Covid-19: Neighbourhood upgrading projects, renovations delayed or scaled down due to higher construction costs

• Members of Parliament (MPs) whom TODAY spoke to said there have been various delays to their neighbourhood projects
• Some have even had to scale down their upgrading projects to keep to their allotted budget
• MPs are hoping that construction costs will fall as the Covid-19 situation here stabilises
• One contractor said he is avoiding public housing projects due to this uncertainty

SINGAPORE — Renovation and construction costs have increased by 20 to 50 per cent because of the manpower crunch in the construction industry and this is affecting not just homeowners but town council upgrades, too.

Members of Parliament (MPs) said upgrading projects have had to be scaled down or delayed, and one contractor said her company avoids taking on Housing and Development Board (HDB) projects for now as it is too hard to quote a budget given the delays.

Bukit Panjang Single Member Constituency (SMC) MP Liang Eng Hwa said that the cost of construction for upgrading works in his ward, such as for covered walkways and drop-off points, has gone up by 10 to 35 per cent.

Due to the rise in costs, some projects that were supposed to start earlier have been delayed by “a few months”, said Mr Liang.

However, if the projects are essential, such as barrier-free access for wheelchair users, the delay cannot be too prolonged.

“Some (projects) we still have to carry out, even though the cost is higher,” he said.

The issue of rising renovation and construction costs was brought up by MacPherson SMC MP Tin Pei Ling in Parliament in July.

She had asked how the pandemic had impacted construction costs in Singapore, and how public estate upgrading and construction projects would be affected by this rise.

In response, Minister of State for National Development Tan Kiat How said that construction costs have increased due to higher foreign manpower costs as Covid-19 border measures had limited the inflow of foreign workers, as well as due to the reduced productivity brought about by safe management measures at work sites.

He added that the cost of construction materials had also increased.

Mr Tan gave the assurance that the increase in costs of estate upgrading works will not be passed down to homeowners.

He also said that for neighbourhood renewal programmes (NRPs), town councils are encouraged to “work within budget and reduce upgrading items if necessary”.

DELAYED NEIGHBOURHOOD RENEWALS, HOME IMPROVEMENTS

Speaking to TODAY, Ms Tin said that for her ward’s NRP, which included the upgrading of walkways, the lowest bid for the project by a construction firm was already higher than expected.

“If we were to still keep to the budget, we would have to eliminate some of the items planned under the NRP,” she said, estimating that the scope of the project would be cut down by a third.

“The NRP was really meant to either address some of our residents’ requests over the years or to make sure that the environment is better for residents of all ages… it will be painful if we have to strike off too many items.”

At Radin Mas SMC, there has also been a 30 per cent increase in construction costs for the projects there, according to its MP Melvin Yong.

The upgrading of the ABC Brickworks Hawker Centre was delayed by a month, and he said he had appealed to the Ministry of Trade and Industry and the Building and Construction Authority to resume work at the site.

Tanjong Pagar GRC Joan Pereira said the NRP at Bukit Merah View was delayed for approximately eight months.

For East Coast GRC MP Jessica Tan, the Home Improvement Programme (HIP) for her Changi-Simei ward was first announced last April, but the implementation of safe management measures had delayed its progress “by several months”.

The HIP seeks to improve the internal living environment of HDB flat owners, by addressing some of the common maintenance issues in older flats such as spalling concrete.

SOME MPS HOPING CONSTRUCTION COSTS WILL FALL

Some MPs are also delaying their projects for now in hopes that the construction costs will fall in the coming months as the Covid-19 situation here stabilises.

Tampines GRC MP Desmond Choo said that there had been delays in upgrading works at his ward’s Community Club and at Tampines Round Market and Food Centre, both which were supposed to start at the end of last year.

He said that he had pushed some of these upgrading works “further down the pipeline” as he thinks that the increase in construction costs will be short term.

“It is a block of 12 to 15 months whereby production of (construction) materials slowed down, so it’s much better to avoid this period of time,” he said.

“Once we have reached a much higher level of vaccination, this will give construction companies more stability, and we can see if we can bring forward some projects.”

Similarly, Ms Tin from MacPherson SMC is also hoping that the Covid-19 situation will stabilise and bring costs down.

"(The increase in construction cost) is caused by macro factors that are beyond everyone, we understand that fully, so we will just hold back the project for now, see whether things stabilise,” she said.

“If we proceed now, there are too many items that we have to take out (so) we’re postponing for a bit and see whether the cost will come down or not.”

TODAY has also reached out to MPs from the Workers’ Party on whether rising construction costs have affected projects in their wards.

AVOIDING PUBLIC HOUSING PROJECTS FOR NOW: CONTRACTOR

Director of Adf Construction Foong Yu Han, whose firm takes on repair and redecoration projects in HDB estates and condominiums, said that four to five workers at her firm have left for home every month since the start of the year.

“The foreign workers haven't seen their families for two to three years, so they want to go back… but no one is coming in,” she said.

Due to the uncertainty surrounding construction costs during this period, the firm is not taking on public housing projects at the moment.

The scope for such projects is usually greater compared with those for private property, as there are more blocks. HDB projects could take up to 18 months, and in that time the shifting regulations due to Covid-19 would make it difficult to estimate a budget, Ms Foong said.

Renovation works have also increased, due in part to safe management measures at work sites.

Director of home renovation firm FincHaus Julia Wee said that the cost of materials had increased by 10 per cent, while the cost of labour had increased by as much as 20 per cent.

She added that the usual time taken for a full home renovation used to be two months pre-Covid, but during this period it would take four months.

She said that working with safe management measures had contributed to the increased costs and delays. Up to five workers can work in an empty house, but have to take shifts of two workers at a time.

When the homeowner is in the house, only two workers are allowed to work on the renovation project.

“Due to this, the prices will jump,” she said. “Profits will be affected, but we have no choice.”