Improvement In Dealing With Construction Permits Indicator

The Malaysian government is continuously working towards providing better services for the public and the business community. An initiative by the Special Task Force to Facilitate Business (PEMUDAH) is to focus on upgrading the quality of existing regulations to improve the efficiency in Dealing with Construction Permits. The World Bank Doing Business Model uses a case study on building a simple commercial warehouse in the capital city of Kuala Lumpur to examine the procedures, time and cost for a business to obtain the required approvals. In the World Bank Doing Business Report 2012, Malaysia was ranked 113th out of 183 countries, compared 111th in the 2011 Report for the indicator on Dealing With Construction Permits.

In the recently published Doing Business Report 2013, Malaysia registered a marked improvement in this ranking to 96th position. It was noted by the World Bank that Malaysia has made Dealing with Construction Permits faster by improving the one-stop-centre for obtaining approvals for low-risk projects such as building a simple commercial warehouse. The coordination between the Kuala Lumpur City Hall (DBKL) in-house technical departments and external technical agencies has reduced the number of procedures and the time taken to obtain the required approvals.
 

Public consultation with stakeholders to get feedback on new submission model in dealing with construction permits, 3 April 2012, in Kuala Lumpur

The Focus Group in Dealing with Construction Permits (FGDCP) has conducted a thorough study to identify regulatory and non-regulatory options that are able to reduce burdens placed by the regulators to business community in dealing with construction permits. The introduction of OSC1 Submission as a special lane to get approvals will now require only 10 procedures and take 100 days to process the approvals as compared to 37 procedures which required 140 days.

Previously Principal Submitting Person (PSP) had to go through 37 procedures to submit development application in Kuala Lumpur.

Steps of submitting development application through OCS1Submission at DBKL by Principal Submitting Person

BOX ITEM - BASELINE STUDY IN DEALING WITH CONSTRUCTION PERMITS

Malaysia Productivity Corporation together with Ministry of Housing and Local Government and Ministry of Federal Territory and Urban Wellbeing have conducted a baseline study to map the processes of Dealing with Construction Permits in 15 cities throughout Malaysia. The study focuses on the case of setting up a Petronas Petrol Station in 15 cities in the states of Malaysia. The scope of study involves the impact of local and national regulations on small to medium-size domestic firms in dealing with construction permits. It identifies differences in the enforcement of local and national regulations that could either enhance or constrain local business activity.

Mapping process to understand process of getting construction permits in Putrajaya 6-7 September 2012

Mapping process to understand process of getting construction permits in Kuching 3-4 Otober 2012

Key findings on Dealing with Construction Permits (ranked from least burdensome to most burdensome using the World Bank Ranking Model).

Note: Rankings are the average of the economy’s rankings on the procedures, time and cost to comply with formalities to build a petrol station
Source: MPC Baseline Study in Dealing with Construction Permits in Capital Cities and Improving in Dealing with Construction Permits in Kuala Lumpur

The study shows that Kangar requires 20 procedures and 80 days with a total cost of RM6,691 to rank top of the group. The most expensive place in Dealing with Construction Permits is in Georgetown, where a petrol station owner has to pay RM407,814. Dealing with Construction Permits is least burdensome in Kangar, Kuala Terengganu and Kota Bharu. It was most burdensome to businesses in Ipoh and Georgetown.