1. Presentationby Construction Association of Bhutan

2. Construction Association of Bhutan 25 April 201525 April 201525 April 2015 Summary of Points 1. Publication of BSR 2. Allocation of Contract durations 3. Departmental Execution of Works 4. Publication of Construction Cost Indices 5. Tendering Issues 6. Cost of Tender Documents 7. Informing the bidders in case of re-tendering 8. Compensation for cancellation of work award

3. Construction Association of Bhutan 25 April 201525 April 201525 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.

4. Construction Association of Bhutan 25 April 201525 April 201525 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.

5. Construction Association of Bhutan 25 April 201525 April 201525 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

6. Construction Association of Bhutan 25 April 201525 April 201525 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

7. Construction Association of Bhutan 25 April 201525 April 201525 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 under- absorbed.

8. Construction Association of Bhutan 25 April 201525 April 201525 April 2015 3. Department Execution of Works Submission:  CAB would like to request the government to contract out all works to the private sector.

9. Construction Association of Bhutan 25 April 201525 April 201525 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.

10. Construction Association of Bhutan 25 April 201525 April 201525 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.

11. Construction Association of Bhutan 25 April 201525 April 201525 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.

12. Construction Association of Bhutan 25 April 201525 April 201525 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.

13. Construction Association of Bhutan 25 April 201525 April 201525 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)

14. Construction Association of Bhutan 25 April 201525 April 201525 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

15. Construction Association of Bhutan 25 April 201525 April 201525 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.

16. Construction Association of Bhutan 25 April 201525 April 201525 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.

17. Construction Association of Bhutan 25 April 201525 April 201525 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.

18. Construction Association of Bhutan 25 April 201525 April 201525 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.

19. Construction Association of Bhutan 25 April 201525 April 201525 April 2015 Tashi Delek!