Comparison of GDP and Inflation: Japan and Thailand

Comparison of GDP and Inflation: Japan and Thailand Thailand   Ã‚   That have 2 main trends will be discuss. First one is the trend during years 1996 to 1999. From years 1996 to 1999, it was a period that Thailand created the Asian financial crisis and faced the recession from the crisis until the economy recovered. In 1996, Thailand was facing export stagnation because a decline of demand from First World countries, and also opening domestic markets to outside money brought a deluge of short-term foreign investment and spurred heavy short-term borrowing from abroad, fueling a building boom (http://www.encyclopedia.com/doc/1G2-3406400060.html). Thailand baht was fueled by refugee capital and it was the starting of Asian Financial Crisis (http://www.economist.com/node/9432495). As a result, Thailand GDP was fallen down due to the lost confidence of investors and the stagnation of export, but that was recovered quickly. IMF’s Executive Board approved financial support for Thailand of up to about US$4billion over a 34-month period (IMF staff, Jun e 2000). Thailand government also apply monetary policy to stable the exchange rate and fostering the economy recovery, and fiscal policy to restructuring the economy. In 1998, Thailand GDP returned to positive growth. The second trend is years 2008 to 2010. Thailand was facing political crisis during this period. The anti-Thaskin protesters, known as Yellow Shirts, stage protests for several months since May 2008, and they occupy two airports on November 2008 (CNN news, May 19 2010). The protests activities were continuous until 2010. During years 2008-2010, the Thailand economy being affected that the number of tourism, the number of export and most of the government budget spent on the safety and restoration of damaged by Yellow Shirts. Thailand experienced negative growth of economy after the Asian Financial Crisis. It make many investors and tourism was getting away from Thailand market. In year 2009, the Global Great Recession made double strike on Thailand economy. Japan Japan economy was facing Lost 20 Decades from year 1990 until 2010. Japan was one of the best countries to grow Japan economy in 1980s. This period was also creating high real estate price and soaring Nikkei stock market. The Bank of Japan decide to tighten its monetary policy in year 1989, then soon the Nikkei stock bubble popped and this lead to pop real estate bubble (Jesse Colombo, June 2012). Japan experienced economic stagnation in the following years based on the GDP calculation. The main reasons of prolonged stagnation of Japanese economy in year 1990s was the stagnation of investment and stagnation of household consumption due to the decline of household wealth, stagnation of household disposal income, and the uncertainty about the future (Charles Yuji Horioka, March 2006). Bank of Japan implemented zero interest rate policy in year 1999 to boost the economy but the situation has not improved greatly. Then, Bank of Japan introduced the quantitative easing policy in year 2000 (Yutaka Kurihara, 2014). Quantitative easing policy grab much of attention of investors and the investment start to return to capital of Japan. Japan is ready to recover the economy since the internal growing of Japan is quite high that they consist of lots of information about advanced technologies and higher production of their export area, although Japan was facing high debt-to-GDP ratio which is 225.9% in year 2010. Comparison Thailand seem like had a higher GDP growth rate than Japan which may means the Thailand economy is better than Japan. However, Japan experienced Lost 20 Decades during 1990 to 2010. The GDP of Thailand also unable surpass Japan and also the potential growth of nation is lower than Japan too since Japan keep advanced technologies sector even in the period of Lost 20 Decades. For the current period, Japan is recovering their economy after the Lost 20 Decades. Thailand Thailand reach two peak of inflation rate in year 1998 and also 2008. In 2 July 1997, Thailand float Thai baht and this lead Thai baht value devalued as much as 20% a record low (History Squared, 2011). This lead the Asian Financial Crisis, most of the Asian countries were involved in this crisis and led to inflation in year 1998. Most of the Asian countries currencies were fall and led the price level rose in the period. After that, Thailand inflation rate decreased sharply by year 1999, and Thai government lower the interest rate that short-term interest rate fall to 2% in 1999 from 23% in the year 1997 in order hope to boost economy (Economic Reform in Thailand, 2013). The second inflation rate peak was placed on year 2008. It was financial crisis happened on year 2008, the price of oil rose 800% since 2006 until mid-2008 (Clifford Krauss, 2008). This led price of other commodity also increase in the period until the bubble of commodity burst. The combination of an economic crisis and soaring U.S. dollar would cause commodities prices to plunge as in 2008, when commodities prices imploded by nearly half in a mere five month (Jesse Colombo, 2015). It led deflation to Thailand in year 2009 since many commodities prices fall sharply. After the crisis passed, the economy return to supply and demand level. Japan In the period of Lost 20 Decades that Japan experienced, the decreasing rate of inflation was happened in Japan. Japan government keep their effort to prevent deflation during Lost 20 Decades. That had few causes to make Japan suffer in deflation so long time. Surplus in savings, government policy mismanagement, structural impediments, Yen appreciation and global capital flow were considered as the causes that prolonged Japan economy recover period and led to deflation due to the research of Daniel I. Okimoto. In 1997, Japan experienced the peak of inflation rate. It was the Asian currencies crisis period since most of the Asian countries also been affected by devaluation of currencies. In April 1997, Japan government rose the consumption tax rate from 3% to 5%. The economy continued to deteriorate in 1998: the year 1998 recorded negative growth for the first time since 1976 (Takatoshi Ito and Andrew K. Rose, 2006). Japan economy was slowed down that led the people consumption lesser and lesser in Japan. Deflation was continuous until year 2002 that most of the investors believe that Japan passed the Lost Decades period and start to recover Japan economy. Unfortunately, Japan economy stagnation still going on in year 2002 until 2010 that Japan people consumption still low and they save more money in bank as a result of surplus in savings. Inflation rate increased in year 2008 was the result of Global Financial Crisis, which the US housing bubble burst, in the situation almost same as described above in Thailand. The Japan Lost 20 Decades was believed that is past in year 2010 which the GDP growth was positive and inflation rate increase in a safe frequent. Comparison Thailand has higher inflation rate growth compared with Japan. Inflation rate is meaning about a country’s growth due to the people could expense more in the period. Japan must face the inflation rate