaced with an ABS elbow class 15 as per the original specification,� he said in a written statement

Dr Judin, who arrived at the scene at noon, refused to speak to the press and tried hard to stay away from reporters. His statement was read out by PWD deputy director-general III N. Selvanayagam. The statement said contractors were despatched to the affected area at 9.30am and the leak was brought under control by 9.40am. The situation in the cafeteria returned to normal by noon after the cleaning process was completed. Dr Judin said the PWD would report the main contractor to the Construction Industry Development Board. He added that the plumber would also not be spared. When reporters managed to get to him, Dr Judin refused to comment further and only confirmed that checks were being conducted on the whole building.

Acting Chief Registrar of the Federal Court Ahmad Terriruddin Mohd Salleh, who rushed from Putrajaya upon being informed about the incident, also refused to comment.

�We will leave it to the Public Works Department to handle,� he said.

The nightmare for the new court complex began on April 30, just before the official opening on May 3, when two ceiling panels collapsed together with some lights. Less than a week after that, cracks measuring at least 3m long began appearing outside Magistrate's Court 4. A check by The Star yesterday revealed that the cracks have since been patched up.

On May 7, the air-conditioning in one of the High Courts malfunctioned, while on May 9 the entire complex experienced a blackout, resulting in several cases being postponed.
-------------------------------
Nik says :

The application of different pipes namely - Thermosets(FRP), Vitrified Clay, Concrete, Ductile Iron, UPVC, ABS would depend on the many conditions.

There are always pros and cons e.g. Environmentalist are not favouring PVC pipes because of the nature of manufacturing process & 'ingredients used'. But of course there are 'pros' as well like cost, lighweight, easy installation etc.

Most standards/codes discourage connection (gluing) of PVC to ABS (using solvent-welded) Although it is a known method but not really an alternative to ensure the most secure joint. So; I think; the corrective action taken by replacing the end cap with ABS could be the right way.

PVC material is very susceptible to chemical attack, particularly by solvents and the strength can be influenced by sunlight unless UV protected. ASTM (can't remember the no.) also note the maximum temperature that PVC can withstand.

I can't be sure if the leak was originally caused by solvents (improper application) or perhaps temperature (that caused the problem of the end cap on the first place). My hunch says it's temperature.

But of course, this case is still relevant to improper supervision and inspection by all parties - not only the plumber and contractor.
-------------------------
Response by MAQ0607 a.k.a. Yusri Doha

On the latest incident in Malaysian biggest court, I think the major factors contributed to pipe burst are due to:

Poor workmanship and lack of supervision during construction stage
Excessive pressure from the supply (water tank or from booster pump)
Selection of wrong materials

The Client in this case our government need to further improve on selection of supervision Consultant and to extend the Guarantee Period (defects liability period) instead of 1 or 2 years to 3 years. Let the Contractor be responsible in case they performed badly on workmanship or materials supplied.

Regards,

Yusry Doha
---------------------------
Nik Zafri's Response

Posted: 25 May 2007 at 6:19pm

Welcome Mr. Yusry to the forum and thank you for coming in but don't just limit to one or two posts, keep giving this construction quality management thread a 'life'. You could say that there are not many here putting interest in this important topic. Your inputs are deeply appreciated.

Yes, I thought of the same thing as well that the the possibility of excessive pressure from the tank or booster pump could be the root cause. (I have no comments on the factor of poor supervision as I think I have said enough within this forum) Of course the situation become worse when 'marrying' the two different materials with different strengths (or even size) - to match the 'x' psi flow rates and 'y' pressure of the pump. (I'm not really good in this M & E and Plumbing stuff)

Thus, again - if we look into the big picture, this issue goes back to the fact of improper/inadequate supervision/inspection/testing as well from 'all relevant/interested parties'.

On the other hand, let's 'get out' of the 'technical stuff' for a while. I was discussing with some 'friends' and we came out with a new resolution on this matter. Without mentioning names, FYI, from my good sources, this project was said to have been undertaken by one developer/contractor but due to some problems - it was later taken over by another developer/contractor to 'finish' the 'unfinished business'.

To be fair, thus, let's see in the 'new' contractor's point of view - let's talk on cost reestimation. Do you think assuming the new contractor 'disliked' the new cost, they would be providing a 'lil bit low' quality of materials? (not to mention 'chain reaction' from the global crude oil price volatility where materials 'going up' higher and higher)

Not because they did so on purpose (taking 'risk' providing 'alternative materials') but since it's difficult times, they have no choice but to take the job offer. (I believe you are working with a contractor? and may have worked/involved in the Government Building/Complex in Malaysia?)
-------------------------------
Posted: 25 May 2007 at 9:29pm

Yusri's response

So this building is completed by other Contractor taken over from 'failed to perform Contractor'. I presumed the existing Contractor being terminated due to poor performance/by default. To appoint new Contractor to continue on remaining works is not an easy process. Proper evaluation need to be done by QS Consultant to ascertain the value of remaining works and then produce the new Tender document for new Contractor to price. From there QS Consultant will evaluation the bid price and recommend for award to Client. To obtain a competitive price this tender should be issued on open tender. For selective tender, the selected Bidder for the remaining works should be given a chance to quote for new price instead of roll-on existing price/rates. I'm confident that new Contractor will implement cost cutting measures like opted for cheap alternative materials, hire unskilled workers, skip some routine inspection, etc, etc. if they are being offered/awarded to continue the Contract on the same prices/rates.
---------------------------
Posted: 04 June 2007 at 7:51pm

Here's another update.

Ambrin promises thorough check

By SIM LEOI LEOI

[email protected]

PUTRAJAYA: It is indeed a formidable task - 72 government buildings in Putrajaya, 22 in Kuala Lumpur and another 168 rented offices, and probably piles of paperwork.

But, Auditor-General Tan Sri Ambrin Buang is promising that the team set up to inspect the government buildings in the wake of recent mishaps ranging from burst pipes to collapsed ceilings will be thorough.

�We established the team on May 11 and in our first round, we inspected four buildings in Putrajaya � the Immigration Department, the National Registration Department and the Entrepreneurial Development and Cooperative Ministry, which are located along the Boulevard in Precinct 2, and the Road Transport Department in Parcel D.

�Initially, our mandate was to concentrate on Putrajaya but now, this has been widened to Kuala Lumpur,� he said yesterday.

Ambrin said the Government had ordered a total audit of all these buildings.

�First, we will check what the complaints regarding a particular building are, and whether these have been attended to or not. We will also check for the cause of damage and if this was due to design, material, poor workmanship or simply because the workers were not paid on time. (Nik says : how about checking on the improper supervision by the Client/Consultant that resulted in the contractor doing whatever they wish?)

�A total audit of the buildings will involve both physical checks, from the roof and piping, as well as perusing all the financial records and documents relating to the construction and maintenance of the buildings, and whether these adhere to best practices. We will be meticulous,� he assured.

Based on the initial inspection of the four buildings, Ambrin said the team had formed �some ideas,� but reiterated that they still had a long way to go.

Prime Minister Datuk Seri Abdullah Ahmad Badawi had ordered the audit of government buildings after a series of mishaps at public premises, like a leaking pipe at the Immigration headquarters on April 11, the collapse of a ceiling at the Entrepreneurial Development and Cooperative Ministry�s multipurpose hall on April 28, and falling ceiling panels at the newly opened Jalan Duta court complex in Kuala Lumpur more recently.

Works Minister Datuk Seri S. Samy Vellu subsequently announced the formation of the team, to be headed by Ambrin.

The Auditor-General said his department, which was located beside the Immigration headquarters, had also had its share of problems.

Asked if the findings would be published, Ambrin said that while he did not have a problem with it, the team had yet to decide on this.

-----------------------------

Others Related :

Audit standard not up to mark

[NATION 31-May-2007]
Only 31 out of the 145 local authorities in the country have their own internal audit departments to track the movement of public monies and activities, and for some which do, the officers are so ill-trained that they find it difficult to pass their tests.
We will be watching, says PAC

[NATION 12-May-2007]
The RM22mil exercise to inspect Putrajaya government buildings for defects will be carefully watched by the Public Accounts Committee.
-----------------------
Nik further says : I hope the end-result is geared towards coming out with some solid action plan with 'themes' like prevention, proactive action, minimizing recurrences and a must 'follow-up' session etc. Otherwise it's just another 'firefighting' and 'reactive' scenarios
---------------------------
Posted: 27 May 2007 at 4:35am

Question by ex_kl_gal

Hello everyone,

I'm new to this forum and this topic interests me. I'm a Q.S & C.M. , based in the US. The system here is different from Malaysia..no BQ's. The architect generally engages a cost consultant to prepare estimates at various stages of design ( usually Schematic, Design Development & Construction Document). The project Owner may or may not engage another cost consultant to do the same. At each design stage, there may be "estimate reconciliation" between the 2 different estimates if > 5% difference. In most public funded projects, there is a clause in the contract that if the bids come in greater than 5% over the "estimate", the architect has to redesign to budget without additional fees, so it behooves the architect to ensure he/she is within budget. The contractors bid and everyone crosses their fingers and toes ( this usually works ! )

This process was thrown into disarray in the past few years because of the irrational/volatile escalation of prices of virtually every raw material, structural steel, concrete,copper etc etc. Fewer contractors bid on projects and those who did threw a large contigency in to absorb some of the "irrational/unpredictable cost increases". Budgets were blown out of the water and the clause requiring redesign was temporarily suspended.A project I worked on had a great deal of str. steel, the prequalified contractors bidding on the job wanted a huge "cushion" set aside for price increases, the Owner refused but suggested buying the str. steel before bid and charging the successful bidder the material cost + warehousing costs. This argument went on for 2 months, neither side conceded.( warehousing costs were astronomical too). Eventually, they decided to proceed to bid and the lowest bid came in at + 20% over the "estimate"

Same situation with many other public funded projects but they have reinstated the "redesign" clause. Makes for an interesting and unpredictable situation.
---------------------------
Posted: 27 May 2007 at 4:03pm

Nik Zafri's Response

Actually, the practice of 'No BQ' has been implemented - but perhaps in a different manner in Malaysia - where the Main Contractor functions solely to provide workmanship and materials required - sometimes only workmanship. (excluding cost estimation expertise) - and these will be spelled out clearly in the tender documents and contracts. So, the contractors will be 'nett' paid (clean) - no headaches. This scenario also happens in the Construction Vendor Development Programs.

