Saudi Arabia to adopt new mechanism set to compensate contractors
The Saudi Contractors Authority’s (SCA) Chairman Osama Al Afaleq was cited by Okaz newspaper as saying that SCA is working with the Council of Saudi Chambers and related bodies to set up a mechanism for compensating the firms that signed contracts with the government prior to Dec 2016. The mechanism will also compensate the contractors that won bids on projects before that date. The compensation will cover the delayed payments to contractors on a monthly or quarterly basis, instead of the current mechanism, which pays contractors after a project’s completion, he said. Al Afaleq also said the compensation will also reduce the impact of the combined bill, as firms have been affected by having to pay the expat workers’ fees in advance. He added that paying for workers’ licences in advance disrupts the Saudisation process and has a negative impact on several sectors, including contracting.
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