Hope Dims On Recovery Of N45bn Airlines’ Debt

 ●Loans may end up as bad debts

Hope seems to be dimming very fast on how the aviation industry could recover over N45 billion from airlines indebted to virtually all the agencies, especially at a time COVID-19 has wreaked havoc on airlines across the globe.

Meanwhile, there are fears that greater part of that amount could end up as bad debts as many carriers could join the ones that are already extinct as a result of Coronavirus that has grounded airlines and economic activities around the world.

A source close to the Federal Airports Authority of Nigeria (FAAN) told Woleshadarenews under condition of anonymity that the agencies may look beyond the carriers if they hope to get funds, stressing that the current situation occasioned by COVID-19 had put the agencies in precarious situation.

Aviation agencies, including Nigerian Civil Aviation Authority (NCAA), Federal Airports Authority of Nigeria (FAAN) and the Nigerian Airspace Management Agency (NAMA), are unable to replace obsolete airport equipment, resurface dilapidated runways and provide other amenities to the airports, because of N45 billion debt owed by domestic airlines.

Woleshadarenews learnt that with no subvention from the Federal Government, these agencies depend on revenue generated to pay salaries for their workers, execute safety and critical projects and conduct training for manpower development.

With such huge debt profile, FAAN said it was finding it very difficult to replace obsolete airport equipment like airfield lighting, resurfacing of dilapidated runways and provision of other amenities to the airports.

Despite the deadlines and threats, the authorities have not been able to match their words with actions to compel the carriers to remit Passenger Service Charge (PSC) they collect on behalf of the agencies, particularly FAAN to the appropriate parastatal.

Investigation by shows that as at last year, the airlines owed FAAN about N26 billion, which accrued from landing and parking charges, rent, electricity, concession fees and others, which are the services provided to the airlines by the agency.

NAMA also stated that domestic airline owed the agency N5.72 billion while aerodromes owe it N2.38 billion, making it a total of N8.117 billion.

The debt incurred by airlines include en-route charges and aeronautical charges and aerodrome charges including air traffic control services rendered to most private and state airports.

The Managing Director of NAMA, Captain Fola Akinkuotu, recently disclosed that these debts impinged on the agency’s operations because maintaining uninterrupted power at the airports and outposts costs NAMA huge amount of money and urged the airlines to pay off the debts.

Worried by the huge debts of airlines to the agency, the Managing Director of FAAN, Capt. Rabiu Yadudu, during an interactive session at the National Assembly last week, appealed to the airlines to settle their debts.

This came as the House of Representatives Committee on Aviation condemned the deliberate withholding of levies collected on behalf of FAAN by some Nigerian airlines.

The Ccommittee chaired by Nnolim Nnaji representing Nkanu East/West Federal Constituency of Enugu Sate had summoned him to explain the rationale behind the 100 per cent increase in passenger service charge, (PSC) announced by the airport authority in preparations for the partial lifting of domestic flights across the six geopolitical zones of the country.

The service charges were raised from N1000 on local flight to N2000 and from $50 to $100 on international routes.

The committee though convinced that the increase in PSC was inevitable based on the challenges posed by the COVID-19 on the industry was, however, alarmed to learn that one of the indigenous airlines was yet to remit to FAAN the sum of N13 billion collected on behalf of the authority.

The committee in a unanimous resolution has decided to invite the airlines to come and defend the allegation even as it demanded that the management of FAAN provides it with details of the debt profile of the affected airlines latest by July 7,2020.

Nnaji, who described the attitude of some indigenous airlines as regrettable, assured FAAN that his committee would look into the matter with a view to resolving it so that the authority can carry out its statutory duties of providing world class services to air travellers unhindered.

Wole Shadare