to boost the economy activities to recover the Lost 20 Decades for Japan. As the graph showing, Japan inflation rate was increasing from year 2010 until now, that means Japan has no more stagnation on their economy activities that they could boost the economy back to the standard. In contrast, Thailand was getting decreasing inflation rate from year 2010 to year 2013. Thailand unemployment rate increase due to the investments of foreign countries was shift to Indonesia or Vietnam, cheaper and higher skill labor force, that made Thailand people being poor and slow down their consumption during 2010. References: http://www.encyclopedia.com/doc/1G2-3406400060.html https://www.imf.org/external/np/exr/ib/2000/062300.htm#box1 http://edition.cnn.com/2010/WORLD/asiapcf/05/17/thailand.timeline/ http://www.thebubblebubble.com/japan-bubble/ https://ideas.repec.org/p/nbr/nberwo/12142.html http://www.todayscience.org/JFE/article/jfe.v2i2p77.pdf http://historysquared.com/2011/10/14/a-look-at-thailand-during-the-asian-financial-crises/ http://finance.mapsofworld.com/economy-reform/thailand/ http://www.nytimes.com/2008/10/14/business/economy/14commodities.html?pagewanted=all http://aparc.fsi.stanford.edu/research/causes_of_japans_economic_stagnation http://www.nber.org/chapters/c0092.pdf Construction Project Delay: Causes and Effects Construction Project Delay: Causes and Effects In this chapter, I will discuss types, causes and effects of delay of project in the construction industry. Besides that, I will also discuss the method to minimize the delays happening in construction industry 2.2 Type of Delay In construction industry, there are the categories of delays used in determining delay damage as shown in table 2.1 Figure 2.1 Types of Delay 2.2.1 Excusable delays Excusable delay as define a delay that is due to an unforeseeable event beyond the contractorà ¢Ã¢â€š ¬Ã¢â€ž ¢s or the subcontractorà ¢Ã¢â€š ¬Ã¢â€ž ¢s control. Usually, based on common general provisions in public agency specifications, delay resulting from the following events would be considered excusable such as fires, floods, owner-directed changes, errors and omissions in the contract drawing, unusually severe weather and etc. Excusable delays can be further classified into excusable with compensation and excusable without compensation. 2.2.1.1 Excusable with compensation Compensation delays are caused by the owner or the owners agents. An example of this would be the drawings late release from the owners architect. An excusable, compensable delay normally leads to a schedule extension and exposes the owner to financial damages claimed by the contractor. In this scenario, the contractor incurs additional indirect costs for both extended field office and home office overhead and unabsorbed home office overhead. 2.2.1.2 Excusable delays without compensation Non-compensable delays are caused by third parties or incidents beyond the control of both the owner and the contractor. Examples typically include acts of God, unusual weather, strikes, fires, acts of government in its sovereign capacity, etc. In this case, the contractor is normally entitled to claim extension of time but no compensation for delay damages 2.2.2 Non-excusable delays Non-excusable delays are cause by lack of performance of the contractor on the construction project. This delay can be cause by underestimates of productivity, improper project planning and scheduling, poor site management and supervision, wrong construction methods, equipment breakdowns, unreliable subcontractors or suppliers. Therefore, it is contractor responsibilities to continue their work with no entitlement to claim for extension of time or delay damages until they completed the project. For instance, a contractor failure to provide an adequate material to completed their job. 2.2.3 Concurrent Delay Concurrent delay is a problem that happening on most of the construction industry project. This issue arises when two or more delaying event at the same time in a project cannot complete on time. In this situation, both owner and contractor are responsible for the delay. Commonly concurrent delays which involve any two or more excusable delays result in extension of time. When excusable with compensation and non-excusable delays are concurrent, an extension of time can be issued or the delay can be distribution between the owner and the contractor. Concurrent delay can be categories in three types of delays: If excusable and non-excusable delays occur concurrently, the contractor only to allow claim for extension of time: If excusable with compensation and excusable without compensation delays occur concurrently, the contractor is entitle to claim extension of time but no delay damages: If two excusable with compensation delays occur concurrently, the contractor is entitled to claim extension of time and delay damages. For instance, a concurrent delay would be if the owner failure to give more detail regarding either using ceramic tile or homogeneous tile for toilet floor finishes. But at the same time contractor made with own decision and using ceramic tile for toilet floor finishes but actually owner plan using homogeneous tile. In this situation, the contractor cannot claim for damages. It is because contractor is not follow owner instruction but he can claim for extension of time with owner failure to give more detail of drawing 2.3 Causes of delays Figure 2.2 Causes of delays Based on the researched done through by journal, books, and some other reference. Project delay can be causes by a lot of parties which is shown in the Figure 2.2. They are include client, contractor, consultant, labour, material, equipment, financial and some external causes. 2.3.1 Caused of Client Related Delays Figure 2.3 Factors of client related delays 2.3.1.1 Lack of experience of client in construction According to Koushki, et al. (2005) identified factors of lack of experiences of client in construction project have high influence to the causes of delays. Some of the project delay cause by client due to not enough experience especially fresh developer. Most of the time, client facing a problem and do not know how to solve it immediately because of no experience. During client finding the way to solve the problem, some of the work could not progress. Finally, the whole project delay because of some particular work delay. 2.3.1.2 Change order According to Odeh and Battaineh (2002) mentioned the factors of change orders that contribute to causes of delaysà ¢Ã¢â€š ¬?. Client always change the design during the construction period, during the same time that will affect whole project delay. It is because contractor cannot carry out his work until the latest drawing issue by architect. Consequently contractor cannot be done within the contract period. Most of the current project delay because of change order by client. For instance, a project almost complete but client change certain part of design and instruct contractor carry out the additional work. After done the whole project, the contractor found out was exceeding contract period. 