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An alleged conflict of interest between the Ministry of Aviation and the Assets Management Corporation of Nigeria (AMCON) over the floating of NG Eagle may truncate the setting up of a national carrier promised Nigerians by President Muhammadu Buhari administration as the clock is fast ticking on the project.
While AMCON is on the verge of setting up NG Eagle out of Arik Air which is indebted to the Federal Government to the tune of N300b and which necessitated the assets managers take over the toxic debts, the Minister of Aviation, Senator Hadi Sirika is also at the verge of settling up Nigeria Eagle and the fear that AMCON’s airline may take the shine over the one by Sirika.
The National Union of Air Transport Employees (NUATE) averred that it would rather not be involved with the war between the Ministry of Aviation and AMCON over the burning question of establishing a national carrier but said the intervention of the Presidency on the matter has become urgent because of the high stakes for Nigeria.
Many argue that the Ministry has taken all of six years, and still counting, to form a national carrier that will not be owned by Government, but AMCON utilised a few months to achieve the objective, though, the nature of the Ministry’s effort is very obvious to aid comparison.
The petition by the Association of Nigerian Aviation Professionals (ANAP) and the Federal Airports Authority of Nigeria, (FAAN) branch of the National Union of Pensioners, (NUP) to the Chairman, House Committee on Aviation, Nnolim Nnaji, to halt the strenuous AOC process that had reached an advanced stage of the award by the Nigerian Civil Aviation Authority (NCAA) had been condemned by stakeholders that such action could erode the autonomy and independence of the aviation regulatory body.
They insinuated that AMCON, the receiver-manager of Arik Air, was using the assets of the Airline to float NG.
The House of Representatives Committee chairman, Nnolim Nnaji was of the opinion that the Federal Government would lose revenue if Arik failed to pay its debt to FAAN in the form of 25% statutory remittance to the Federal Government by FAAN.
NUATE at a crowded press conference at the Lagos airport said information available to NUATE however, suggests that the issue of indebtedness of Arik Air to FAAN and the NCAA was only a smokescreen.
General Secretary, NUATE, Ocheme Aba stated it was understood that the real issue was the politics of a new national carrier, alleging that indications are that there is the fear on the side of the Minister of Aviation that AMCON has positioned its new airline, NG Eagle, to metamorphose into a national carrier, “whereas the Minister has been laboring for the past six years to create one which he has named Nigeria Eagle”.
“As AMCON and the Ministry are both agencies of the Federal Government, there is clearly no possibility of the two airlines operating side by side as national carriers. The fear is that if NG Eagle succeeds, then the Nigeria Eagle project would be jettisoned. That means one of the airlines must bulge. This, we understand, is the crux of the matter”.
He reiterated that the main purpose of the press conference was to call the Presidency which is the apex of the Executive Arm of Government to duty over what he described as ‘serious malady in order to avert a major mishap in the aviation sector.
In particular, NUATE called on the Secretary to the Government of the Federation (SGF) and the Chief of Staff to the President (CoS) to urgently intervene in these matters and facilitate an immediate cease-fire and chart a path to progress on the sensitive issues.
Director of Media, Ministry of Aviation, Dr. James Odaudu said the union’s allegations were baseless, saying that the Minister of Aviation is not in any way in the way of any private carrier that wants to begin air transport services.
Odaudu further stated that Sirika has always encouraged people to invest in the airline business; a situation that has led to many new entrants into the aviation sector and wondered what the Minister got to gain in putting a stumbling block on the way of any airline and at a time he had given the NCAA a free hand to carry out its duties without interference.
His words. “I have read the comments coming from NUATE and wondered how they arrived at their position considering the fact that the Minister has done a lot to ensure that there are more airlines. How does the floating of a private airline by AMCOM stop the project of a Minister? he asked.
On the intervention of the Presidency on the precarious situation, Aba noted that it is already within the public domain that AMCON is presently executing receivership management over Arik Air as ordained by a competent court since 2016.
He said this came about by the airline’s insolvency as a result of a heavy debt pile, stressing that at the last count, Arik Air’s debt burden is in the region of N300b whereas the airline’s assets are worth only about half of its total debts.
“What this means is that Arik Air is unable to pay its debts. And it cannot under any circumstances. This is a solid fact that cannot be altered by the denial of AOC to NG Eagle. The point here is that Arik Air or AMCON cannot raise N19b being demanded by FAAN and the NCAA”.
“It is honestly unhelpful to create enmity with FAAN or NCAA for Arik Air or AMCON since the airline will always need the support of the two agencies to survive. Therefore, those proposing that AMCON’s NG Eagle’s Air Operator Certificate should be on hold until Arik Air’s debts are settled are only pushing AMCON to the wall and that is towards liquidation. Considering the airline’s low worth compared to its huge debts, liquidation will bring about a chaotic end to Arik Air by which all parties will be losers. This should be avoided by all means”.
“Therefore, the intervention of the Presidency is needed to foster understanding on the issue of indebtedness of Arik Air to FAAN and other Government agencies with a view to aiding AMCON to continue with its rescue efforts in the airline which is the best option for now to safeguard all interests”.
“Should there be a chaotic end to Arik Air by way of liquidation; the workers would count among the greatest losers. You are all witnesses to the untold hardship that befell ex-workers of the defunct Nigeria Airways after the airline was unceremoniously liquidated by the Obasanjo regime in 2014.
“It took an intervening period of twenty years and spanned four governments – the governments of Obasanjo, Yar’Adua, Jonathan and Buhari – before the hapless workers began to get some reprieve in terms of their terminal benefits. No one should be so wicked as to wish a similar experience for Arik workers. Therefore, the intervention of the Presidency is urgently needed to grant AMCON the space to continue to protect the employment of over two thousand employees. This will also afford the unions and the management to negotiate severance benefits for Arik workers; a process that is presently at concluding stages”.
Aba lamented that the denial of AOC to NG Eagle would shut 20, 000 potential jobs for Nigerians, together with the opportunity for a reasonable number of Arik staff to migrate to the new airline.
“This would be very unfortunate indeed. The intervention by the Presidency will avert such a catastrophe. And for NUATE as a trade union, this is exceedingly important. We feel all trade unions, including ANAP, should have the same view”.Google+