It is true that the consultants (architectural, M & E, C & S, Project Management etc.) are assigned to ensure that if good results are to be seen in the end, then the beginning must be well-planned first which in this case - the Design stage (including cost estimation)

In this case, the consultants may be engaged just to do the specific job until completion (design only ) OR they may also be awarded a bigger job - to ensure that the overall implementation is effective. The latter also demands the consultants to act as the monitoring party and communicate all requirements to the Main Contractor on the Client's behalf.

The Client hire another estimator for 'reconcilliation' purposes - to get another party's expert opinion and finally the actual estimation will be consolidated.

However, in the other scenario that you've mentioned is ironically a 'common' thing when EVERYTHING is 'thrown' on the shoulder of the contractor - now this is where most problem started - it's all about money. The Client has so many projects but looking for a contractor that 'has money' (no money no talk). You'll be surprised to see that even Consultants are placed under the Main Contractor's 'payroll' where the former is being nominated by the Client.

The Client will likely come out with 'stringent Contract clauses' mostly 'favouring' them and to save them. Just imagine, how can the consultants work properly when there is 'one leg' in 'one party' and the 'other leg' is 'in the other party'? (one with authority, the other is paying them salary) They are no more than 'sub-contractors' themselves and 'sub-contractors' are supposed to be 'loyal' to the Main Contractor.

(I pity the consultants very much and they have been expressing to me their dissatisfaction on this matter during my audits/assessments - mostly about having to work, recognize and be 'abused' by 'many chains of command' - not to mention their professional fees are not being paid accordingly)

On construction materials price volatility - whilst I understand that it has something to do with the global crude oil price, But I still can't understand why the authorities are 'tight-lipped' on planning to cap the price or making it a rule that manufacturers must provide the production schedule and transparent on the 'supply chain' (agents, brokers, suppliers, distributors, resellers, wholesalers, retailers etc.). I heard rumours that contractors are buying construction materials from the 'black market' and when asked, they would say to me : "That's the rule of the game nowadays.

But to tell you the truth, I think we still have a loong way to go in terms of maintaining discipline yet that's how I earn my salary - when something goes wrong, I will be there. It's like helping a blind man crossing a busy road. Tough job..but someone has to do it.
-----------------------------
Posted: 28 May 2007 at 9:24am

Response by ex_kl_gal

Nik,

I'm surprised that this is allowed to happen..( consultants being paid by contractors and expected to look after the Owners interest.).a total conflict of interest and a contractual scenerio just begging for misuse and paybacks .

Regarding the no BQ scenerio, I worked on a large design/build project in KL and the contractor treated every/any Request for Info as a Claim..$ and schedule delays.

There has to be a better way to manage these large projects to ensure that the GC is fairly compensated and that the Owner gets the his/her project done on time and within a specified budget ( allowing for a certain minimum of Variation Orders & Claims )
---------------------------
Posted: 28 May 2007 at 7:12pm

Nik Zafri's Response

Yes, I forgot to mention 'design & build' or 'turnkey' basis in my last reply (although if you read some old threads - I have been discussing with the guys here including the PFI concept) I've also worked with many mega projects in Malaysia and UK as well and thank goodness, most (not all) - these projects follow rules and regulations. (but mostly run by foreigners/or multinational/Internationals) All parties including the project/operation management team; I would say; overall...splendid!

In some cases, not only the clients engaged their own consulting teams but the Main Contractors as well (so that both parties (consultants vs consultants) speak in the same lingo)

I also like to make a small disclaimer/correction; to avoid misunderstanding; not by you but the Clients who might have read my postings :

My last statement about 'Client-Nominated Consultants being placed under Contractor's payroll' is not meant for ALL clients or not in any way implying that the practice is 'at large' or becoming a trend in Malaysia but I've been bumping into cases like these during the course of duty.

Trust me..even this case has legally binding contracts/special clauses (even a specific procedure has been developed by the contractor) and surprisingly AGREED by the consultants themselves (perhaps they have no choice) I've also seen contractors being 'instructed' by the Client to have site offices for consultants to be built at the contractor's cost!! (camouflaged under the pretext of 'contractor's site office')

Now why would the contractors honor these 'strange' instructions? I think - they are 'scared' that if they do not follow Client's 'special' or 'verbal (non-recorded)' instructions or 'so called' 'implied' requirements, they probably would end up not getting 'a good treatment' from the client. To me, this is another kind of 'extortion' or possibly 'corruption' at work!

But of course...I'm not mentioning names and usually my assessments are limited to gap analysis/independent evaluation/process including consulting/running workshops/inductions for the construction industry and not 'investigative kind of audit'. (there are instances where I'm called for 'special audits' but mostly on NDA basis)

So I just leave that problem to the real financial auditors to figure this out.
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nikzafri



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PostPosted: Sat Jan 12, 2008 12:36 pm    Post subject: CONSTRUCTION MATERIAL VOLATILE PRICING - Nik Zafri Reply with quote

forumer by PM wrote:

Nik, what do you think about the steel price today? How would this affect the construction industry and perhaps the construction stocks?


Dear Sir, I'm still monitoring the issue (in fact I've been following this issue keenly since 2003-2004...please refer to my website or this link) Based on my 3.5 years 'research' - YES there could be disruption potentials unless better alternatives proposed. (Keyword : Production Schedule and 'too many tampering hands/business chains' stand in between the mill and the customer.

It's a long story and unfortunately I don't have that time. The following reports from the Star may help :

1.Steel players: Price rise should be higher

[BUSINESS 18-Apr-2007]
Players in the steel and steel-related industry generally welcomed the Government�s move to raise the ceiling price of steel bars and billets by up to 20% but said the increase should have been higher.

2.Builders seek higher price for cheap units

[NORTH 28-Mar-2007]
PENANG: Developers here want the price of low-cost and low medium-cost housing units to be increased in view of rising cost of building materials.

3.Time to lift curbs, steel millers tell Govt
[BUSINESS 26-Mar-2007]
DOMESTIC steel manufacturers faced with increasing operational costs want the Government to consider lifting export restriction on steel bars and raising the ceiling price of RM1,570 per tonne introduced since February 2004.

4.Strong global demand further drives up steel
[BUSINESS 23-Jan-2007]
Strong global demand for steel continues to drive the price of the commodity, which will in turn support the bottom line growth of local steel players this year.
-------------------------
Posted: 04 June 2007 at 7:32pm

nikzafri wrote:
On construction materials price volatility - whilst I understand that it has something to do with the global crude oil price, But I still can't understand why the authorities are 'tight-lipped' on planning to cap the price or making it a rule that manufacturers must provide the production schedule and transparent on the 'supply chain' (agents, brokers, suppliers, distributors, resellers, wholesalers, retailers etc.). I heard rumours that contractors are buying construction materials from the 'black market' and when asked, they would say to me : "That's the rule of the game nowadays.


Whoops I spoke too soon again, here it comes :

The Star Nation - Monday May 28, 2007

Hilmi: Prices pumped up for 9MP

By NIK KHUSAIRI IBRAHIM

BALIK PULAU: Certain quarters could have deliberately inflated the prices of construction materials to make quick profits as projects under the Ninth Malaysia Plan (9MP) take off this year, according to the Finance Ministry.

The Ministry�s parliamentary secretary, Datuk Seri Dr Hilmi Yahaya, said prices were �not that high� last year when 9MP projects were in the pre-implementation stage.

�The sudden increase in construction material prices this year raises a big question. Traders have not given us any logical explanation to justify the increase,� he said yesterday.

On reports that the prices had increased due to higher transportation costs, Dr Hilmi said the quantum of increase was not justifiable.

�Cement price, for example, should not exceed RM10.50 per bag. But cement is now being sold up to RM14 per bag.

�The ceiling price of steel should be RM1,884 per tonne but steel is being sold at RM2,300 per tonne,� he added.

Last month, the Domestic Trade and Consumer Affairs Ministry raised the ceiling price for steel bars by 20% from RM1,570 a tonne.

Dr Hilmi said the ministry was looking into ways to ensure smooth implementation of projects planned under 9MP.

He also warned traders not to increase prices of consumer items following the recent salary revision for 1.2 million civil servants.

Earlier, he presented sports gear including tracksuits to the Southwest district Sukpen III (Penang Games) contingent comprising 420 athletes. The 10-day Penang Games will kick off at Batu Kawan Stadium on Friday.
---------------------------
Here's more

Well here we go again....today The Star Business (June 4th, 2007) is giving full focus on the issue :


Shortage of steel to impact projects

STORIES By ANGIE NG, HANIM ADNAN AND DAVID TAN.