2.3.1.3 Client interference According to Long, et al. (2004) studied the factors client interference that contributes to causes of delays in construction project. Some of the client instruct contractor to carry out additional work without ask architect promise. During the contractor carry out additional work, some of the work could not progress and it will be delay immediately. On the other hand, client do not follow the procedure such as did not mention architect issue an architect instruction. Finally it will affect the whole project delay. 2.3.2 Causes of contractor related delay Figure 2.4 Factors of contractor related delay 2.3.2.1 Inadequate contractor experience Abd Majid and McCaffer (1998) studied the factors of inadequate contractor experience as contributor to causes of delays. Long, ET al. (2004) mentioned the factors of inadequate contractor experience that contribute to causes of delays in construction project. Battaineh (2002) identified the factors of inadequate contractor experience as contributors to causes of delays. In construction industry, some of the delay projects are facing a problem during construction period. But at the same time contractor could not solved the problem immediately because of no experience. During the contractor finding method to solve the problem, some of the works totally stop because of that problem. After the problem was solved, those work keeping continue but run out from the schedule. Finally, the whole project will influence delay. 2.3.2.2 Inaccurate time estimate According to Long, et al. (2004) identified the factors of inaccurate time estimating that contribute to causes of delays in construction project.à ¢Ã¢â€š ¬? Time estimates are important as inputs into other technique used to manage and structure for all projects. An inaccurate time estimation technique may cause a project delay. For instance, in some delay project, the contractor do not allowed time for some common problem always happen during the construction stage such as breakdown of equipment, miss deliveries by supplies, accidents and emergencies and so on. Because of this problem the actual time will run out from the estimated. So, the whole project could be facing delay. 2.3.2.3 Inaccurate of cost estimate According to Long, et al. (2004) also mentioned that, the factors of inaccurate cost estimating that contribute to causes of delays in construction project. Construction estimating errors can be very expensive and embarrassing. Inaccurate of cost estimate contribute a lot of cause such as wrong measurements from contract drawing, using incorrect units of measure, material improperly priced and the most common mistakes in arithmetic . Sometime contractor because of inaccurate of cost estimate measurement again for that particular work. Finally, due to re-measurement time some of the work will influence delay and it will also affect whole project to delay. 2.3.2.4 Poor site management and supervision Battaineh (2002) studied that, the factors of poor site management and supervision as contributors to causes of delays. Chan and Kumaraswamy (1996) identified the factors of poor site management and supervision that contribute to causes of delays. In construction industry, some of the project team a lack of management and supervision due team member without any experience and skill such as hire person who are fresh graduate. Once they facing problem but do not know how to solve it. Besides that, some of the supervisor did not cooperation with their team member due to lack of communicated. Finally, because of cannot solve the problem immediately the whole project influence delay. 2.3.3 Causes of Consultant Related Delays Figure 2.5 Factors of consultant related delays 2.3.3.1 Inadequate consultant experience According to Long, et al. (2004) studied the factors of inadequate consultant experience as contributors to causes of delays. In construction industry, they are many consultants carry out their work without experience. Besides that, there are many causes of a consultant without experience which include different site conditions, mismanagement and maladministration, site access restrictions, defective plan and/or specification. For instances, some of the architects only concentrated in certain part of building and do not have any experience in other type. Once architect design on that particular type of building without experiences, he will facing a lot of mistake and no ideas during design and because of this architect will delay issue the drawing. Finally, the works cannot process and it will affect the whole project delay. 2.3.3.2 Poor design and delay in design According to Ogunlana, et al.(1996) mentioned the factors of poor design and delay in design that contribute to causes of delays in construction project. Design is every important to any project, without good design the whole project will influence delay. It is because in a project if facing poor design that will facing demolish and rebuilt again. This problem happens because of the designer lack of experience. For instance, an architect designs a column in the middle of classroom. Once the contractor without any experience and construct the work exactly shown in the drawing. Finally 2.3.3.3 Incomplete drawing and detail design Long, et al. (2004) identified the factors of incomplete drawing and detail design as contributors to causes of delays. Ogunlana, et al. (1996) studied the factors of incomplete drawing and detail design that contribute to causes of delays in construction project. During construction, the contractor is carrying out the work but because of drawing is unclear and none very detail shown in the drawing. He could not continue the work with problem, so the works have to stop immediately until get more detail of that particular drawing from consultant responds. Because of without detail drawing the work could not be progress, so it will affect the tat particular work delay and it will also influence the whole project delay. 2.3.4 Causes of labour related delays Figure 2.6 Factors of labour related delays 2.3.4.1 Labour supply Abd Majid and McCaffer (1998) identified the factors of slow labor supply that contribute to causes of delays. Odeh and Bataineh (2002) in their research identified à ¢Ã¢â€š ¬Ã…“the factors of labor supply as contributors to causes of delays. Besides material, the labour also consider as major source in the construction industry. Generally, labour are categories into two groups such as skilled workers and unskilled workers. In construction industry without labour project could not run. For instance, during construction, materials are ready to but no worker carrying out the work. During the same time because of no worker to progress of work, the project will confront project delay. 2.3.4.2 Shortage of skilled worker According to Chan and Kumaraswamy (1996) mentioned the factor of shortage of skill labor is the most important factor that contributed to causes of delays. Skilled worker is a worker who has some special skill, knowledge and ability in his job and also gets highest pay such as plasterer, carpenter, painter, and concreter. Those skilled workers are learning the skills on the job. In construction, some contractors do not hire skilled workers because of higher labour cost and he employs some unskilled workers. At the same time skilled workers do not want get the job from the contractor with lower labour cost. Finally the unskilled workers could not complete the work on time. So, because of shortage of skilled worker affect whole project delay. 