Mr Zainal Sapari asked the Minister for Education (a) what is the current total value of cleaning contracts for schools and the total amount of liquidated damages imposed on cleaning service providers under their immediate past term contracts; and (b) what are the reasons cited for the imposition of liquidated damages.

Mr Heng Swee Keat: MOE outsources cleaning functions in the 380 schools under its purview. The current contracts for cleaning, which took effect from 1 February 2011 are valued at $63.5 million per annum and were awarded to six contractors.

The contracts provide for deductions to be made on progress payments to the cleaning contractors for non-delivery of work, as specified in a schedule of the contract. Examples of non-delivery include failure to meet agreed cleaning performance standards and the failure to carry out the committed cleaning plan.

Cleaning contractors have generally met the performance standards and fulfilled the cleaning plans. Non-delivery of service is uncommon. In the course of the 14 months since the start of the current contracts, a total of $21,700 in deductions was made for non-delivery. This amounted to $18,600 per annum or 0.03% of the annual contract value of $63.5 million.

With regard to the previous contract term, the contracts ran from 1 August 2006 to 31 January 2011 with an annual contract value of $60.3 million. Total deductions for non-delivery of service amounted to $48,000 per annum or 0.08% of the annual contract value.

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