Steel features prominently in Malaysia's efforts towards achieving a developed nation status by 2020. The Government's focus on the real estate sector and the Ninth Malaysia Plan will raise the importance of the raw material to the economy.

THE steel shortage fiasco, which is once again making news headlines, is threatening to affect a broad spectrum of property and construction projects if a holistic long-term solution is not found. Inadequate supply of steel and its price escalation have been a recurring problem over the years, more recently in 2003 to 2004 and previously in 1984, 1989 and 1991. Steel is one of the strategic industries identified by the Government for price control. The metal is an important component that is necessary to achieve the country's industrialisation aspirations. (Besides steel, cement and fuel are also listed as strategic sectors in Malaysia.) The rollout of the Ninth Malaysia Plan (9MP) projects from 2006 to 2010 and the buoyant property market will trigger a much greater need for steel. Industry players said the Government's new initiatives for the real estate sector, including the exemption of real property gains tax (RPGT) and the relaxation of the Foreign Investment Committee (FIC) ruling for foreign property buyers, would be negated by the sharp increase in the prices of steel bars and billets. The steel industry is controlled by seven major millers, which have cited higher production cost to seek a review for the ceiling price of steel bars and billets.

On April 16, the Domestic Trade and Consumer Affairs Ministry raised the ceiling price for steel bars and billets by 20% from RM1,635 and RM1,389 a tonne respectively. However, industry groups and trade associations claimed their members, despite paying the new ceiling price of RM1,962 a tonne, were still having difficulties sourcing for adequate supply of steel bars of certain sizes. Members of the Real Estate and Housing Developers Association (Rehda), Master Builders Association of Malaysia (MBAM), Malaysian Malay Contractors Association, Malaysia Indian Contractors Association and the Associated Chinese Chambers of Commerce and Industry of Malaysia are eager to let market forces decide the price and supply of steel bars. According to Rehda president Ng Seing Liong, the market needs two million tonnes of steel bars a year, which are way below the millers' combined production capacity of 5 million tonnes. �Going by their production capacity and market demand, there should not be any steel shortage at all. The onus is on the enforcement officers to do spot checks to determine the actual production numbers coming out from the millers,� he added. Ng said the higher steel prices had led to a 5% to 15% rise in the total construction cost of property projects, and this further squeezed the margins of industry players.

�If the Government does not want to de-control the price and import of steel bars and billets, every effort should be undertaken to ensure the supply is adequate and timely,� he said.

MBAM president Patrick Wong said that in view of the many projects to be awarded under the Ninth Malaysia Plan (9MP), major infrastructure projects could be affected if the situation was left as it was.

�A more reliable supply is necessary to ensure the smooth implementation of 9MP projects.

�Otherwise, smaller contractors may be even forced to close down, hampering the progress of many development projects,� Wong added.

Questioning the efficacy of the Government-controlled ceiling price, he said: �What is the point of having an official price control when the actual situation on the ground is uncontrollable?

�The industry is now in a crisis as steel millers continue to withhold supply until high delivery charges beyond the new ceiling price are paid.�

He said contractors and builders were facing great difficulties in obtaining steel bars unless they paid premiums of RM150 to RM250 per tonne above the latest Government-controlled ceiling price. Wong said the recent 20% increase in the ceiling price of steel bars and billets was considered inadequate by steel millers which had asked for a 30% increase.

�They have created an artificial shortage in order to charge higher prices, often disguised as transportation, administration or handling charges.

�To keep up with construction schedules, local builders are being forced to pay more than RM2,000 a tonne for steel bars and we want a long-term solution to resolve this nagging problem,� Wong added.

--------------------------------------

Nik says : I would say that this is a good idea but I'm sure we would like to see real implementation coming in.

Automatic price mechanism

THE implementation of an automatic price mechanism (APM) for the steel sector can be a �conducive� transitional move for the Government to consider while it looks into industries' growing concerns for a free market condition. Malaysia Iron and Steel Industry Federation (MISIF) president Tan Sri Soong Siew Hoong said that it was important to review the policy on controlled pricing for building materials, particularly on steel items, for the business viability of the steel sector.

�Under current conditions, we believe that it is strategically necessary to remove the Government price control, import and export restrictions on steel billets and bars,� he told StarBiz.

Soong said steel mills in Malaysia were operating at 60% utilisation capacity, although the situation was expected to improve next year with demand from projects under the Ninth Malaysia Plan (9MP).

�MISIF members, however, have greater concern on the issue of price control on billets and bars,� he said.

The making of both products, are dependent on imports of ferrous scrap, whose prices have been fluctuating due to the growing demand in China and elsewhere. Soong said the local steel industry imported about three million tonnes of ferrous scrap with prices ranging from RM210 per tonne in January 2006 to RM365 per tonne in December 2006.

�The gap between scrap prices and billets are becoming closer under current conditions,� he said.

Other than demand issues, the local steel industry is also affected by spiralling prices of materials, increasing energy costs, the strengthening of the ringgit against the US dollar, and national regulatory issues. MISIF, in its latest 2006 steel industry review, said steel companies were continuously seeking alternatives to scrap as feedstock. Production for long products marginally improved with an 18% increase in steel bar production, given better demand with the pick-up in the construction sector in the second half of last year. Production of most flat products also improved with hot rolled coils utilisation up to 79% and the producer, Megasteel Sdn Bhd, pushing production to 1.9 million tonnes per year. On apparent steel consumption, MISIF said consumption of steel grew by 7% last year after a decline of 8% in 2005.

�Growth was evident in long and flat products despite higher exports in both sectors.�

Soong said the local steel industry was adapting to the various changes at domestic and international levels. The sector, however, would need to pursue export volumes to support optimum production, he added.

---------------------------------------------

Nik says : The suggestions given are good ones.

Top steel millers want solution

TOP steel millers in Malaysia want to see an effective solution to bring the local sector back on par with its counterparts regionally in terms of pricing. An interim solution given the current conditions would be to adopt the automatic price mechanism (APM) while a long-term one would be the lifting of the Government-controlled price on steel bars and billets, steel millers said. Steel millers contacted by StarBiz felt that many countries in the Asia-Pacific region had no control policy on steel prices. Thus the prices of steel bars can quickly be adjusted to the record prices of scrap, the principal raw material used in South-East Asian mills.

The Lion group, which has three mills (Megasteel Sdn Bhd, Amsteel Mills Sdn Bhd and Antara Steel Mills Sdn Bhd), views the recent 20% hike in the ceiling price of steel bars and billets as �insufficient� to cover the production costs of steel mills as the cost of the raw material - scrap - had risen by 36% to US$380 per tonne currently from US$280 per tonne in 2004. Steel division marketing director Anthony Chin said: �The increase in steel bar price from an average of RM1,500 to RM1,800 per tonne is not reflective of international bar prices currently around US$600 or RM2,100 per tonne.�

The benefit of the recent price increase for billets and steel bars were mitigated by rising costs of scrap, consumables and utilities, he added. Chin said Amsteel and Antara Steel mills had been operating at 60% to 70% capacity similar to the other steel mills in Malaysia. Megasteel has been running at about 80% to 90% capacity utilisation while Antara's hot briquetted iron plant in Labuan, Sabah, has been producing at full capacity. In terms of capital expenditure, Chin said Megasteel was upgrading its facilities to increase its capacity from two million tonnes to 3.2 million tonnes per annum. He said new investments by the Lion group included a RM1bil direct reduced iron (DRI) plant in Banting, Selangor, with an annual capacity of 1.54 million tonnes of DRI, which is similar to hot briquetted iron as feedstock for steel-making.

Southern Steel Bhd financial controller C.B. Koay said APM should benefit the industry in the long run, as it allowed local steel prices to follow the upward or downward trend of international prices.

�Local steel millers will have to be efficient to tackle steel prices when they come down, and contractors will have to be able to handle the situation when steel prices rise,� he said.

Koay said: �We have laid down plans to increase production output over the next few years.�

Effective this month, China is imposing export duties on certain steel products coming out of the country.

�Such a move would discourage exports and raise the price of Chinese steel products in overseas. This will reduce the competition that we face from Chinese steel products,� he added. Koay said Chinese exporters of certain steel products such as steel bars and wire rods also no longer enjoy �subsidies� such as the export rebate on value-added tax.

�This should enable regional steel producers like Southern Steel to compete with Chinese products on more equal footing,� he added.

Ann Joo Resources Bhd executive director Datuk Lim Hong Thye said the revised prices of steel bars and billets were lower than the international steel prices.

He said: �I believe steel bars represent just a small fraction � about 5% to 8% � of the construction cost (excluding land).� Lim said the steel bar price was not something that steel millers planned to artificially jack up. �Despite the volatile international steel prices, local millers had to wait for almost three years before the Government revised ceiling price last month.�

While contractors and developers were allowed to import, he said, �many are reluctant and prefer to take advantage of the lower steel prices in Malaysia.�

To date, 70% of Malaysia's scrap metal requirement for steel was fully imported, Lim added.

Choo Bee Metal Industries Bhd group general manager Au Hah Chye said the general consensus was that steel prices had peaked and were stabilising. He said price movements, if any, were likely to be marginal in the short term. Outlook for the mid-term is that prices should still be firm, especially with China's reduction in export tax rebate. Choo Bee plans to increase exports to Singapore while exploring opportunities in Australia and West Asia.