2.3.4.3 Labor of productivity According to Ogunlana, et al. (1996) studied the factor of labor productivity having high influence to causes of delays. Labor of productivity; generally define as output per labour hour. There are many factors that influence on the labour productivity. One of the factors is workers experience, labour with high experience and high skills in field leads to high performance at workplace. Besides that, attitude also will affect productivity of labour. For instance, a worker can lay one meter square per hour but because of lazy. Finally he using three hours to finish laid the brick wall. Because of this factor, the progress work delay and it will also influence the whole project delay. 2.3.5 Causes of Material related Delay Figure 2.7 Factors of material related delay 2.3.5.1 Shortage of construction materials Koushki, et al. (2005) mentioned that, factor shortage of construction material that contribute to causes of delays. Ogunlana, et al. (1996) identified the factor of shortage of material as a factor to causes of delay. Chan and Kumaraswamy (1996) studied that factors shortage of material as contributors that contribute to causes of delays. Abd Majid and McCaffer (1998) identified the factor of shortage of material that contribute to causes of delays. Material shortage is a potential source of construction delay. The major causes of material shortage is demand exceed supply. In construction have a lot type of material and the three main courses are cement, formwork and steel bar. Besides that, material is one of the main sources in construction industry. It is because without material project cannot construct. If a project facing the material shortage problem will be delay. For instance, a project having shortage ceramic tiles even though the labours ready for tiling. In this situatio n, the project will facing delay project. 2.3.5.2 Late delivery of materials Ogunlana, et al. (1996) identified the factor of late delivery of material as a factor to causes of delay. Abd Majid and McCaffer (1998) studied the factor of late delivery of material that contribute to causes of delays. Late delivery of material as a supplier fault due to high market demand; however the long procedure of the purchasing order from head office was complained. In construction, it factor is similar to the material shortage such as the labour ready for work but no material to do their work. Once contractor cannot receive the material on time that will be delay work and it will also affect project delay. For example, workers want to install the windows but without frame because of late delivery to site. So, the work will be delay and it will affect project delay. 2.3.5.3 Poor quality of construction materials Koushki, et al. (2005) mentioned that factor poor quality of material that contribute to causes of delays. Ogunlana, et al. (1996) identified the factor of poor quality of material as a factor to causes of delay. Abd Majid and McCaffer (1998) studied the factor of poor quality of material that contribute to causes of delays. Poor quality of material is construct building with using poor quality of material. The contractor has intention to cheat owner to earn more profit by change the quality of material such as concrete. For instance, a contractor cast a column with using Y 20 steel bar but actual in contract drawing is Y 25. After site staff done the inspection for this column and found that the steel bar inside column is Y 20 and ask contractor demolish the column to rebuild. In this case, time taken to rebuild the column will also affect project delay. 2.3.5.4 Escalation of material prices Ogunlana, et al. (1996) identified the factor of escalation of material prices as a factor to causes of delay. Wiguna and Scoot (2005) studied the factor of escalation of material prices was one factor that contribute to causes of delays. Escalation of material prices will cause shortage material in construction. It is because the market rate is keeping increasing. Some of the contractor does not buy the expensive material. During same time, the construction without material cannot run so the project will influence the project delay. For instance, a contractor because of material cost of market demands higher and does not make any order for material until material shortage. Finally, the construction cannot run without material and it will affect delay project also. 2.3.6 Causes of Equipment Related Delays Figure 2.8 Factors of Equipment related delays 2.3.6.1 Insufficient number of equipment According to Ogunlana, et al. (1998) identified the factors of insufficient numbers of equipment is the most significant factors that contribute to causes of delays. In construction stage, contractors are facing not enough machinery to produce work. It is because some of the contractors do not have a large capital to purchase that machinery due to higher cost. Once the projects carry out with not enough machinery, it will influence whole project delay. For instance, there are two works to be done by using towel crane but in site only one towel crane available. Finally, two of work could not be done at the same time due to not enough towel cranes. 2.3.6.2 Frequent equipment breakdown McCaffer (1998) studied the factors of equipment breakdown as contributors to causes of delays. Ogunlana, et al. (1998) mentioned the factor of frequent equipment breakdown is the most significant factors that contribute to causes of delays. In construction industry, some of the machinery always breakdown due to improper using by worker such as do not follow the instruction. For instance, machinery only can support for five hundred kilograms of material but during worker using that machinery and his carry out six hundred kilograms of material. Finally, the machinery will breakdown. Once machinery breakdown, the work will be stop immediately and affect some work delay. Finally, because of machinery breakdown the whole project will also influence delay. 2.3.6.3 Shortage of Equipment Parts According to Chan and Kumaraswamy (1996) identified the factor of shortage of equipment parts that contribute to causes of delays. After machinery breakdown, the technical carry out the repair work for the breakdown of equipment. During the same time, some part of machinery none have stock in market. Because of no spare part to repair the machinery, some of the works facing stop progress immediately. Consequently, it will influence whole project to be delay. 