Banks Too Must Be Penalised For Abandoned Housing Projects

bernama.com 19/4/2006

PETALING JAYA, April 19 (Bernama) -- The Selangor Menteri Besar Datuk Seri Dr Mohamad Khir Toyo said banks must be more alert in making progress payments for housing projects.

Banks must be proactive and they must go to the field to monitor the progress of the housing schemes before making any payment as this would help in avoiding abandoned housing projects.

"The banks should only pay according to the work progress. Often bank officers don't conduct checks. When developers send the claims they just pay," he told reporters after officiating Seri Jati Apartments here Wednesday.

Often the developers use the money for other purposes and in the end they could no longer continue with the housing projects.

He said the Housing and Local Government Ministry should amend the current laws to penalise banks that overpay progress payments.

Meanwhile Mohd Khir expressed his disappointment with the professionals in the construction industry who fared miserably in their roles.

He said at the end of the day the government is the one which becomes the target for public criticism when construction projects fail to meet the desired results or riddled with problems.

He reminded them that they have to carry out their role with full responsibility as they are being paid to do the work.

Dr Mohamad Khir said the state government had blacklisted several consultants involved in shoddy work.

However he did not state the number.

-- BERNAMA