Amalgamated Industrial Steel Bhd chief operating offer Allen Tee said the Ninth Malaysia Plan would spur business activities but with the Asean Free Trade Area and World Trade Organisation in place, the whole scenario and business landscape had altered, introducing more competition locally. The risks for steel pipe manufacturers include no alternative supply source, competition within the country, price cutting given too many producers and external competition in the form of influx of imported pipes at prices lower than local steel pipe makers' costs.

-------------------------------------

Nik says : I wish it's as easy as the analyst say

Analyst: Steel issue delicate

THE availability of strategic construction materials, especially steel and cement, is crucial for the country to realise the benefits from the Ninth Malaysia Plan (9MP) and to ensure a robust real estate market. As a result of prevailing uncertainties in the pricing and the availability of these materials, contractors and developers have to plan way in advance their material needs and have contingency plans to cushion against unexpected price escalation and inadequate supply. To hedge against any unexpected price escalation, most of the bigger construction groups and prudent contractors, upon been awarded contracts, would have locked in the price of construction materials, especially critical materials. Although such practices will further raise the cost for industry players and affect their profit margins, it is a good safeguard rather than being caught unawares in the event of escalating prices and supply shortfall. While the rollout of the 9MP projects over its implementation period (2006 to 2010) looks positive for the construction sector to revive from the slowdown, the steel issue may jeopardiseproject implementation.

An analyst with AmResearch said the steel issue had grown very delicate and the Government needed to manage it properly.

�Steel is an important component of all construction and property projects, comprising between 10% and 25% of total construction cost.�

He said while decontrolling the steel market would allow a free and transparent market, the flip side would be that users might end up paying a much higher price than the government controlled price because of escalating prices in the international market.

Master Builders Association Malaysia president Patrick Wong said the failure to source for adequate supply of steel bars and billets at the new Government-controlled price would affect project schedules and result in cost overruns. While industry players who are building for the Government may be covered under the escalation clause that takes into account any cost overrun, those who are undertaking private contracts may have to absorb any cost overrun from project delays and escalating material costs. Although such practices will further raise the cost for industry players and affect their profit margins, it is a good safeguard rather than being caught unawares in the event of escalating prices and supply shortfall. While the rollout of the 9MP projects over its implementation period (2006 to 2010) looks positive for the construction sector to revive from the slowdown, the steel issue may jeopardise project implementation.

An analyst with AmResearch said the steel issue had grown very delicate and the Government needed to manage it properly.

�Steel is an important component of all construction and property projects, comprising between 10% and 25% of total construction cost.�

He said while decontrolling the steel market would allow a free and transparent market, the flip side would be that users might end up paying a much higher price than the government controlled price because of escalating prices in the international market.

Master Builders Association Malaysia president Patrick Wong said the failure to source for adequate supply of steel bars and billets at the new Government-controlled price would affect project schedules and result in cost overruns. While industry players who are building for the Government may be covered under the escalation clause that takes into account any cost overrun, those who are undertaking private contracts may have to absorb any cost overrun from project delays and escalating material costs.

Real Estate and Housing Developers Association president Ng Seing Liong said the call for a long-term solution to solve the recurring problem was most timely.

�The Government should give due consideration to the appeal by the various trade groups to allow industry players to import steel bars and billets.�

He said the Government was in the best position to investigate the actual production by the millers and the total tonnage that had reached the local end-users.

�This way, we will be able to identify the source of this problem, which has badly affected many developers who are unable to source for sufficient steel bars even while they are paying at the newly revised price.

�Any further delay will result in more dire consequences to project progress, cost and cash flows,� Ng added.

While developers of upmarket projects are in a better position to review their property prices in subsequent launches, those whose projects are not well sought-after may not be able to up their price in order to attract sales.

�If the projects have already been launched, the developers do not have a choice but to move on with their projects,� he added.

Property developers concurred that any further delay in handling the shortage issue would severely affect their project schedule and cash flow. Another analyst with a foreign brokerage said steel millers would not be using up their excess capacity for now as the high metal scrap prices had affected their margins. He said the disparity between the government-controlled price and the international price was the main reason for the inadequate local supply as millers preferred to export their supply to the world market.

�Although in the short term developers are able to adjust the timing of building roads and other infrastructures in their schemes, a practical and long-term solution is needed to ensure adequate supply of critical construction materials at all times,� the analyst said.

Real Estate and Housing Developers Association president Ng Seing Liong said the call for a long-term solution to solve the recurring problem was most timely.

�The Government should give due consideration to the appeal by the various trade groups to allow industry players to import steel bars and billets.�

He said the Government was in the best position to investigate the actual production by the millers and the total tonnage that had reached the local end-users.

�This way, we will be able to identify the source of this problem, which has badly affected many developers who are unable to source for sufficient steel bars even while they are paying at the newly revised price.

�Any further delay will result in more dire consequences to project progress, cost and cash flows,� Ng added.

While developers of upmarket projects are in a better position to review their property prices in subsequent launches, those whose projects are not well sought-after may not be able to up their price in order to attract sales.

�If the projects have already been launched, the developers do not have a choice but to move on with their projects,� he added.

Property developers concurred that any further delay in handling the shortage issue would severely affect their project schedule and cash flow.

Another analyst with a foreign brokerage said steel millers would not be using up their excess capacity for now as the high metal scrap prices had affected their margins.He said the disparity between the government-controlled price and the international price was the main reason for the inadequate local supply as millers preferred to export their supply to the world market.

�Although in the short term developers are able to adjust the timing of building roads and other infrastructures in their schemes, a practical and long-term solution is needed to ensure adequate supply of critical construction materials at all times,� the analyst said.

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Builders and millers at odds over steel price

By ANGIE NG and HANIM ADNAN

WHILE developers and contractors want the Government to scrap the ceiling price of steel and allow users to import their steel needs, steel millers are asking for an automatic price mechanism (APM) to decide the price of the material. In the long-standing dispute, both the users and suppliers are at loggerheads over the price mechanism and are asking for market forces to dictate the price. A source close to the steel industry revealed that over the past week, there have been active dialogue sessions between Domestic Trade and Consumer Affairs Ministry officials and trade associations representing the steel millers, developers and contractors. It is learnt that they are hoping to find a long-term solution that is agreeable to both parties. Stressing that the industry would face a serious crisis should the situation prolong, trade groups representing the users urged the Government to take a proactive and practical approach to resolve the issue. They claimed they could not get adequate supply of steel bars of certain sizes despite paying the recently revised ceiling price of RM1,962 a tonne. In a united stand to alleviate the situation, the Real Estate and Housing Developers Association (Rehda), Master Builders Association of Malaysia (MBAM), Malaysian Malay Contractors Association, Malaysia Indian Contractors Association and the Associated Chinese Chambers of Commerce and Industry of Malaysia have urged the Government to lift the price control and import control on steel bars and billets until the situation stabilises.They called for the exclusion of steel bars and billets from the Price Control Act 1946 (Act 121) and Control of Supplies Act 1961 (Act 122) to allow their price and supply to be determined by market forces. Meanwhile, the steel millers' main complaint is related to the 30% to 50% surge year-to-date in the price of the main raw material - scrap metal - that is fast eating into their operating margins. They want the Government to reconsider the proposals by the Malaysia Iron and Steel Industry Federation (MISIF) in 2004 for the industry to adopt the APM. Under the APM, the prices of billets � a semi-processed product � and steel bars would be pegged to the price of scrap metal. The millers believe that the APM would be the best long-term solution for controlling the price of steel, which is seeing wide price fluctuations in the world market. They said that while it would safeguard the profit margin of the steel millers when the price of scrap metal escalated, it would also cause steel prices to come down when scrap prices came down. (The APM is similar to the current pricing mechanism for the price of petrol. The oil companies adjust the petrol price to the oil price. However, the consumer does not see these adjustments because petrol is subsidised by the Government - if the oil price goes up, the Government, not the consumer, pays for the increase.) The top five steel millers which produce steel bars and billets are Lion Group's Amsteel Mills Sdn Bhd, Southern Steel Bhd, Ann Joo Steel Bhd (formerly Malayawata Bhd), Kinsteel Bhd-Perwaja Steel Sdn Bhd and Malaysia Steel Works (KL) Bhd. Speaking for the user group, Rehda president Ng Seing Liong said the present price control system was ineffective as users were still unable to source for adequate supply to meet their needs despite paying the higher Government-controlled price. Steel demand is expected to increase further with the buoyant property market and the roll-out of infrastructure projects under the Ninth Malaysia Plan (9MP). Ng said that before industry players could reap the benefits of the recent government incentives for the property market, the steel shortage issue was threatening to negate all the efforts carefully put in place so far.

�While we look forward to the many opportunities from the various Government incentives, we need to keep the momentum going by offering the right products; but this will be hampered by the steel problem,� he added.

Sunway City Bhd senior managing director Datuk C.K. Wong said with the rapid globalisation of the world economy, allowing free market forces of demand and supply to decide the commodity price would be an effective long-term solution to resolve the recurring steel shortage problem. MBAM president Patrick Wong said in view of the many projects to be awarded under the 9MP, major infrastructure projects could also be affected if the situation was left unabated.

�A more reliable supply is necessary to ensure the smooth implementation of the 9MP projects.

