Airlines’ N46.4bn Toxic Debt Threatens Air Navigation, Aerodrome Mgt, Regulatory Services

Capt Musa Shuaibu Nuhu, Director General, Nigerian Civil Aviation Authority, NCAA

The cumulative debt portfolio of Airline Operators of Nigeria, AON members, has been put at a whooping sum of N42 billion and $7.8 million USD respectively, with the burden too much for the service providers to continue to endure.

Capt Musa Shuaib Nuhu, Director General, DG, Nigerian Civil Aviation Authority, NCAA, made the disclosure at a parley by the federal government agencies with the indigenous airlines and ground handling companies in Abuja on Tuesday.

He told his august guests that the debt volume was about to choke the agencies to extinction hence, called for an urgent resolution on how the liquidation of the debts will begin with all seriousness to enable the agencies to continue in service and not go defunct.

Nuhu ordered a one-month ultimatum beginning on Tuesday, 30th August 2022, and added the operators will be compelled to sign a Memorandum of Understanding (MoU) with NCAA, which would stipulate the repayment plans of their indebtedness to the authority.

L-R: Mr Mathew Lawrence Pwajok, Ag Managing Director, NAMA, Capt Rabiu Hamisu Yadudu, Managing Director, FAAN, Capt Musa Shuaibu Nuhu, Director General, NCAA, at FCT, Abuja, addressing the Chieftains of Airlines Operator of Nigeria, AON 30th August 2022

He said the total debt to NCAA by the indigenous airlines on the statutory 5 per cent Ticket Sales Charge and Cargo Sales Charge, TSC/CSC, had risen to over N19 billion and $7.8 million respectively in the last few years.

Bewildered Capt Nuhu groped for answer as to why the airlines would collect upfront from passengers, the Ticket Sales Charge and the Cargo Sales Charge, TSC/CSC, yet, would not remit as at when due?

The number one aviation industry regulator in Nigeria lamented thus, “the airlines have intentionally refused to pay the debts owed us despite the fact that they have collected such from the passengers. The airlines collected money and refuse to transmit such to the right authorities. AON wants us to provide services for free for them. What the airlines are trying to do is to make NCAA become defunct”.

In the same vein, Mr. Mathew Pwajok, the Acting Managing Director, Nigerian Airspace Management Agency, NAMA, announced that the airlines were owing over N5 billion for air navigation services offered for their safe and smooth operations.

Also, Capt. Rabiu Yadudu, Managing Director, Federal Airports Authority of Nigeria, FAAN, disclosed that the airlines owed the agency a little over N18 billion and debunked the claim that it charged the airlines indiscriminately as claimed in a letter of protest.

However, the Director General NCAA, Capt Musa Nuhu, while reacting to a protest letter from the AON to Sen Hadi Sirika, Minister of Aviation, expressed disappointment over a letter, which he noted wrongly accused the agencies of levying the airline with multiple charges.

Nuhu was specific about the letter which was signed by the President, AON, Alhaji Abdulmunaf Yunusa, dated 8th August 2022, that it contained total falsehood which AON members had opportunity to clarified but chose to feed the minister with lies and half truths.

The DG took exception to the accusation that the agencies, especially the NCAA was muzzling the operators out of steam through multiple charges.

Hence he offered the AON chieftains present tutorial on charges, explaining that all the charges collected by NCAA were statutorily and in compliance with the Civil Aviation Act 2006.

The NCAA helmsman explained that for any of the charges to be repealed, it would have to go through the National Assembly and must be assented to by the President of the Federal Republic of Nigeria.

He also decried that out of the 5 per cent TSC/CSC, the agencies still remit 25 per cent of their revenues to the Consolidated Revenue Account created by the Federal Government and advised the operators to always crosscheck their facts before going to the public arena.

He added: “NCAA relies 100 per cent on its Internally Generated Revenue (IGR). The 5 per cent TSC paid by passengers is 85 per cent of NCAA revenue, while the other 15 per cent comes from airlines as payment for services provided and they are all cost recovery. We don’t also impose any excess baggage charge on the airlines. I wonder where the operators saw this”.

Responding, Alhaji Kashim Bukar, the Managing Director, Skyjet Airline, wondered why the DG NCAA brought the issue to the public glare.

He said that rather than make it a public issue, NCAA should have called the operators into a closed door meeting to discuss the issue.

Also, Capt. Edward Boyo, the Managing Director, Overland Airways and a trustee of AON, apologized to the NCAA for the letter.

“I’m a trustee member of AON. On behalf of AON, I hope to apologize to you on the letter. The letter wasn’t intended to have this effect. Some parts of the letter were inappropriate. We apologize and I want to crave your indulgence to drop the issue,” he said.

Besides, Mr. Allen Onyema, the Vice President, AON, and the Chairman, Air Peace, said he was seeing the letter for the first time and expressed disappointment with some of the contents in it.

He regretted that there are factions in AON, which had prevented them from speaking with one voice.

Onyema agreed that he was at the meeting with the Ministry of Finance and Aviation where the issue of skyrocketing price of Jet A1 was discussed, but insisted that no one maligned the image of NCAA or any aviation agencies at the meeting.

The Air Peace founder said the AON as a corporate entity was not going to ruffle the feathers with anyone nor with any of the aviation aganecies.