Standardising Cost-sharing of Additional Fuel-related Costs between Government and Contractors

Ms Lee Hui Ying asked the Prime Minister and Minister for Finance (a) what criteria are used to determine how additional fuel-related costs incurred by contractors from 1 March 2026 to 31 May 2026 are shared between the Government and contractors; (b) whether the cost-sharing proportion will be standardised; and (c) whether support will be given to contractors who are not involved in key Government projects.

The Government is co-sharing 50% of the direct additional costs arising from the use of diesel and bitumen in ongoing critical public sector construction projects, where any delay or stoppages would clearly affect public interest. The construction activities being supported are earthworks, foundation and piling works, reclamation works and roadworks, which are the most severely affected due to their heavy reliance on diesel-powered equipment.

Other contractors are supported through broad-based support measures for businesses, such as the Corporate Income Tax Rebate and Cash Grant. Private sector developers are strongly encouraged to similarly share the diesel and bitumen cost increases with their contractors.