Hadi Sirika, the minister of aviation, on Monday, November 2, 2020, accused airlines operating in the country of owning the Federal Government the sum of $6,993,234.00 and N19,365,374,686.00 in unremitted fees.
Also, on Monday, November 2, 2020, the Chairman Senate Committee on Aviation, Senator Smart Adeyemi said that the N4 billion earmarked by the Federal Government as bailout for airline operators to cushion the harsh effects of the COVID-19 pandemic was “too little.”
Sirika and Adeyemi spoke at the commencement of a three day public hearing on the repeal and re-enactment of six Aviation Bill organized by the Senate Committee on Aviation in Abuja.
The Minister’s revelation followed comments by a representative of the Airline Operators of Nigeria, AON, Chinasa Unaegburam, who criticized a proposed five percent service charge to be paid by airlines in the Bill meant to Repeal and Re-enact the Nigeria Civil Aviation Authority, NCAA, Act.
Unaegburam said: “Clause 23 of the NCAA Bill seeks to impose a cost of five percent contract sales and service charge on airlines. That five percent has been in the law since 2006. Our proposal is that consideration be given to lowering that percentage.
“We are proposing that we have our fees at cost recovery so the aim is to ensure that these agencies are run efficiently in the system and that there is accountability and transparency.
“Putting these factors in place, we can then justify the retention of this five percent. But today members of the AON are groaning.
“We propose 1.5% but it is subject to negotiation. The operators have to operate efficiently which is a very important issue for the operators.
“Again, there is a provision for a two-year imprisonment on non-remittance of charges.
“An airline should not be subjected to a jail term for non-remittance of a charge. The whole section should be expunged.”
In his response, Sirika said: “We have concerns and they are very genuine. NCAA operates on cost recovery basis.
“They (AON) are owing us $6, 993, 234.00 and N19, 365, 374, 686.00. She is proposing that the percentage goes down and the money is not there.
“These are monies we get from tickets and they ought to be remitting this money so that we can train more inspectors and keep the industry safe.
“We are here so we get a very robust civil Aviation Act.”
Meanwhile, Adeyemi had in his opening remarks called on the Federal Government to assist the aviation sector in the country with bailout funds to enable them sustain their operations now badly affected by the COVID-19 pandemic.
Adeyemi said: “Let me take this unique opportunity to call on the Federal Government to explore the possibility of providing bailout funds for the Airline Operators.
“The outbreak of the COVID-19 Virus is a global and on-going pandemic and countries all over the world are providing bail out funds for airline operators.
“Certainly, the aviation industry was the most affected by this virus attack and therefore needs all the support possible to resuscitate the industry.
“In the absence of this, so many airlines will struggle to stay in business or worst still, be forced to withdraw their services.
“Bailout funds will mitigate the devastating effects of the COVID-19 and also discourage operators from cutting corners as the consequences can only be better imagined.”
In his response, Sirika said that the Federal Government has already made provision for a bailout fund of N4 billion for airline operators and N1 billion for business operators in the aviation sector.
Sirika said: “The Federal Government has approved N4 billion as bailout for the airlines and N1 billion for other businesses within the civil aviation.
“We are already putting arrangements for the disbursement and once we start, it would be transparently done.”
However, Adeyemi challenged the Federal Government to do more saying the N4 billion bailout fund already earmarked for the airline operators was too meagre compared to the critical role of the sector in the growth of the nation’s economy.
He said: “Let’s look at the cost of spare parts for the airlines and duties that they perform.
“Though, we might argue that the business is a private one, but it is centred on safety.
The N4 billion approved for the airlines by the Federal Government is too little to make any impact on the operations of the airlines.
“If you want to keep the airlines in business and you don’t want them to start cutting corners, there is need to look at the airlines with a view to giving them substantial support.
“If they start cutting corners, which will be worse for the industry. We may not be professionals in the sector, but we know how some of the airlines outside the country operate.
“The role of the aviation sector cannot the over-emphasized. Minister, you have a role to play to take the issues of the airline operators to the Federal Executive Council, FEC.
“I don’t know if the Central Bank of Nigeria, CBN, is here, but, they too have a role to play to ensure safety in the sector.”
However, while answering questions from journalists after the session, the Minister of Aviation, Sirika, agreed that the N4 billion earmarked for the bailout of airlines in the country was small but added that that was what the Federal Government can afford at the moment.
Source: The Nation