2.3.7 Causes of Financial Related Delays Figure 2.9 Factors of Financial related delays 2.3.7.1 Clientà ¢Ã¢â€š ¬Ã¢â€ž ¢s financial difficulties According to Chan and Kumaraswamy (1996) identified the factors of clientà ¢Ã¢â€š ¬Ã¢â€ž ¢s financial difficulties as contributor to causes of delays. During the construction, client will face some financial problem arise from unanticipated emergencies or financial mismanagement such as global financial crisis. Besides that, a client proposes a new development without borrow term loan or bridging loan from the bank. On the other hand, improper cost planning is a most serious problem for those clients facing in current delay project. For instance, during pre-construction stage a client do not planning cost properly and he will facing a lot of problem in construction stage such as no enough capital to pay contractor payment. Finally, because of contractor did not receive payment to influence whole project delay. 2.3.7.2 Delay payment to suppliers/subcontractor According to Abd Majid and McCaffer (1998) mentioned the factors of inadequate fund allocation and delay payment to subcontractor/suppliers as contributor to causes of delays in construction project. Due to sub- contractor do not take their responsibility to done the work on time. The contractor will delay the payment until they complete the job. But at the same time, the sub-contractor refuse to work because of not yet receive payment. As a consequently, the whole project will be influence delay due to sub-contractor refuse to work. 2.3.7.3 Contractorà ¢Ã¢â€š ¬Ã¢â€ž ¢s financial difficulties According to Ogunlana, et al. (1996) studied the factors of contractorà ¢Ã¢â€š ¬Ã¢â€ž ¢s financial difficulties having high influence to causes of delays. Poor financial management has been known as one of the factors why certain project cannot complete within contract period. Because of contractor lack of experience and could not manage their capital properly. On the other hand, because of delay payment by client contractor not enough money to cover up all sub-contractors and suppliers payment. Finally, the sub-contractor and suppliers refuse to work and supply material to the site and because of this factor the whole will influence delay. 2.3.8 Causes of External Related Delays Figure 2.10 Factors of external related delays 2.3.8.1 Weather condition Odeh and Battaineh (2002) identified the factors of weather condition as contributors to causes of delays. Long, et al. (2004) mentioned factors weather condition as factors ofexternal related delays. AL-Momani (2000) studied the factor of weather condition as contributors to causes of delays in construction project. During the construction period, weather is a factor to influence the whole project delay. It because weather condition that interfere with planned activities. Some activities can process but other cannot. For instances, during the worker cast the ground floor slab, but because of raining that particular work to be delay. 2.3.8.2 Slow site clearance According to Long, et al. (2004) identified factors of slow site clearance as factors of external related delays. During begin of construction stage, the responsibility party should have to carry out their work for site clearance immediately. Without clearance the site construction work cannot process. In some delay project found that, the third party did not take their responsibility to finish the site clearance within the period. Consequently, the whole project delay because of site clearance works delay. 2.4 Effect of Delays According to Aibinu and Jagboro (2002) identified the effects of construction delays on project delivery in Nigerian construction industry. They also said that the six major effects of delays follow by rank which include time overrun, cost overrun, dispute, arbitration, litigation, and total abandonment as shown in the Table 2.11 Effects of Delay Rank Time overrun 1 Cost overrun 2 Dispute 3 Arbitration 4 Litigation 5 Total Abandonment 6 Source : Aibinu and Jagboro (2002) Table 2.11 The effect of delays 2.4.1 Time overrun Time overrun it mean contractor could not carry out their work within contract period. In generally, time overrun can be categories into two group which include excusable delays and non-excusable. Once the project facing time overrun, it will affect the progress of work cannot finish on time. Besides that, the fault party will take the responsibility to pay the relevant parties for damages because of delay. For instance, during the project almost completed, but at the same time contractor because of exceptionally implement weather cannot completed the project within contract period. In this situation the contractor entitle to claim extension of time. On the other hand, if that contractor cannot complete the work within contract period due to his own fault. So the contractor no entitle to claim extension of time and he need to pay liquated damages. As stated in Persatuan Arkitek Malaysia form 2006 (PAM form 2006), which certain clauses stating about the damages by employer due to this event. It stated that in clauses below. 2.3.1.1 Clause 22.1 Liquidated Damage and Certificate of Non-Completion If the contractor fails to complete the works by the Completion Date, and the architect is of the opinion that the same ought reasonably so to have been completed, the architect shall issue a certificate of Non-completion. Upon the issuance of the certificate of Non-Completion the contractor shall pay or allow to the Employer a sum calculated at the rate stated in the Appendix as Liquidated Damages for the period from the Completion Date to the Date of Practical Completion. The Employer may recover such sum from the Performance Bond. The Employer shall inform the contractor in writing of such deduction or such debt due to from the contractor. The imposition of Liquated Damages by the Employer shall not be taken into account by the Architect in the issuance of payment certificates and Final Certificate, and is not subject to the set-off procedures under clause 30.4 and adjudication. 2.3.1.2 Clause 23.1 Submission of notice and particulars for extension of time If the Contractor is of the opinion that the completion of the Work is or will be delayed beyond the completion Date by any of the Relevant Event stated in Clause 23.8, he may apply for an extension of time provided always that 2.3.1.3 Clause 23.8 Relevant Events Exceptionally implement weather 2.4.2 Cost overrun During construction stages, the client and contractor always facing of cost overrun. Cost overrun  is an unexpected  cost  incurred in excess of a budgeted amount, due to  cost underestimation. Cost overrun is related to time overrun, once a project cannot be done in time, it will also affect the cost of project over budget. Commonly, cost overrun always happen due to contractor own fault such as inaccurate of cost estimate and he need to take responsibility to pay owner loss and expense. For instance, a contractor because of improper cost planning due to cost overrun. Finally, the owner set of his loss and expense from the contractor interim payment. 2.4.3 Dispute In construction industry, some of project delay because of dispute between contractual parties such as client, consultants, contractor and some relevant parties. Those disputes because of client failure make payment to the contractor. Once dispute happen, the relevant parties will go through with mediation. The mediator will make a decision to solve the problem. But if one of the parties does not accept the decision made by mediator, the parties will appeal the decision with arbitrator. If both parties accept the decision and the fault parties will take responsibility to pay damages for project delay. 