�Otherwise, smaller contractors may even be forced to close down and this would derail many of the projects. A worst-case scenario will be project abandonment,� Wong added.
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nikzafri



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Posts: 119

PostPosted: Sat Jan 12, 2008 12:37 pm    Post subject: CONSTRUCTION METHOD STATEMENT & JOB SAFETY ANALYSIS-NikZ Reply with quote

Posted: 07 March 2007 at 2:28pm

forumer wrote:
What is the difference between Work Method Statement & JSA?


If you're referring to Malaysia, I do not what's the logic in differentiating between Work Method Statement (WMS) and Job Safety Analysis (JSA). (in manufacturing - WMS is equivalent to Work Instruction (WI)

Principally; to me; they are very much the same - both talk about the right way of doing work. Unless you take out the word 'Work' and replaced by 'Contruction' or 'Installation' (in front of 'Method Statement' thus making it "Construction Method Statement" (CMS) - despite it may hold a bit of a different meaning (construction metholodology) - but still WMS talks about working methods while CMS talks about 'what you're building' or what you are working on.
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forumer via PM wrote:
Q: what are the differences btw pre tender method statement and submission method statement ??


Hi back to you...

I would appreciate if you could do me a small favour.An informal introduction perhaps? Your real name, where are you working, as what and what's the question for...no hard feelings eh..I make this quite clear to every forumer.

In principle, Pre-Tender Method Statement is a requirement to be submitted in advance as per requirements in tender documents - set by the client to see what you have planned/capable of prior to being selected as the main or sub-contractor.

Submission Method Statement is a contractual requirement (usually during pre--construction/planning stage) usually requested by the client (sometimes together with sample & drawing submissions*) prior to site mobilization.

Thanks

Additional Points :

* may include PQP, POSH, or EMS, ITP, Scheduling etc.

The answers given depend on many situations.

i.e. : Type of Contract - conventional? Design & Build? Turnkey? PFI?

The bidding party - are they the Main Contractors? Sub-Contractors? Consultants**? (working for Main Con or Client?)

** Project Management, M & E, C & S etc.

Remember, different scenario has different way of approach. (generic)

In most cases, method statements are submitted PRIOR to site mobilization or during 1st kick-off meeting at site where clients may attend.

But I find the latter not a good practice as construction/setting-out & survey activities maybe delayed should the clients reject the method statements. Thus, it is proper to submit the method statements (and/or Inspection & Test Plans, PQP, Sample) PRIOR to site mobilization - this reflects good planning.

As for the Pre-Tender stage, I have seen some clients do that but what if the bidding contractor failed to get the tender? Will the clients return the Method Statements? I would recommend if this is the case, the clients should only ask for List of Method Statements and during Tender and Contracts/Post Tender interview sessions, they can determine the capability of the contractor by asking the contractor to brief on certain construction methodologies based on such list.
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nikzafri



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Posts: 119

PostPosted: Sat Jan 12, 2008 12:38 pm    Post subject: TQM IN MALAYSIAN GOVERNMENT CIVIL SERVICES - Nik Zafri Reply with quote

Posted: 05 March 2007 at 9:56pm

Question by : ayreal12

Hi to all the forum members ,

First of all, I am Wan, an undergraduate quantity surveying student.
Im seeking advice and opinion from all regarding the TQM implementation in our public and private construction sector.

would you suggest a few companies that i can conduct an interview with? or should i just give out the questionnaires ?

Opinions are most welcomed

thanks in advance Smile
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Posted: 06 March 2007 at 4:03pm

Nik Zafri's Response

Hi ayreal12 a.k.a Wan

The Government of Malaysia have been practising TQM since the early 90s - if I'm not mistaken - it's 1992 (based on my very own experience consulting/training the civil services for many years since - 1995) - whether they realized it or not. - But the Civil Services Circulars during that time are self-explanatory and still relevant. Some (there's a lot more) of what they have been implementing are (but not limited to) QCC techniques, PDCA, Desk Files, SOPs Manual, Client's charter, Objectives etc. etc. (ISO 9000 came later into the civil services - 1995 -1996 and later fully implemented until now)

On Civil Services/Government TQM, you can definitely reach the following agencies :

a) Malaysian Administration Modernization Plannng Unit (MAMPU)- Prime Minister's Department - this is where the circulars originated.

b) National Institute of Public Administration - INTAN

c) National Productivity Centre - NPC - is very popular for various awards of productivity & quality (event the construction industry) including Prime Minister Quality Award which is almost similar to Malcolm Balridge Award (using modern TQM criterions - almost Knowledge Management, i called it) - among others benchmark to Data Measurement/Analysis & Continual Improvement, 7MP tools/7 new QCC tools etc. etc.

On private sector - you can only approach any US-based manufacturing/other industry in Malaysia, e.g. Motorola, Texas Instruments etc. You can also try Microsoft. Although you may bump into unfamilar phrases to TQM like 6 Sigma, Knowledge Management, Business Process Reengineering etc., don't bother - they come from the same thing - TQM.

The setback that you are likely to face if TQM assignment of yours has something to do with the Malaysian construction industry - as you are a QS (yes, I'm still aware that you wanted something to do with the construction industry). Majority of the construction industry in Malaysia resort to ISO 9000 and not TQM (at least not totally) but you can still have some basic ideas as well - just find any construction firms being certified wth ISO 9000 and you''re 'in business'...(tips - don't look too much into the ISO elements but look only for TQM practices similarities - e.g. Data Analysis, Preventive Acton (not corrective), Customer Satisfaction, Competence/Awareness & Training (Human Resources) etc. And don't forget the ISO 9004:2000 - 8 Management Principles as these principles have been based on TQM as well)

I will say the same thing to ALL students here - be it 'matured students' or not - you should be visiting the 'Knowledge Management' thread in this forum or do some 'data mining' (read all threads and extract some ideas) together with the Construction Quality Management old/ancient posts...there are 'tonnes' of information that can help you out if you are willing to 'work hard' (in fact - all QS friends of mine are very hard workers - you know with BQ's, Design Drawings, S-Curves, Calculations etc. - you can't afford to make too many mistakes). Less but not least, you are also welcomed to visit my 'portal' as well but most articles are in Bahasa.
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nikzafri



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PostPosted: Sat Jan 12, 2008 12:40 pm    Post subject: Reply with quote

Posted: 07 February 2007 at 5:21pm

Question by kmeechin

Hello everybody^^

Currently i am working in a construction company that its' main activity of project is Sewerage Treatment Plant (STP). This company is a Sdn Bhd company.

I was work as an Accounts Exe. but previously i havent touch any part of construction link... therefore, i have no idea how project managers manage their costs and profits...


I am interesting to know more in new line of work environment. Therefore, i wish to know some of the basis things that a small contractors that they are commonly did for a project.

Here are some questions which i work out to gain more knowledge and has more understanding in construction line...

1. How a project manager estimate and manage a project costs?

2. How they control the cash flow problem? Are they also have a statement like accounting which is record the cash in and out?

3. How they recognise the revenue and expenses?

4. How they manage the time to finish work by work? Is that they use the microsoft project to control the work period for each work? and if the work have been delay, how they going to do? was they claim from client less?

5. Is there any formula to calculate the construction costs?

6. Normally in accounting, in the construction contract topic, i always see the sencentences of "% of work completion", "recognised profit & loss", "progress in billing"... but i am wondering why this comapny i work didnt not touch on this part. Is that small company like Sdn Bhd normally is exempt for these part??

7. How they budget the direct & indirect costs? and also the labour costs?

8. What is mean by C&S, M&E work?

9. How the taxes charge to the project?

10. How manager mark-uo the contract price? How the control and make sure the contract price they issue is lower than other contractor?

I am very talkative person... feel shy when asking lot of questions...

I just wish to understand more about this industry...

thank you everybody~~ Bye
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Posted: 07 February 2007 at 8:03pm

Nik Zafri's Response

It's rather bizarre for an accounting person not linked into the construction industry especially when you have to look into 'Payments and Claims' - your job; by right should also interlink directly to Project Management especially Quantity Surveyors/Procurement where the last part usually goes back to you.

Correct me if I'm wrong, your queries also sound like you're doing a theses or research or something?

Ok, if you look carefully, avid/detail reading in the last posts, you will find a link to 'Project Management'.

I'll try to attend to your queries - that is if my busy schedule didn't stop me first.
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Posted: 07 February 2007 at 8:21pm

Response by ahvincent

Well said Nik, as an accountant you don't worry too much about the nuts and the bolts, you worry about the ringgits. One of the most important aspects of any project is cash flow. The best project in the world is no good if there is no cash.

As the project goes into the construction phase, besides the "white collar" profession of architects & engineers, the "blue collar" tradesmen comes into the equation, you start to have piling contractors, form workers, steel fixers, concrete pouers, electricians, plumbers, hydraulics etc.....

Project Management is a profession by itself. A succesful manager is a highly respected and very important member of any construction team.

Perhaps if you belanja Nik a cuppa of teh tarik, he can educate you more in 1 hour than 6 months in skool. Honest complement.
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Posted: 08 February 2007 at 1:57am

Response by almerica

Hi, Let me try to see how it can be made simple

Here are some questions which i work out to gain more knowledge and has more understanding in construction line

1. How a project manager estimate and manage a project costs? Cost estimates are based or derived from a combination of various specialized division costs eg - from the procurement (purchasing) dept it will be based on the costs of materials required to carry out the project. The costs for these has to have some slight buffer or allocations for potential wastages, etc. From the contract division (quantity surveyor) they will provide estimated costs required based on the drawings and plans provided to them by the architectural and engineering division. So as a project manager, technically speaking you are to liase with all these various divisions to get their respective costing to derive at your total project cost estimates.

