PETALING JAYA: About 200 contractors nationwide have returned the letters of award to the Government for projects that have yet to start, saying they are unable to bear the escalating costs.

Malay Contractors Association vice-president Ali Sheikh Ahmad said some of them were members of the association and that the 200-odd contractors were from all classes.

"Contractors are afraid to start work for fear they may suffer losses and those who have successfully obtained the tender for projects are facing problems because of the increase in prices of building materials and fuel.

"The prices were low when the projects were tendered, but many contractors are now facing problems starting the projects," he said when contacted yesterday.

Ali Sheikh said the Government should include a variation of price clause in the project contracts to cater for building material price increases which would safeguard contractors against sudden increases in material costs.

Deputy Works Minister Datuk Yong Khoon Seng and Public Works Department director-general Datuk Dr Judin Abdul Karim said neither of them was aware of contractors returning their letters of award.