THESIS ABSTRACT

Abstract

Construction industry is the backbone of the country for the infrastructure development. The construction project is considered as an important sector for the development of the country. In the construction project, the payment process is an important element. The aim of this research is “analysis of payment delay in construction projects of Rasuwa district, Nepal”. Rasuwa district of Nepal is selected as a study area for this study. The objectives of the study were achieved through two approaches, the first one was a literature review about three main parts; causes of payment delay, effects of payment delay and possible mitigation measures of causes of payment delay. The second one was a valid questionnaire that was obtained from Rasuwa district construction project contractors, owners and consultants opinions. Sixty-six questionnaires were distributed to contractors, owners and consultants through the google forms. Among sixty – six questionnaires, forty-six (69.69%) questionnaires were received. Microsoft Excel – 2016 was used to analyze the collected data. The factors that contribute to causes of payment delay on construction projects were divided to three groups such as owners related factors, contractors related factors and consultant related factors. It had shown that “contractors related factors” was the most important group factors. Results of contractor related factors have indicated that “failure to agree with the valuation of work”, “failure to do work based on bill of quantity” and “contractor submitted claims with mistakes” were most their important factors that cause the payment delay in the construction project of Rasuwa district. Results have shown that “delay in evaluation of the contractor claims” and “lengthy process in Governments departments” were the most two important “owner related factors” that cause the payment delay in the construction project of Rasuwa district. Also, results have shown that “slow processing of variation orders” was the most important “consultant related factor” that cause the payment delay in the construction project of Rasuwa district. The effect of payment delay on construction projects were divided to four groups. Results have shown that "effects on contractor" was the major important group. Results indicated that the effect “late payment of salaries” and “difficult to procure material and services by the contractors” were the major effects on contractor group. The result also showed that “delay in having the expected benefit of property” and “delay in completion of project by the vi contractor” were major effects on the owner’s groups. However, “cost of consultancy services increased” was the most important effect on the consultant group. Due to the late payment, the result showed that “extension of project time” and “rise of project cost” were the major effects on the project characteristics group. From the study, contractors should submit timely accurate invoices with complete documents” and “defined time frame for payment” are found as an effective mitigation measures of payment delay. This study recommended the contractors to be financially strong before beginning projects and to submit timely accurate invoices with complete documents. The owners are recommended to work within stipulated budget putting in bank account before starting the project execution and to revise/review the bid documents such as technical specifications, drawings, bill of quantities and the design of the project before tendering in a good way with no/minimum errors. The consultants are recommended to review and approve design documents, working drawings, and the payments schedule of contractor to avoid any delay or cost overruns at the project. This study suggested that the boundaries of the study widened to include all the Nepali construction industries.

Keywords

Payment Delay, Effects, Mitigation Measures, Construction Project, Extension of Project Time