2. How they control the cash flow problem? Are they also have a statement like accounting which is record the cash in and out? Cash flow is something that should be managed and worked out by the accounts dept which shall provide information to the project manager as to what are the budgeted costs allocated for the respective purchasing, contracts divisions, etc so that it does not endanger the profitability of the project. That means they must buy accoridng to budget and the project manager should be the "police" to ensure that they do. For every project, a project account is a must which means that all expenses and revenues for that certain project must be separated and should not be lumped together into the company's common accounts because there if they do that, then the costs incurred that ar not related to the project may reflect that the project is losing money when it actually isn't.

3. How they recognise the revenue and expenses? Revenue for construction based projects I believe should be based on the sales collected from buyers (if your company is a developer). If your company is a contractor the revenue is of course the payments your company receives from the party which appointed your company to do the construction works. Expenses of course if for whatever is spent to construct the project.

4. How they manage the time to finish work by work? Is that they use the microsoft project to control the work period for each work? and if the work have been delay, how they going to do? was they claim from client less? A work schedule normally done in excel file. The project manager must sit down with the various divisions and work out their timeframe and schedules required to finish their respective scope of work and then the project manager is to compile and create a working schedule chart to ensure that the flow of work that is dependent on one another (eg you cant arrange for labour if your materials have not arrived, so you gotta know when the materials are going to arrive and plan the labour according to the time). Work do get delayed so therefore when you plan the schedules provide some extra days of buffer in case things go wrong. For material delivery if they are late then you could impose LAD (liquidated assessed damages) on them, meaning that they will be fined for delays in material delivery.

5. Is there any formula to calculate the construction costs? Every different material or scope of work have different formula. for example for labour it could be based on the labour cost per person per day, for other materials it could be by per square foot or per carton or per batch, etc. The amount required is determined by the various departments as mentioned earlier.

6. Normally in accounting, in the construction contract topic, i always see the sentences of "% of work completion", "recognised profit & loss", "progress in billing"... but i am wondering why this company i work didnt not touch on this part. Is that small company like Sdn Bhd normally is exempt for these part??
No it should be there. % work completion normally goes hand in hand with progress claims/billings, meaning when you finish one part of the job you claim for it, then move on to do the next part of the job. For development companies, which financing comes from the banks, it isthe same, the finish one part of thebuilding and so they can draw down a portion of the money from the bank.

7. How they budget the direct & indirect costs? and also the labour costs? As mentioned in (5). On direct costs it means that costs incurred that are related directly to the project. Indirect costs mean costs that are incurred on non construction areas to get the project done.

8. What is mean by C&S, M&E work? Civil & Structural / Mechanical & Electrical

9. How the taxes charge to the project? Depends on what kind of taxes you are referring to. Some taxes are incurred for materials that are imported, some taxes are incurred for services.

10. How manager mark-uo the contract price? Woh! Managers dont mark up the contract prices unless they want to make undercounter money! This is a no-no!

How the control and make sure the contract price they issue is lower than other contractor? Get a comparison from various suppliers, or do tenders.

I am very talkative person... feel shy when asking lot of questions... No problem, hope this helps.
---------------------------------
Posted: 08 February 2007 at 3:06pm

kmeechin's response

Thanks everyone~

Nik, yes! u are right... i am trying to research some information about construction which related to account...

As i mention previously, i an accounts Executive, but i forgot to tell you i am the only staff doing everything... what i mean is i need to do all the office works by myself such as adminstration, customer service, etc..

I just new in this company about 3mths i worked here...
My boss & other 2 project manager not frequently in the office... they always go to site.

Therefore, for me, i prefer to read & learn 1st... then only i start ask questions... I could asked some many questions because i try to read the "contract documents" for a project, but many sentences i cant understand...

Nik, since Ahvincent noted that if i belanja you then u will spend some time to teach me, izzit? hehe

I think my head become bigger and biggest already in the construction link... very complicated...

Anyway, i will try to handle this job if i think i still got the mood , if i think i'm not suit for construction line, then i may try to find other job lol...

But normally i wouldn't give up when i try to know something new~~

Still got 1 more question which i asked one of the project manager this morning. "Why some contractors will run away in half way of work?" whatever i heard was the contractors quoted their contract price low then they couldnt burden the loss, so they run-way, izzit?

Thank you everybody~ Thank for your information~ now i have more interesting to this link... Thanks again~~ keep in touch~ bye~~
---------------------------
Posted: 08 February 2007 at 7:13pm

Nik Zafri's Response

So you see kmeechin, the two greatest gentlemen in this topic already given you SOO many answers!

Eric...Great explanation!! Good!!

Ahvincent - good recommendation...teh tarik? OK...provided that Eric and yourself agree, we'll have the nice teh tarik in the vintage Coliseum of Kuala Lumpur (that is if ahvincent can catch his flight...)


kmeechin wrote:

"(don't understand) Project Management especially (linked to) Quantity Surveyors/Procurement"? [/i]


Again, if you look into Eric's answer :

almerica wrote:

Cost estimates are based or derived from a combination of various specialized division costs eg - from the procurement (purchasing) dept it will be based on the costs of materials required to carry out the project. The costs for these has to have some slight buffer or allocations for potential wastages, etc. From the contract division (quantity surveyor) they will provide estimated costs required based on the drawings and plans provided to them by the architectural and engineering division. So as a project manager, technically speaking you are to liase with all these various divisions to get their respective costing to derive at your total project cost estimates.


and

almerica wrote:

Cash flow is something that should be managed and worked out by the accounts dept which shall provide information to the project manager as to what are the budgeted costs allocated for the respective purchasing, contracts divisions, etc so that it does not endanger the profitability of the project. That means they must buy accoridng to budget and the project manager should be the "police" to ensure that they do. For every project, a project account is a must which means that all expenses and revenues for that certain project must be separated and should not be lumped together into the company's common accounts because there if they do that, then the costs incurred that ar not related to the project may reflect that the project is losing money when it actually isn't.


Come to think of it...I think Eric deserves the teh-tarik..hahahaha

kmeechin wrote:

"Why some contractors will run away in half way of work?" whatever i heard was the contractors quoted their contract price low then they couldnt burden the loss, so they run-way, izzit?


As a matter of fact, that's not the only reason although it is one of the typical reason - these kinds of contractors require a good accounting person like you to properly control planned budgetted cost/material prior to decision to tender. (Not having a nice Mercedez Benz and BMW using progress payments)

I beg to differ - It's not really about low price or high price but I believe strongly if you plan your budget/financial well, do some real genuine research, you could do it more 'cost effectively'. But some the contractors are a bit impatient, never want to research properly especially on the construction raw material price market - even if they do and even if they have the so-called network of suppliers/sub-contractors, they didn't bother to check the trend of what's going on around them - the possibility future price fluctuations/volatility in e.g. cement/concrete, steel etc. as a result of no price capping or world crude oil price or the problems the industry/manufacturers are encountering etc. So, sometimes, they DID quote at the right price but as a result of this 'unexpected circumstances', they have no choice but to run away or hoping for some rehabilitation/corporate debt restructuring plan from the financial institutions (IF the financial institution would want to help them)

I've seen contractors 'locking their raw material price' despite whatever happen during construction - they are still OK.

Another solution (for the client), is to ensure/insist that some form of financial guarantee is given first - BG, Bond etc. prior to site mobilisation.

This is another problem, since the client knew the contractor in the past, they took for granted that the contractor might not run away. So, they decided to 'delay' the monetary guarantee and guess what, after 2 months of getting progress payments, the contractor ABANDON the job! (just like that...) This has happened before..trust me.

To worsen/aggravate the matter further, the client tried to recover the losses through a new contractor to take over the abandoned job and make the new contractor pay more before starting the job. This somehow has led to cost-overrun (again resulting from improper budgetting or financial management - due to high enthuasism being awarded with 'new takeover projects').

Another issue a LOT sensitive...so, I don't think I will discuss here...(but I think Eric and Ahvincent can guess what it is)...let's just say..it has something to do with 'contigency'.

On claims and payments - I'm sure you've heard of these phrases before...at least one or two of them :

a. Interim Progress
b. Variation Order
c. Payment Certificate
d. Final Accounts
f. Retention Fund/Bond

Yes...quoting Eric...'budgetting' as well....e.g. effective budget also should take into account 'quality cost calculation' (also 'buried' in this threads..somewhere) or some auditors call it 'intangible'.

Based on your 'grievances'. I suggest you strongly to find a better job before it's too late (hehe - your boss would surely be 'pis**d' if he knew what I'm suggesting you to do)...I heard lots of big names like Gamuda, Sunway, IJM, Ranhill etc. even PMCs are always on a look for Accounts who knows the contruction industry - but not to the extend of becoming Engineers. Quoting ahvincent...yes..you do not have to worry about the technicalities..all you need is a bit of reading even to understand the 'theory'. That's how ALL accountants started when they work in construction industry.

But one thing for you kmeechin, the more you know the construction industry; in any capacity you are in; the more interesting and challenging it would be (ask eric..haha)

Ok..I'm not shy being a talkative person.
----------------------------
Posted: 08 February 2007 at 9:24pm

Response by almerica

I agree with Nik.

