Contractors can claim losses in government projects

Contractors can claim losses in government projects
Web posted at: 10/2/2009 1:48:51
Source ::: The Peninsula
By MOBIN PANDIT& MOHAMED SAEED

DOHA: Contracting companies handling state projects can now claim compensation for delayed payment or delays in project implementation due to modifications in design or any other technical reasons.

Similarly, contractors fined for delaying a project due to genuine reasons will now be able to request for leniency or a waiver.

Also, firms supplying materials to state agencies can make claims for compensation if they suffer losses due to sudden spurt in import costs or due to any other genuine reason.

A committee has been set up in the Ministry of Economy and Finance that would look into claims and compensation requests from contractors on the above or any other ground.

The move follows assurances given by the Prime Minister and Foreign Minister H E Sheikh Hamad bin Jassem bin Jabor Al Thani at his interface with local businessmen at the Doha Sheraton recently, that such concerns of contractors would be looked into.

The Emir H H Sheikh Hamad bin Khalifa Al Thani yesterday ratified a Cabinet decision (No. 38 of 2009) ordering the setting up of the aforesaid panel at the Ministry of Economy and Finance. The Undersecretary at the Ministry in charge of financial affairs will head the committee, while one of the two Ministry officials to be nominated by the Minister to be on the panel, will be its vice-chairman.

The panel will have representatives from various ministries and state agencies, including the Ministry of Municipality and Urban Planning,Ministry of Justice and the State Audit Bureau.

These bodies will be free to nominate representatives of their choice and each of them will be paid a monthly honorarium of QR4,000. Membership tenure of the panel will be three years which would be renewable for a year or more.

There will also be provisions for altering an agreement with a contractor if a project is delayed for any reason.

The panel has been asked to put adequate regulations in place to organise its work, but is required to meet at least once every fortnight at the Finance Ministry premises. It has been entrusted with the authority to form technical sub-committees to ensure smooth functioning.

Cases already in court will not be entertained and those who do not accept the ruling of the committee will, however, be free to move the judiciary. Through another decision (No. 39 of 2009) ratified by the Emir yesterday, ministries and government agencies have been empowered to award project, purchase or service contracts of up to the maximum value of QR200,000 on their own. For such contracts, direct agreement with a party concerned can be signed by a government entity.