‘Monies govt. agencies collect from airlines not well utilised’

Getting foreign exchange to run our business is very difficult. We require it to do business and it has become very difficult to come by. Times are hard. We are trying our best. Airline business is capital-intensive, everything in aviation is dollarised.

We import everything we use, from the spare parts to jet fuel, which is not refined locally. Even in the good times, all these were imported, but the cushioning effect in the past is that, at least, the local currency, which we traded, was a bit stable, but of recent, naira has collapsed.

So, what we pay for both spare parts and maintenance has gone up the roof and this affects what customers pay as well. Aviation has the potential to contribute, at least, four or five per cent to our Gross Domestic Product (GDP) in Nigeria, which is now the second biggest economy in Africa. If maintenance were done in Nigeria, we would not have wasted money abroad.

But now, we have to spend almost a million dollars on each air plane. The money is coming from the naira that we are trading. So, it is very difficult for us. We are a private business, once the policies are correct, we will make headway.

So, we need government support in the sense of making the right policies. Recently, Ghana reduced the price of aviation fuel by 20 per cent but government here says it is deregulated, but the currency is dropping every day. We should be looking at the Nigerian economy.

Well, from Dana perspective, we want to see a Dana Airline that will be here for another 50 years, just like Aero that has existed for over 50 years now. Airlines do not owe because they want to owe.

Sometimes, it is because some of those charges are duplicated. Why do we do reconciliation? This is because they do not know what we owe. We are only surviving despite the economic challenges.

Aero is the oldest commercial airline and it is finding it difficult today because of some of the unfriendly policies we have in the sector. Dana Air has wide range of skilled staff and in terms of customer satisfaction, we are always on the top and we make sure we get very skilled people and we give them enough training.

Aviation fuel takes over 40 per cent of airlines’ revenue. There is the need to refine jet fuel locally. Currently, a lot of the supplies are imported. There are import problems, which are causing scarcity.

If we can refine locally, there will be excess supply to satisfy growing demand. Secondly, government should make that zero per cent on import work so that when something lands from Abuja, Kano or the seaports, the airline should have their parts in less than five hours.

The policies on maintenance should be such that we could get our parts and equipment, in and out of the country. There should be nothing that stops Dana Air, for instance, from taking a land in Lagos and building a hangar. But because the policies do not work, it is not viable.

From an airlines’ point of view, I believe that five per cent of what we pay as charges should be completely done away with because we pay the regulators for everything that we do.

We pay for aircraft registration, pilot licences, approval of manuals and approval of simulators, amongst others. There is a contentious issue of five per cent on tickets sales.

The Nigerian Civil Aviation Authority (NCAA) says it is from the five per cent on ticket sales it finances itself. I am a supporter of the independence of the regulators and advance economy supports that regulators should be independent from government so that they do their job properly. They have to fund themselves somehow. Any service that the airlines need from regulators, they pay for it.

If we want to get a pilot’s licence approved, we pay for it and that is how it is done in other countries. You pay for certain services. Apart from these charges, five per cent on ticket sales is also being deducted in Nigeria.

The five per cent does not exist anywhere else. The five per cent is hard work of the airline. If I do my customers service properly, do my marketing right and do my staff training, amongst others and I charge my passengers, it is my hardwork, not the regulator’s.

The five per cent on ticket sales is shared among Nigerian Airspace Management Agency (NAMA), but NAMA also charges every airline separately from the percentage taken from the ticket sales on navigational aids per kilometre.

They have a second charge called the terminal navigation charge, for using the radars. So, why impose double taxes? What is the need for the double taxation? In foreign countries, aircraft manufacturers can manufacture aircraft with a particular maximum take-off weight.

You could purchase the same airplane with maximum take-off weight of 100,000kg but another airline can purchase the same airplane with maximum take-off weight of 120,000kg, but he will carry a bit more weight. Take-off and landing are charged by weight.