2.4.4 Arbitration In current delay project, some of the contractual parties do not accept the mediator decision and they appeal in arbitration. Arbitrator will also make the decision to solve the problem. But if one of the parties does not accept the decision again made by Arbitrator, they still can appeal the decision in litigation. 2.4.5 Litigation In some delay project, the relevant parties because of still do not accept with the arbitrator decision. They are appeal the result in litigation which is dispute resolution in the courts. In litigation, the parties have a trial either by a court alone or by jury. If those parties are not satisfied judgment again, then they can appeal again if they have any new evidence to proof their right. But one the parties accept with the judgment, the faulty of parties need take responsibility to pay the penalty 2.4.6 Total abandonment Total abandonment it means the whole project stop immediately because of client facing financial difficulties. Some of the current delay project totally abandoned because of clientà ¢Ã¢â€š ¬Ã¢â€ž ¢s or contractor problem which include clients bankruptcy, contractor run away, poor marketing and sales strategies and so on. The effect of project totally abandoned will affect many parties such as contractual parties which include contractor, consultant, sub-contractor, supplier and some other relevant parties. Besides those parties, the purchasers will also suffer in cost damages due to project abandoned. 2.5 Methods of minimizing construction delays According to Nguyen, et al. (2004), à ¢Ã¢â€š ¬Ã…“studied the factors that can be applied as a method of minimizing of construction delays as follows: competent project manager; frequent progress meeting; accurate initial cost estimates; accurate initial time estimates; awarding bids to the right/experience consultant and contractor.à ¢Ã¢â€š ¬? During pre-construction stage, a client should employ a depth knowledge project manager to organize a good project team member to progress the work. Besides that, the project team member should be always discussing with the problem having during the site progress. On the other hand, contractor should be employs some employee with experience such as quantity surveyor. So that, during the time or cost estimate they can add on some unforeseen event to avoid the cost and time overrun. Furthermore, the developer should be hire some experience consultant and contractor.iot is because once they facing problem, they can refer previous project to so lve the problem immediately. So, the project can process with smoothly. According to Aibinu and Jagboro (2002), à ¢Ã¢â€š ¬Ã…“identified two methods to minimize or if possible eliminate time overrun were: acceleration of site activities, and contingency allowance.à ¢Ã¢â€š ¬? During construction stages, the contractor should carry out his responsibility to make sure the work progress can complete in time. If found that work progress are not equal to the estimate schedule. The contractor may carry out with acceleration such as hire additional worker. Besides that, the client may allow contractor standby some extra cost for unforeseen event such as accidents. According to Koushki, et al. (2005), à ¢Ã¢â€š ¬Ã…“revealed that the minimization of time delays and cost overruns would require: ensure adequate and available source of finance until project completion; ensure timely delivery of materials.à ¢Ã¢â€š ¬? During pre-construction, a client may prepare a good cash flow within the contract period. Once the client does not enough money to cover up construction cost, he can borrow a term loan or bridging loan from the bank to cover the cost until the whole project completed. It will avoid project delay due to client not enough capital. Besides that, the contractors make sure that material are order with a reliable suppliers and can receive it on time. Acco Munro Review: Lipsky’s Notion of Street-Level Bureaucracy Munro Review: Lipsky’s Notion of Street-Level Bureaucracy The Munro Review; Lipsky’s Notion of Street-Level Bureaucracy put in practice Charlotte Bindels Introduction Before an examination of the work conducted by social workers who are responsible for child protective services within the UK can take place, it is crucial to define the concept of Street-Level Bureaucracy (SLB). What does it exactly entail and who are street-level bureaucrats? Can we safely assume that social workers parallel the characteristics of street-level bureaucrats or is this assumption a false one? Social workers, in general, face enormous pressure from within the community to perform well. There is a lot at stake and the well-being of individuals needs to be protected. Thus, how could a government quantify government impact on citizens? Many scholars are still puzzled by this question as it poses many discussions. Michael Lipsky, a North American scholar, incorporated this discussion in his work on Street-Level Bureaucracy. In his book, Street-Level Bureaucracy; Dilemmas of the Individual in Public Services he introduced the abovementioned term while gaining widespread rec ognition. The concept is universal as the dilemmas and constraints faced by professionals operating at the street-level include various problems and challenges. But are these problems also compatible to the social workers within the child protection services in the United Kingdom? The aim of the paper is to see whether social workers of child protective services in the United Kingdom show a resemblance to the notion of the Street-Level Bureaucracy Framework as put forward by Lipsky. This analysis will include the Final Report of The Munro Review of Child Protection as this report covers the recommendations to improve upon the child-centred system and is the prime sources for this report. Another main source describes the framework of Street-Level Bureaucracy introduced in Lipsky’s book; Street-Level Bureaucracy; Dilemmas of the individual in public services. Moreover, other concepts need to be examined as well, in order to analyze the possible relationship between social workers and street-level bureaucrats. Finally, this paper will determine whether the relationship between social workers as described in the Munro report and the SLB framework of Lipsky appears compatible or not. Conceptual Framework First and foremost, an examination is needed of the theoretical framework used by Lipsky for his book on Street-Level Bureaucracy; Dilemmas of the Individual in Public Services originally published in 1980. He presents a framework that allows for comprehension of the role of public service workers when it comes to policy implementation. He argues that teachers, social workers, and judges etc. constitute the essence of street-level bureaucrats. Additionally, he acknowledges that his book draws upon observations underlining collective behavior of public service organizations. Moreover, in his book he captures the importance of locating the problems street-level bureaucrats face while doing their jobs. By analyzing Street-Level Bureaucracy it becomes more evident to identify