There has been controversy in the aviation sector for the past two weeks over the measures adopted to recover debts by Federal Airports Authority of Nigeria, (FAAN) from airlines operating in the country.
A case in point was that, which arose last Wednesday when the operations of Arik Air, the largest carrier in the country were picketed by aviation union workers over alleged N12.5 billion debts.
Arik seems to be on their toes with a two weeks ultimatum issued by Federal Government to reach amicable resolution.
The situation is such that has amounted to confusion, counter accusations and disparity in figures against agencies and airlines, in a bid to recover alleged debts owed for the services rendered to the airlines.
Experts and operators in the industry have said this atmosphere is not good for the sector as roles are being swapped and aviation union members have emerged debt recovery agents for aviation agencies.
Last Wednesday, some aviation union members under the aegis of National Union of Air Transport Employees(NUATE), and the Air Transport Services Senior Staff Association of Nigeria ( ATSSSAN ),and the Nigerian Union of Pensioners (NUP) distrupted the operations of Arik Air at the General Aviation Terminal (GAT), of the Murtala Muhammed Airport , Ikeja, Lagos over alleged debts running into N 12.5 billion.
The development forced many intending Arik Air passengers to cancel their journeys, and business appointments as well as meetings.
Chris Ndulue, Managing Director, Arik Air described the disruption of Arik Air flight operations by aviation unions as unfortunate.
Ndulue said:” when the revenue drive was ongoing and our operations were grounded, we tried to reach the management of FAAN via phone calls and they did not respond and even text messages and up till now we are speaking they have not responded”
Emeka Nwigwe, a lawyer from Babajide Goku Chamber, who is the legal consultant to Arik declared that what the unions did last week was an affront on the Federal High Court and the state, adding that if FAAN does not want the court to resolve the issue, the agency should tell the court.
In his words, “It is an affront on the Federal High Court and the state .A situation where staff whether individual or group decides to turn themselves into debtor collecting agency is absurd”.
Nwigwe said, “FAAN has no documents to back their claims, they simply result to intimidation. The case is in court. FAAN’S action is contemptuous. The law is very clear; no party should take anticipatory action when a case is pending.”
He noted that FAAN took the matter to court in 2015 but that it seemed FAAN was not able to satisfy the court why Arik’s airplanes should be arrested.
The Arik Chairman , Arumemi Ikhide said Arik Air has paid the Federal Airports Authority of Nigeria (FAAN) a total of N18.9 billion from inception of operation till date and that FAAN on February 12, 2016 acknowledged in its letter to the airline that it had received the payment of N11.4 billion from Arik.
“We are prepared to pay for services rendered to us but we are not going to be bullied into false payment, Ikhide said.
However, the story took another shape when the Chairman, Airline Operators of Nigeria, Nogie Meggison said he has resolved that the airline would not be bullied into any form of arbitrary payment stating some cost which he termed as outrageous including the cost of electricity at the airport.
Meggison alleged that the airport authority brought an electricity bill for over millions for a month and that since Arik started using the prepaid card, its monthly electricity bill has been less than N700,000 monthly.
This he said has raised questions on the template used for generating electricity bills by FAAN.
Meggison also said that the airline pays Passenger Service Charge to FAAN but still ferries its passengers to the aircraft from the terminal, according to him, those and so many other things have to be reconciled.
Arumemi-Ikhide also recalled the Calabar incident where a man broke in and rammed his car on their aircraft stating that he is aware that FAAN has paid damages to foreign airlines but has not talked about that stating that now is not the time to bring that up.
The run-in between Nigerian carriers and various aviation agencies over settlement of debts is becoming a recurring issue that is threatening the smooth operation of airlines as their operations are frequently disrupted. Each time the Federal Airports Authority of Nigeria (FAAN), the Nigerian Airspace Management Agency (NAMA) and the Nigerian Civil Aviation (NCAA) wield the big stick; it leaves so much pain not only for passengers, but a big blow to airlines.
For the past four years, virtually all Nigerian airlines have had not too pleasant experience from these three major aviation agencies, which put the total indebtedness of domestic carriers to about N100billion.
The same scenario played out four years ago when the FAAN through the same unions picketed Arik over unresolved debts settlement. The action led to excruciating pain for travellers. The agony was unbearable then because just three airlines, Arik, Aero, Overland were in operations then.
Director-General of NCAA, Muhtar Usman, said the directive was with regards to the five per cent TSA/TCA collected at source from the air passengers by the airlines on behalf of the Federal Government of Nigeria.
Usman noted that these sales charges are to enable all aviation agencies carry out their responsibilities of providing safe, secure and efficient regulatory services for the overall benefits of all aviation stakeholders
The NCAA chief stated that it is imperative that all un-remitted funds are forwarded in full to NCAA immediately. The airlines must desist from using these funds “held in trust”.
Usman said the ongoing five per cent Ticket/Cargo/Charter/Sales Charges automation of payments, which offers real-time transparent transactions, must be completed within two months.
He said: “This will remove endless reconciliation of data and reduce high debt profile of Airlines to NCAA. “Reconciliation of all outstanding debts must be completed within 60 days; the five per cent Ticket/ Cargo/ Sales Charges must be on Gross Ticket excluding Value Added Tax (VAT) and Passenger Service Charge (PSC) only.
Chairman/CEO of Air Peace, Allen Onyema, recently lamented the difficulties airline operators are going through in doing business in the country. His words: “The airlines in Nigeria are dead on arrival because of the harsh conditions under, which they operate.
“Multiple taxation by government agencies, high cost of aviation fuel compared to elsewhere, high cost of overhead, prohibitive interest rates from banks, lack of easy access to foreign exchange, lack of night flying infrastructure in over 97 per cent of the airports in Nigeria, the people’s low purchasing power and the one directional passenger movement in Nigeria, clog the wheel of development of the industry in Nigeria”
Ifeoma Okeke
