Transcript Construction Association of Bhutan

Presentation
by
Construction Association of Bhutan
Summary of Points
1.
2.
3.
4.
5.
6.
7.
8.
Publication of BSR
Allocation of Contract durations
Departmental Execution of Works
Publication of Construction Cost Indices
Tendering Issues
Cost of Tender Documents
Informing the bidders in case of re-tendering
Compensation for cancellation of work award
Construction Association of Bhutan
13 April 2015
1. Publication of BSR
Problem Statement :

BSR is published only after few years time.

Un-realistic rates in the BSR

Cost index calculation is not carried out properly and on
a project specific basis. Rather some fixed cost index is
used all year around.
Construction Association of Bhutan
13 April 2015
1. Publication of BSR
Submission:

BSR may be published annually

Instead of three base towns, Phuntsholing,
Samdrupjongkhar and Gelephu, the rates be may be
published for Phuntsholing, Thimphu, Bumthang and
Trashigang.

The work of compilation and publication of BSR may be
tendered out to the private sector and accordingly
approved by the government.
Construction Association of Bhutan
13 April 2015
2. Allocation of Contract Duration
Problem Statement :

Contract durations are fixed on an arbitrary basis

Some contractors are provided with very relaxed Contract
durations while the contract durations of some
contractors are un-reasonably constricted.

Various factors affecting the implementation are not
considered while framing the contract durations
Construction Association of Bhutan
13 April 2015
2. Allocation of Contract durations
Submission:
The following factors needs to be considered while allocating
contract durations :

climatic conditions of project site (conditions during rainy
season and winter season)
 project location (remoteness, transportation of materials)
Availability of materials (materials availability in third
countries)
Complexity of project (installation of heating system etc,)
 Mobilization of resources
Construction Association of Bhutan
13 April 2015
3. Department Execution of Works
Problem Statement :

Dzongkahgs executing farm road constructions

Field Divisions of Department of Roads are executing
rehabilitation works departmentally.

Contractors mostly at Class C and Petty are underabsorbed.
Construction Association of Bhutan
13 April 2015
3. Department Execution of Works
Submission:

CAB would like to request the government to contract out
all works to the private sector.
Construction Association of Bhutan
13 April 2015
4. Publication of Construction Cost Indices
Problem Statement :

Bhutan doesn't have our own cost indices to calculate cost
escalation

Some projects use Whole Sale Price Index of India which
may not reflect the Bhutanese Scenario.
Construction Association of Bhutan
13 April 2015
4. Publication of Construction Cost Indices
Submission :

The government need to mandate one relevant
organization to compile construction cost indices on a
monthly basis.
Construction Association of Bhutan
13 April 2015
5. Tendering issues
Problem Statement:
Un-uniform application of rules as listed below:

Bid is not opened in case of single bidder
 Bids are rejected for simple reasons
 Qualification criteria applied for works up to Nu. 5
million.
 Extra criteria are set such as requirement of proprietor
to be present at the bid opening.
Construction Association of Bhutan
13 April 2015
5. Tendering issues
Problem Statement:
Un-uniform application of rules as listed below:

Bid is not opened in case of single bidder
 Bids are rejected for simple reasons
 Qualification criteria applied for works up to Nu. 5
million.
 Extra criteria are set such as requirement of proprietor
to be present at the bid opening.
Construction Association of Bhutan
13 April 2015
6. Cost of Tender Documents
Problem Statement:

Different agencies are setting varying cost of tender
documents

Some procuring agencies are setting un-reasonably high
cost of tender documents (as high as Nu. 20,000.00)
Construction Association of Bhutan
13 April 2015
6. Cost of Tender Documents
Submission :

To have a uniformity in setting cost of tender documents.

To charge minimal cost covering for petty expenses
Construction Association of Bhutan
13 April 2015
7. Informing Bidders while re-tendering
Problem Statement:

Re-tendering is often imitated by procuring agencies

Bidders are not informed after a decision has been made
to re-tender.
Construction Association of Bhutan
13 April 2015
7. Informing Bidders while re-tendering
Submission :

Bidders may be informed right after a decision has been
made by the tender committee to re-tender.

This would enable the bidders to collect their bid security
and prepare accordingly for the next biding.
Construction Association of Bhutan
13 April 2015
8. Compensation for Cancellation of work
Problem Statement:

Sometimes work award is cancelled due to inability to
secure funds for the work

It becomes a case of complete lapses of the client.
Construction Association of Bhutan
13 April 2015
8. Compensation for cancellation of work
Submission :

Bidding may be initiated only after securing the funding.

The winning bidder needs to be fairly compensated in
case of cancellation of work award.
Construction Association of Bhutan
13 April 2015
Tashi Delek!
Construction Association of Bhutan
13 April 2015