commonalities and deficiencies between different operational surroundings. (Lipsky, 1980) Firstly, the term Street-Level Bureaucracy needs to be defined in order to comprehend the aim of this paper. Lipsky (1980) published his book on Street-Level Bureaucracy in 1980 providing a profound study of the influence of public service workers on public policy, the so-called street-level bureaucrats. The challenge, he stresses, is to find a balance between executing their jobs with considerable discretion while also serving as policy decision-makers. Examples of street-level bureaucrats typically include workers who interact directly with citizens while carrying out their jobs. Lipsky sums up teachers, judges and police officers to illustrate his point. However, for the purpose of this paper the focus will revolve around social workers as Lipsky also defines them as street-level bureaucrats. Hence, social workers must be viewed as policy shapers, not only as those who simply implement a policy. Lipsky (1980) writes that there are two ways to interpret the term of street-level bureaucrats. On the one hand, he portrays them as being equal to public services, thus highlighting that this is how citizens interact. On the other hand, as originally intended by Lipsky, street-level bureaucrats only interact with citizens during the course of their jobs while simultaneously exercising discretion. Another relevant concept to incorporate is the notion of social workers, as this paper also examines the Munro Review. While this may seem obsolete it is vital to understand the characteristics of these workers. More specifically, the social workers concerned with child protection in the UK. Can they be perceived as street-level bureaucrats? The definition of social work underwent many changes throughout the years. Globalization needs to be reckoned with as social workers nowadays face many challenges to practice their knowledge in a complex world. The core definition of social work reads as follows, Hare (2004) â€Å"The social work profession promotes social change, problem-solving in human relationships, and the empowerment and liberation of people to enhance wellbeing. Utilizing theories of human behavior and social systems, social work intervenes at the points where people interact with their environments. Principles of human rights and social justice are fundamental to social work.† Discretion, another concept used extensively by Lipsky also needs to be explored. Lipsky (1980) regards discretion as beneficial to the policy process as it enhances policy at the grass roots level. The Oxford Dictionary defines discretion as: â€Å"Thefreedomtodecidewhat should be done in aparticularsituation† (Oxford online dictionary, n.d). Carrington (2005) describes discretion as a part of the decision-making process which will lead an individual to act or not to act. Moreover, he adds that these decision-makers have the freedom to decide on an action or non-action. According to Lipsky (1980) the use of discretion is critical as street-level bureaucrats communicate with citizens every day. However, this is not an easy task as dilemmas occur more frequently making the work of individuals within the public service complex. According to Lipsky (1980), social workers are drawn to the public service since they feel the need to help others. The continuation of discretion has bo th opponents and proponents. Proponents, such as Ellis et al. (1999), see discretion as support to filling up the gaps in public policy. Opponents, however, such as Baldwin view discretion as undermining official public policy (Baldwin, 1998). Thus, discretion can be viewed in different ways. The concept of discretion is highlighted by Lipsky as the characteristics of street-level bureaucrats involve high levels of discretion as well as continuous interaction with citizens. The constraints and dilemmas faced by SLBs include insufficient resources available to the workers and in order to meet the supply demands for services increase. Furthermore, the goals set out by agencies are rather ambiguous and the measurement of performance achievement turns out to be impossible to measure. In addition, clients tend to be mostly non-voluntary. (Lipsky, 1980, p.27) Case Description In the Munro Review of Child Protection (Munro, 2011), recommendations are set out to improve upon, aiming to reform the child protection system within the United Kingdom. These recommendations are designed to eliminate the over-bureaucratization and the need for compliance and a shift towards more focus on children, hereby exploring issues and assessing the effectiveness of the received aid. The report sums up a total of fifteen recommendations, each of those belonging to a particular subject (Munro, 2011). However, for the purpose of this paper I will only examine those that are set out in chapters three, six and seven, providing three recommendations that comply with the theoretical framework of SLB by Lipsky (1980), highlighting the effect of these propositions on the work of the child protection services. Chapter three ‘A system that values professional expertise’ symbolizes the difficulties in identifying the constraints faced by social workers and their managers. Many experience that the practice puts a heavy emphasis on compliance with management criteria and guidance. Consequently, they fail to follow the effectiveness of helping children. The recommendations value a clearer focus and a revision of the guidance. Chapter six ‘Developing social work expertise’ argues that an increase in expertise of employers and individuals will positively influence the relationship with children. Chapter seven ‘The organizational context: supporting effective social work practice’ addresses the importance of continuous reviewing (Munro, 2011). In the upcoming section I will describe the three recommendations before returning to this issue in relation to Lipsky’s Street Level Bureaucracy in the analysis. First, recommendation thirteen originating from chapter seven revolves around the organizational context. More specifically, it suggests that ongoing reviewing and redesigning are significant factors in the successful functioning of the child protection services in the UK. Additionally, the effectiveness of the service will increase and thus affect the social conditions of children and families (Munro, 2011). Secondly, emerging from chapter six of the Munro review, recommendation twelve considers the notion of the cooperation between the so-called HEIs, higher education institutions, and companies. The aim of this recommendation in question is to prepare upcoming social workers for their future careers within the Child Protection Services. This cooperation will thus lead to better practice placements and the application for particular ‘teaching organization’ status. Furthermore, these high quality placements will determine the relationship between HEIs and employers (Munro, 2011). Third and finally, recommendation four as set out in chapter three focuses on the collection of information by local authorities and their partners. A combination of information collected by both actors will have positive effects on the subsequent