Selecting Key Final Materials to Prevent Stakeholder Intervention in Construction Company Bidding
Supervisor-Approved Materials Converted to Reported Materials... Construction Supervisors Excluded from Material Evaluation Meetings
[Asia Economy Reporter Jo Gang-wook] Korea Land and Housing Corporation (LH) announced on the 28th that it will implement the "Construction Material Selection Management Innovation Plan" starting from the 1st of next month to enhance fairness and transparency in the material selection process used in housing construction projects.
This plan was prepared to fundamentally block corrupt practices such as bribery suspicions at construction sites and interference by internal and external stakeholders during the material selection process. It consists of three main items: △ mandatory selection of major material suppliers during contractor bidding △ conversion of approved construction materials to reported materials △ strengthening transparency of finishing material evaluation meetings.
Mandatory Selection of Major Finishing Materials During Contractor Bidding
First, the method for selecting major finishing materials used in construction will be changed. Previously, major finishing materials were selected and used by LH after reviewing whether the materials proposed by the contractor after commencement met quality standards. However, from now on, during the bidding for construction projects, bidding companies must compulsorily submit a "Major Finishing Material Selection Plan" and a "Commitment Letter from Selected Suppliers" for 26 types of major finishing materials used in the project.
The selected companies must use the materials from the manufacturers specified in the submitted Major Finishing Material Selection Plan during bidding. If intentionally not complied with, penalties such as issuance of a quality deficiency notice will be imposed. However, in cases of force majeure such as bankruptcy or insolvency making production or delivery impossible, the material manufacturer can be changed immediately upon occurrence of the reason.
The scope of application covers all housing construction projects conducted by LH. LH plans to reflect and notify these changes in the bidding announcements for housing construction projects bidding after August 1st to ensure immediate implementation of the revised content.
Conversion of Approved Construction Materials to Reported Materials
The scope of reported materials in housing construction projects will be expanded.
Materials used in housing construction projects are classified as "approved materials" and "reported materials." "Approved materials" are major materials closely related to the durability of structures such as structural parts, insulation, fire resistance, and inter-floor noise, requiring approval from the construction supervisor for use. "Reported materials" have minimal quality variation and are easy to secure quality for; they can be purchased through the Public Procurement Service and can be decided and used by the contractor as long as they meet quality standards such as KS and specification criteria without supervisor approval.
LH has significantly increased the proportion of reported materials that contractors can decide on from the previous 67% to 94%, reducing the number of approved materials to diminish the authority of construction supervisors in the major material selection process. In particular, materials such as tiles and wallpaper, which are not closely related to durability among the existing approved materials, have been converted to reported materials.
Strengthening Transparency of Finishing Material Evaluation Meetings
LH construction supervisors will be excluded from participating in finishing material evaluation meetings conducted to decide finishing materials included in housing sale announcements.
Finishing material evaluation meetings have involved LH personnel and contractors as internal and external stakeholders to select finishing material designs for each housing supply trade. However, to fundamentally block the possibility of retired personnel or others intervening in finishing material selection through LH personnel, participation of all trade supervisors related to the construction, including architecture, mechanical, and electrical trades, will be prohibited.
Accordingly, future evaluation meeting committees will be composed of about 20 members, including internal members from housing business-related departments such as sales, asset management, and rental supply, excluding the construction supervisors, as well as external members such as trade supervisors from supplier companies and staff from interior design firms.
LH will immediately implement the construction material selection management innovation plan to strengthen monitoring of the entire material selection process and plans to promptly improve the system whenever corruption-prone structures or issues are discovered in the future.
An LH official stated, "Through this improvement plan, we will fundamentally block the intervention of internal and external stakeholders that may occur during the material selection process. We will continue to identify and improve problems that may arise during the material selection process to eradicate corruption."
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