A framework for combating payment-related issues (PRI) in the Malaysian construction industry

Abstract

Payment problems in the Malaysian construction industry are sensitive issues in nature and have relatively increased in number in recent years. In the Malaysian context, there are a number of research’s which have investigated on the causes of payment related disputes and it can be comprehended that, payment-related issues are increasing in number from year to year. The objective of the paper is to highlight on the current scenario on payment-related issues in Malaysia and to identify the dire determinants of in ensuring that payment is made on time. A questionnaire survey have distributed to the G7 contractors registered with the Construction Industry Development Board (CIDB) and Client representatives from Real Estate & Housing Developers' Association Malaysia (REHDA). The data obtained was analysed using inferential statistical techniques and the means derived were compared for each type of payment-related issues across different groups of respondent. The findings of the research is expected to help to fill the gaps between theory and practice towards payment-related issues in the Malaysian construction industry and will be useful to the key players in identifying the determinants to ensure on time payment. If the issues of payment in the Malaysia are not managed efficiently, it will create cash flow problems and unnecessary financial stress to the unpaid party.