evaluations of performances (Munro, 2011). Analysis It is of importance to see whether these recommendations, as discussed above, show any resemblance or a conflict to the Framework of Street-Level Bureaucracy as set out by Lipsky. In the Munro Review it is clearly stated that the recommendations are not to be considered as separate entities, but rather reviewed as a whole (Munro, 2011, p.10). Therefore, the analysis will seek to address the aforementioned recommendations four, twelve and thirteen accordingly. A comparison will be made between the dilemmas social workers in the UK face and those of the street-level bureaucrats; are they reconcilable or conflicting? Moreover, do these three suggestions contribute to solving the dilemmas street-level bureaucrats face on a daily basis? Judging from the outlook of Street-Level Bureaucracy, the recommendations posed for social workers within child protection services in the Munro Review comply with the framework initiated by Lipsky (1980).When trying to assess the work by Lipsky on SLB and the Munro report it seems as though both of them share the same problems and dilemmas. The problems and challenges faced by street-level bureaucrats and social workers seem to overlap one another rather than contradict. One clear example revolves around the lack of resources when carrying out jobs in child protection services as mentioned in the final report by Munro. The exact same applies to the street-level workers as Lipsky dedicates a whole chapter to the problem of resources in his book on Street-Level Bureaucracy (Lipsky, 1980), also described in the conceptual framework. The reconciliation of both seems to live up in general, however, is this still the case when analyzing the separate recommendations? The Munro review, as discussed in chapter three (recommendation four) aspires a more professional perspective when it comes to the child-centred system in order to preserve a clear focus on the effectiveness of helping children. Recommendation four promotes a more bottom up approach when it comes to implementing the suggestions set out by the Munro report. A combination is needed of locally- as well as nationally collected information to accomplish the goals mentioned in the recommendation. This indicates that a level of professionalism is required at the lower levels, or as Lipsky puts it, at the street-level as it will guarantee a focus of all parties involved. Lipsky argues that the limits on bureaucracy contribute to the debate that street-level bureaucrats are in fact professionals. This professionalization starts with the social worker who feels the need to act when control cannot be imposed from the outside (higher level). Some form of self-monitoring replaces the control exer cised by top-level managers, underlining the fact that street-level bureaucrats exercise autonomy. (Lipsky, 1980, p.201) It becomes evident that the suggestion as described above parallels Lipsky’s way of thinking. Recommendation twelve applauds cooperation between HEIs and social work students to enhance preparation for entering the real world of the child protection services. This demonstrates a compatibility with Lipsky’s foundation of Street-Level Bureaucracy. When addressing the sustainment of SLB and leadership, Lipsky mentions that in the future a New Street-Level Bureaucracy needs to be developed with particular attention to teaching and practice. The new street-level bureaucrat acknowledges the value of teaching as well as the practice involved in public services. According to Lipsky (1980, p.209): â€Å"Some of their teaching ought to be done not in universities but in the field, where there is opportunity for constant confrontation with the realities of practice.† Finally, recommendation thirteen stresses the importance of continuous reviewing and redesigning. The aforementioned suggestion described the New Street-Level Bureaucracy as a future for SLB. Lipsky also acknowledges that, in order to innovate, the development of inquiry and criticism should be kept in place. He also emphasizes that these processes are of an ongoing nature to promote continuous review moments. Both the Munro Review (Munro, 2011) and Lipksy state that these moments of review share a collective approach for improving the performance of street-level bureaucrats and Munro’s social workers (Lipsky, 1980, p. 209). Recommendation thirteen appears most feasible from the perspective of the street-level bureaucrat as they illustrate that regular interaction between themselves and citizens is crucial, hereby combatting a problem faced by many street-level bureaucrats. Both recommendations four and twelve are also feasible but not in the short-term. Judging from the above, the recommendations as put forward by Munro (2011) appear compatible with the conceptualization of Lipsky (1980). However, does this hold true for all recommendations? A brief check of the recommendations illustrates that some divergence is virtually nonexistent, as the ideas of the suggestions can be reconciled with Lipsky’s argumentation concerning Street-Level Bureaucracy. Conclusion Street-Level Bureaucracy as introduced by Lipsky in the 1980s sheds an interesting light on the involvement of these bureaucrats on policy implementation and their influence. In the final report of the Munro Review of Child Protection a total of fifteen recommendations are presented in order to increase the effectiveness of the child-centred system. Essential are the social workers executing their duties in an over-bureaucratized environment according to Professor Eileen Munro. The need for more involvement and management at the front line might show a resemblance to Lipsky’s SLB Framework at first sight. However, the need to examine this more closely is the aim of the paper. Do social workers of child protective services in the United Kingdom show a resemblance to the Street-Level Bureaucracy Framework as coined by Lipsky or not? In other words, are they in conflict or compatible? While it might seem the case that they are compatible at the first glance, the three recommendations chosen from the Munro Review should display the same in order to demonstrate this resemblance. It is evident from the analysis that the three separate recommendations present a relationship between the social workers in child protective services and the framework of SLB by Lipsky. Especially recommendations twelve and thirteen are mentioned precisely by Lipsky as well when examining his book. Hence, the outcome is therefore simple as the relationship is apparent. As a result, the recommendations appear feasible from the perspective of SLB. In particular recommendation thirteen because continuous reviewing is something that can be applied directly generating results in the short-term. Bibliography Baldwin, M. (1998). ‘The positive use of discretion in social work practice: Developingpractice through co-operative inquiry’. Issues in Social Work Education. Volume 18 Issue 2. Pp. 42-8. Carrington, K. (2005). ‘Is There A Need for Control?’. Public Administration Quarterly. Volume 29 Issue 1. Pp.140–161. Department for Education. (2011). 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