You see there are various reasons why contractors abandon ship. Sometimes it is their fault and sometimes it is not. The key to ensure that these incidences do not happen is open and fair communication between the contractor and the main con.

You see the contractor could calculate the costing wrongly and therefore runs at a loss and therefore finds that there is no other option but to "cabut". Ahvincent says that he should bear the losses and finish the job which is partially true only. What if he has no money any more to ensure that the job is done even at a loss?

Then we have the buaya main cons who may realise that the sub cons have made only minimal profits just to get the job and so because they are cheap, they are then appointed. And when the sub con really find it tough to do so, the main con insists that they do it with no other options given. It is their pockets they take care of and not the sub con's. Making money from other people's miseries has no issue of morality to them.

Today this is a very possible and serious issue.

Example :

A sub con is engaged to tender for a project in the last minute. He wants the job and so calculates say the cost of his goods (which could be imported) and decides he wants to make a profit of only 15%. Suddenly the currency exchange goes against him or the material is suddenly imposed a higher tax. Hoo boy, now he is caught.

So how do we solve this problem? Firstly both parties must ensure that a proper discussion be made before the contract is awarded. The sub con must make it clear to the main con on what should be done if say, prices suddenly go up due to any legitimate reasons. Will the cost be shared or borne by one party?

Also if nothing of this sort happens, then the main con will need to clarify with the sub con what happens if he delays wthout legitimate reasons? What should be done?

It is all about being open and pre-empt things that may or may not happen, get it clairifed, put it in writing and then go from there. Both parties now willingly understand the situation well and there will be no finger pointing.

The problem always arises because one party refuses to meet or talk rationally on the issue when a problem arises. Maybe one party tried but the other refuses to listen.

So the actual root of the problem is communication (during the pre-awarding process, during work in progress, and and after the job id done) and not taking advantage of one another....but then how often do we meet people who dont jump at the prospect of taking advantage of another's desperate situtaion. (sigh)

Trust me, there are many who jumps into signing a contract because he has spotted that the other party has made a mistake in costing or in any other area and then later on holding them ransom to it when the problem arises. They could have also pointed out to the sub con in the earlier stage to maybe allow them to get the problem rectified before signing but how many will do that? Instead they threaten them with lawsuits or other means and so the sub-con can do nothing but cabut!
----------------------------
kmeechin wrote:
This calculation apply to post tender... i think the budgeted costs are based on the costs estimated pre tender, izzit? For this statement i only fill in the column "payment made", other columns the project manager update himself... So i m not sure how he get the amounts... Plz comments, Thank you

(Note : Please read my following comments together with Almerica/Eric's comments/guide on

a. project management estimation, cash flow, revenue/expenses, milestones/CPM/S-Curve etc, costs of construction/labour/direct/indirect, taxation, quotation/price competitiveness etc. AND

b. ahvincent comments and assumptions on your formulation/calculation.

Yes; depending on circumstances; you are right to say that typical practice involved - budgetted costs to be estimated during pre-tender stage sometimes even before decision to pre-qualify (if applicable).

Again, this practice is usually done confidentially by a tender committee (which may hold the answers to 'where did he get the figure?' - but this is fine as long as they are justifiable to the company's external auditors) The committee during this stage would likely discuss :

a) scope of works - this is where you find Turnkey, Design & Build, Conventional or even PFI,
b) financial aspects - taking into account major material budget and quantity for budget control,
c) resources and
d) capability.

For successful tenders; although may not be a conventional practice; estimation is not only limited for contracts with quantities but contracts without quantities as well. For this purpose, I'll talk briefly on estimation without quantities to facilitate your understanding. (contract with quantities is clear cut)

a) usually there are drawings and specifications containing relevant information of the contract,

b) the drawings and specs are being carefully read and measured focussing on the aspects of structural quantities (including materials) and the total quantities of major items are being analyzed further.

c) Finally a BQ shall be formed.
---------------------
Posted: 13 February 2007 at 9:51pm

Nik Zafri's response

kmeechin wrote:
This calculation apply to post tender... i think the budgeted costs are based on the costs estimated pre tender, izzit? For this statement i only fill in the column "payment made", other columns the project manager update himself... So i m not sure how he get the amounts... Plz comments, Thank you


(Note : Please read my following comments together with Almerica/Eric's comments/guide on

a. project management estimation, cash flow, revenue/expenses, milestones/CPM/S-Curve etc, costs of construction/labour/direct/indirect, taxation, quotation/price competitiveness etc. AND

b. ahvincent comments and assumptions on your formulation/calculation.

Yes; depending on circumstances; you are right to say that typical practice involved - budgetted costs to be estimated during pre-tender stage sometimes even before decision to pre-qualify (if applicable).

Again, this practice is usually done confidentially by a tender committee (which may hold the answers to 'where did he get the figure?' - but this is fine as long as they are justifiable to the company's external auditors) The committee during this stage would likely discuss :

a) scope of works - this is where you find Turnkey, Design & Build, Conventional or even PFI,
b) financial aspects - taking into account major material budget and quantity for budget control,
c) resources and
d) capability.

For successful tenders; although may not be a conventional practice; estimation is not only limited for contracts with quantities but contracts without quantities as well. For this purpose, I'll talk briefly on estimation without quantities to facilitate your understanding. (contract with quantities is clear cut)

a) usually there are drawings and specifications containing relevant information of the contract,

b) the drawings and specs are being carefully read and measured focussing on the aspects of structural quantities (including materials) and the total quantities of major items are being analyzed further.

c) Finally a BQ shall be formed.
---------------------
Thus, you can safely assumed that the budgetted cost comes from pre-tender and the cost commited is derived from the tender/estimation/post tender stage whereby the latter stage - adjudication, repricing, bond, insurance etc. has been finalised. (but despite of this, I can't help noticing the volatility of 'planned' and 'actual' - some are totally accurate as planned and some with pretty big margin - which may be connected to 'mark-up' as suggested by Eric/Almerica as a BIG NO! )

What also may confuse anyone reading it - is the 'Payment Made' column (please counter refer to ahvincent's comments on calculation/assumption and my last 'e.g.' para on 'payable/receivable' before the 'p.s.' statement)

Here are some of the potential improvements :

The type of payments made can be properly justified further:

a. Interim/Progress
b. Variation Order
c. Contractual

The 'prelim' is quite clear but on 'Equipment' and C & S can be confusing.

and don't forget, the column may also be confused between account payable and receivable.(?)

e.g. 'payment made' can also be...payment made by your company to sub-contractor/supplier?

p.s. But kmeechin, all my statements issued herein come with a standard disclaimer - that despite every measure has been taken to ensure the best answers given based on my experience, yet I shall not be held responsible/liable for any inaccurate statements (as I'm not your company's consultant/auditor/project manager/qs etc. - thus, I may not know REAL PICTURE - only based on best assumptions) or any inaccurate applications using the information provided herein. The decision to utilise/not to utilise the information provided herein shall be done solely by the enquirer's discretion.
------------------------------------
Posted: 14 February 2007 at 10:34am

Response by kmeechin

Nik wrote: "Again, this practice is usually done confidentially by a tender committee (which may hold the answers to 'where did he get the figure?' - but this is fine as long as they are justifiable to the company's external auditors) The committee during this stage would likely discuss :

a) scope of works - this is where you find Turnkey, Design & Build, Conventional or even PFI,
b) financial aspects - taking into account major material budget and quantity for budget control,
c) resources and
d) capability."

Nik, what u mean by company's external auditor?? Is this auditor will assist the committee all the time from pre-tender until the final contract?

If a contract is only for 1 to 6 mth(s), was this contract also need external auditor's justification?
-----------------------------
Permit me to clarify & refresh:

In Wikipedia :

Audit - A financial audit is the examination of financial records and reports of a company, in order to verify that the figures in the financial reports are relevant, accurate, and complete. The general focus is on making sure that all assets and liabilities are properly recorded on the balance sheet, that the statement of income and expenses is correct.

The external (financial) auditing (once per fiscal year) is almost a MUST (most say A MUST not almost) by any company - usually Sdn. Bhd. and above if the company is genuinely practicing good governance especially transparency.

First of all, the (external) auditors hired by your company should know what kind of services that your company is providing.

Typically :

'Provision of Construction Services in (Design Management) Building and Civil Engineering Works"

'-ditto - of Architectural Services.....'
'-ditto - of M & E Services ......'
'-ditto - Project Management Services....'

The 'product' for 'construction services' are deemed as the 'projects acquired' - not each but ALL projects accumulated for each fiscal year whether short or long term, complete or still under construction - at the point of audit.

Thus it's not an audit for the project per se but for the company (company wide audit)...unless if in cases of due diligence or fraud, risk investigations, gap analysis - whereby it's triggered by a report by a certain party doubting or would like to 'reconfirm/reverify' certain transactions that may not be properly justified (even in the notes of accounts) or 'irregular' (against the normal procedures)

In Wikipedia :

Due diligence is a term used for a number of concepts involving either the performance of an investigation of a business or person, or the performance of an act with a certain standard of care. It can be a legal obligation, but the term will more commonly apply to voluntary investigations. In particular, due diligence is a process through which a potential acquirer evaluates a target company for acquisition.

In finance, due diligence is the process of research and analysis that takes place in advance of an acquisition, investment, business partnership or bank loan in order to determine the value of the subject of the due diligence or whether there are any "'skeletons in the closet'".

The potential investor generally uses in-house resources or hires a consulting firm that specializes in due diligence and corporate investigations to investigate the background and principals of the target company. Professional reports from accountants and solicitors will also frequently be included.