Dana has five airplanes with different take-off weights, but the Federal Airports Authority of Nigeria (FAAN) has charged us, all the airplanes, at the maximum.

We are in dispute with them for overcharging because they go to website and start charging, but FAAN has agreed to it. So, there is a lot of that double taxation.

Another issue is the fact that the money being collected from the airlines are not well ustilised for the good of all. For instance, if I pay taxes and I see where my taxes are used, I will be happy to pay taxes, but if I do not see where they are being used, then we have a problem with that. The day we can see where our money goes, nobody will complain of anyone owing.

The airlines are prepared to pay once it is transparent and government can justify the collection of many taxes and charges imposed on airlines to improve airport infrastructures.

But the government agencies responsible have not been able to justify what they collect from the operators. Once we begin to see the results of the taxes and other charges they collect, we will pay, once everything is clear.

We are Nigerian airline and we want to be everywhere. Our new route is Owerri. We are expanding gradually, as we focus on our operations. You will recall that we first operated to Owerri in 2014, but ceased because we had to take one of our aircraft out for maintenance.

The airplane is back, so, we had to re-open the Owerri route. We looked at the domestic market where there is demand. We have customer feedback all the time.

Every seat has a customer feedback form. We read every feedback, good or bad and we reply. What also counts for us is the fact that we changed our menu every two weeks and keep them fresh.

Our service on board is the best in the country. We collate all these, sit back and access our areas of service and where it is profitably reliable. Owerri is one point we felt is a big enough market. Some people in Rivers, Bayelsa, part of Enugu and Anambra states use Owerri as their point of travel.

Dana Air is in Owerri to stay. We are doing well on that route and we have lifted over 110,000 passengers on board and we just started three weeks ago and we are quite happy with the performance of that route and it will only grow from strength to strength.

We insure the aircraft, the staff, the pilots and cabin crew. Every passenger that buys a ticket on the airplane is also insured. Every year, as the law requires, Dana Air buys enough insurance to cover our liabilities such as the passengers, the luggage, passenger injury or life. In respect to the accident, the insurance company handles the insurance.

What we do, till now, is that we liaise with the insurance company, ensure that every question from the families of those affected is answered. The insurance companies have lawyers that work for it.

Dana air is saying that documentations have to be done. Immediately an accident happens, by law, without questions, everybody gets paid a certain amount. Currently, it is $30,000.

That was done for all the families. The insurance company paid everybody that first part. Going further, families then had to fill in certain documentations, especially with regards to who the actual next of kin is.

All the families that did the necessary things, such as doing the necessary registrations, getting all the probates, were paid. Those doing legal proceedings, the insurance company had to stop any further action until the legal proceedings were completed. Everyone who completed the processes and has no legal impediments has been paid.

We survive and work in our environment and whatever shocks the economy will face, we will always have plans. The current and biggest shock in the economy is naira devaluation because this affects us the most.

We are closely watching what happens with the new forex policy and we are making plans on how we can survive going forward. Our hope is that going forward, things will get better.

We had a very tough July because of the fuel scarcity, but one thing that stood for us is that while airlines were cancelling flights, Dana Air operated 95 per cent of its scheduled flights. For those with delays, we made sure we got messages out to customers and they understood.

There were very little disruptions or bad will from customers. We kept passengers informed and made sure people were fed and watered when they needed to be.

Part of Dana Air’s standard operating procedure is that after a one-hour delay, everybody gets delay parks, after two hours, if people are tired and do not want to fly again, they get their monies, 100 per cent. Going forward, this August is looking bright and we thank our customers for always showing understanding. We hope that things will get better.

Are there new areas where you want to commence flight? Our footprint in Nigeria covers Lagos, Port Harcourt, Uyo, Owerri and Abuja and in three years or less, a few places in the northern part of the country will be covered.

We had plans to go into the north eastern part of the country, but we had to stop because of insecurity. However, with better security, we will cover two or three locations in the northern part of the country and we will move further.