chapter 6 - Malaysia Productivity Corporation ( MPC)

Box 4.2: Improving Efficiency in Dealing with Construction Permits in Kuala Lumpur
A
construction permit system is a set of laws, regulations and procedures issued by the respective
Local Council that all building practitioners, such as builders, architects, consultants and
contractors, have to abide by when engaging in the construction of a new building or in the
modification of an existing building that has structural implications. A construction permit
grants legal permission to start construction of a building project. It is granted by Kuala Lumpur City
Hall (DBKL) and it enforces Building by-Laws (Building Code) that has been adopted as part of a broader
construction law.
The main objective of construction permits is to ensure the health and safety of the community. This has
important implications for policy-makers who need to strike the right balance between the cost imposed
on industry and the real benefits in safety and health standards.
The construction permit process plays a critical “gate-keeper” role in protecting a range of other public
goods such as preventing construction close to airports and protecting the environment or preventing
potentially harmful industries to be located in residential areas. These public goods are more fragmented
and are not related to structural properties or the risks directly associated to the structural characteristics
of the building. When this “gate-keeper” function is not carefully managed and coordinated with the
relevant authorities, an insurmountable bureaucracy may emerge which is likely to discourage investment
and increase the level of informality.
Carefully managing the “gate-keeper” role is an important factor in the success of improving efficiency
in dealing with construction permits in Kuala Lumpur. The objectives of modernising regulations in
Kuala Lumpur is primarily driven by the needs to improve safety, improve the performance of building
practitioners and transform the authorities to a more efficient enforcement body.
In addition to a main “Building by-Laws”, the practitioners have to follow other code of practices (standards)
focusing on specific engineering areas such as:
• Plumbing;
• Sewerage;
• Fire prevention systems; and
• Telecommunication.
58 Productivity Report 2011/2012