Due diligence can also refer to the ongoing activities of pension or investment fund managers in keeping track of the operations, solvency, and trustworthiness of the managers of a corporation in which their fund is invested, or those of the managers of an acquiring corporation toward a target corporation.


Taking into account the above brief explanation, in the case of confidentiality, it's not really confidential to the external auditors (perhaps to you and some others) - otherwise there'll be irregularities and imbalance in the final audit report (no proper justifications) and a follow-up may be required. So, it's the duty of the top management to justify 'where the figure comes from?' when enquired by the external auditors.

Confidentiality is usually maintained by the top management due to protect certain interest of the company e.g. from being 'leaked' to the competitors or other parties that would want to 'take advantage' - all external auditors usually deemed to work on Non-Disclosure Basis- it's an oath not to disclose any information to other 3rd party. So, the files of any clients 'stored' in the audit firm office ARE 'confidential'.

And of course, the external auditors are not working for you or the tender committee or any party in your company but they are hired to do a fiscal year financial audit...they are from 'outside'...not 'inside' the company... If there is such job for assisting the tender committee to the end - in terms of monitoring all financial aspects of your company, it should be the internal auditors and accountant or a finance personnel.
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nikzafri



Joined: 10 Jan 2008
Posts: 119

PostPosted: Sat Jan 12, 2008 12:42 pm    Post subject: Reply with quote

The Star-Global Malaysians Forum - Posted: 24 January 2007 at 12:02am

Question by tjhstar

Hi,

I am doing a research on the Malaysian New Property Market being in a situation of Asymmetric Information whereby the seller/builders take advantage of the fact that the buyer is not buying the house with full information. We have heard countless times of buyers not getting the property they have expected or in worse case, not even getting the property at all. One way to solve this problem is to implement the build to sell policy.

I was wondering if there are any websites or institution where I can find statistics for building defects or related information on the title I am doing.
----------------------------
Posted: 24 January 2007 at 7:46pm

Nik Zafri's Response :

In Malaysia, it's very difficult to find the defect list either from Govt/Pte Sector except if you can approach the developer/contractor themselves - but I doubt that they would easily provide you with the list due to the fact that such record despite your assurance of confidentiality) may be used against them and could also disrepute them as well (defect can sometime lead to quality and safety issues)

Thus, if you can't get the defect list, it's foreseeable that you can't also get the classification of defect data and by trade data analysis (analysis by types of defects - or better known as statistics).

On the issue of property, I think you have addressed the problem very well.

It's about responsibility and accountability of the developers. On the other hand, the legal practitioners should also explain clearly complex clause e.g. entitled 'Defects Liability Period' (or equivalent) & not only including the rights of the buyers but also what kind of defects that 'qualify' the buyers to lodge a complaint and be attended to. Thus, the legal person must get info from the developers themselves and never talk 'law' or 'too technical' with the buyers.

It's not something surprising these days that certain buildings are being given CF and CMGD with 'built-in defects' - all in a package. Thus, the buyers; led to believe that everything is OK having seeing certs; they don't even bother to check until they moved in. But if it's true that everything is OK, then why the number of complaints still arising on the quality/workmanship? (I also come to understand there are courses on the rights of buyers/developers but yet the same problem still persist)

The cooperation from all relevant parties are required to ensure the smooth implementation and enforcement of the law.

You can also slowly browse through this topics, more information on DFL, CF, CMGD could be found where the forumers including myself have formerly discussed. Additionally, I have also many months back inserting few hyperlinks from US/Malaysia (some in English, some in Bahasa Melayu) , something to do with common defects, penalty etc.

I hope you will find them handy.

http://www.constructiondefects.com/cd_defectslist.asp
http://www.kpkt.gov.my/kpkt/main.php?Content=sections&SectionID=146

Cheers/Good Luck
-------------------------------
Posted: 25 January 2007 at 12:37am

Response by tjhstar

Nik,

Thank you for your opinions. I have found some information on the National House Buyer Association and they have a pretty concise information and also newspaper articles on issue of property defects. I also took a look the the housing ministry website. There are some statistics but I feel they are lacking in detail and depth.

The issue here is that I need to convince my lecturer who is a foreigner, that there is such a problem in Malaysia and to do that, I need some solid figures and facts.

I guess I will just have to make do with what I have.

Thanks again for your feedback on the issue.
-------------------------------
Posted: 27 January 2007 at 5:47pm

Nik Zafri's Response

The honour is mine actually. I'm glad that the links I gave you helps. The problems with some statistics are that they are too generalized and not been properly 'broken down' probably to the 2nd level analysis by trade defects. And furthermore the 2nd level analysis + 3rd level analysis by how much cost/time being spent on repairing is still 'vague'. Although there's data around (ask a true project management consultant or quantity surveyor..they would be able to tell you where it is) but it's not being taken into account when doing these 'statistics'. It's like two sets of systems when it's only supposed to be one.

Thus, we could assume that the action plan taken to prevent future recurrences/occurrences are based on undocumented experience and definitely not really based on what they see on statistics. THAT's why; in a word of a process/trade auditor; the same trend keep happening!

In short, there are such problems...believe me...being a 'quite a senior guy' in the construction industry. What you can do in order to get 'some solid figures and facts' are that you would have to do your very own 2nd level and 3rd level analysis and give you best assumptions and don't forget the action plan (I know that your lecturer will like it)

On the buyer's side, you should consider my humble suggestion in the last post.

Good luck my friend.
-------------------------------------
Posted: 29 January 2007 at 4:08pm

Hai

My name Khairul Noorazmi Minhat. I'm doing architecture at UTM Skudai . I'm very impressed with topic you all discuss and every point were relevant and reality. And it is good with a help from proffesional.

Actually got an assingment according to CIDB contract form. Through my reading(actually i just read the CIDB form once) the CIDB contract form are focus in Design&Built contract and it were compile in 3 different type of form (correct me if i'm wrong)

-CIDB standard contract form for building work
-CIDB contract form for Design & Built
-CIDB contract form for sub-contractor

I would like to ask about :

1.the differences between CIDB contract form with PAM form
2.Issue relating to CIDB contract form ( the application in construction industry)
3.The application of the CIDB contract form in other type of contract
4.Any clear refferences -book or website

I hope u guys can help me share ur information. sorry for any inconvinient. Thank you.
-----------------------
Posted: 29 January 2007 at 9:28pm

Nik Zafri's Response

Hi, Khairul (by the way ahvincent - CIDB stands for Construction Industry Development Board)

Please accept my apologies in advance - frankly speaking, I can't accurately guess what you're referring to. Perhaps it would help if you could visit http://ww3.cidb.gov.my/corporate/index-en.html - you will also see http://ww3.cidb.gov.my/registration/form-en.html (Please indicate which form?)

In terms of authority/scope of work, CIDB and PAM are different from one another.

CIDB is basically in charge of boosting the construction industry via new construction methodology/technology, publications and grading/registration of contractors (civil, building, structure, mechanical, electrical etc including construction personnel) & sometimes most of their 'projects' may involve teaming up with other government/semi-government organization/bodies/agencies e.g. SIRIM, DOSH/NIOSH, JKR/IKRAM, even PAM, IEM/BEM, etc. (depending on which issue that we're talking about - e.g. if it's about construction safety and health assessment thus the teaming up would be between SIRIM/NIOSH/CIDB) - However, CIDB do not overlap another body.

Refer to : http://ww3.cidb.gov.my/information/tech/tech-my.html

You can also try to contact CIDB Directly by :

http://ww3.cidb.gov.my/corporate/feedback.php?lang=en_US

While PAM is the Malaysian official architectural board/association open for membership/registration/certification and this organization ensures that everyone works according to the rule/regulation/law (e.g. Uniformity Building By Law) and standards - http://www.pam.org.my
-------------------------------
Posted: 16 February 2007 at 7:10am

Comments by exoticman

Hi Nik - fully agree with you but I think the bucks stops with the people who keep and watch those standards in the contructon industry. I would believe that there are simple measures tha would look at:

-- Fall Protection
-- Scaffolds
-- Electrical Safety
-- Materials Handling
-- Excavations
-- Personal Protective Equipment
-- Ladder Safety
-- Forklift Safety
-- Permit-Required Confined Spaces.

The "watchdogs" as I called them should stop if those safety standards are not met and also carry out unannounced inspections. I would assume that those issued with prohibition notices, which require an immediate stop to work while improvements are put in place?

I do not know much about the construction industry but out of common sense, I would presume that the above would apply.
------------------------------
Posted: 17 February 2007 at 1:29pm

Nik Zafri's Response

Hi J/exoticman

The criterions you've mentioned are exact matchings to :

a) OSH/FMD Laws
(b) OSH related Standards/Codes of Practice,
(c) Safety Manuals, JSA, Plans and Procedures
d) Safety Inspection Checklist

Well, I dare to say that AT ALL LEVELS - from the authorities to the contractors - everything is already in order EXCEPT despite there is data-analysis activity but only to the extent of having nice figures/charts but NO Action Plan.

If there IS such so-called Action Plan, they should be revising the plans; as clearly, the Plans ARE NOT effective. Otherwise, the rate of recurrence of the very same safety problems should have been down to a minimum a long time ago, not keep repeating in a short period of time (take the landslide case as a good example)

In conclusion, it's the human attitude to be changed and NOT factors (a) - (d) abovementioned.
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