Gyeonggi Provincial Office increases the rate of down payment and instigates earlier payment to help alleviate contractors’ financial burden
Createdd 2003-06-19 Hit 5949
The recent decision by Gyeonggi Province Construction Headquarters to increase the rate of down payment and instigate an earlier payment plan, as part of a strategy to help contractors deal with a current spate of economic difficulties, has received wide praise within the industry.
Under the new guidelines for down payment by local autonomous bodies concerning public projects, which was put into force in May, contractors need only to submit an expense breakdown sheet in the final stages instead of submitting expense plans or having to undergo a process of settlement every month. Thanks to the drastically simplified procedures, local autonomous bodies will be allowed to pay a maximum of 70% in down payment (up from 20∼50% in the past) depending on their specific financial situation.
As for the progress payments made every three months, Gyeonggi Province Construction Headquarters put into force a simplified procedure for payment so that contractors can get paid every month.
With such drastic measures for earlier down payment and monthly progress payment, contractors can now be relieved of much of their financial burden. One contractor said that it felt like a rain shower after a long spell of drought.