N4bn Bailout: Operators Want State-Backed Airlines Excluded
- Aero, Arik, Ibom may be affected
Rather than being a succour for them, airline operators are at loggerheads over modalities for sharing the N4 billion bailout fund approved by the Federal Government for airlines that have faced threat of extinction occasioned by COVID-19 outbreak.
There are indications that state-funded airlines like Aero Contractors, Arik and Ibom may not benefit from the largesse as many private-owned carriers are canvassing for their exclusion from the fund, which they described as ‘too small’ and one that may not solve the myriads of issues confronting the airlines.
The Federal Government had, last week, approved N4 billion as bailout fund for airlines to cushion the effects of the devastation of COVID-19 on their operations.
Aviation Minister, Hadi Sirika, also stated that the Federal Government approved additional N1 billion for aviation agencies to cushion the sorry state of most of them, which has made payment of salaries difficult.
A top official of a state backed airline told our correspondent under strict condition of anonymity that this matter was capable of tearing the seemingly fragile relationship of the carriers apart, saying that the Ministry of Aviation may have concluded plans to buy into the argument not to support them.
The source further disclosed that a popular airline operator, apparently with huge number of Boeing aircraft and another with dominant operations in the northern part of Nigeria are alleged to be the arrowhead of the plan to exclude state-funded airlines.
According to the source, “It is true that there is a grand plan to exclude state-backed airlines like Aero, Arik and Ibom Air from the bailout.
The target is really Ibom Air, because they believe that the carrier is already funded by the state government.
“Two operators are at the forefront of this action and it is like the Ministry of Aviation is listening and buying into that argument. But what we should realise is that in other climes, there is no discrimination in assisting airlines in whatever form they come from stimulus funds.
“We know how troubled airlines are at this period of COVID-19. It will be unfair to exclude some carriers from the bailout fund.”
The argument, according to the source, is that since the state-backed airlines enjoy massive government support, it would be a great disservice to others that struggle without any ‘form of government’s support.’
They also argued that it would amount to unfair treatment if the Federal Government goes ahead to share the fund with them, describing it as ‘over protection’ of government-owned airlines against privately owned carrier, just as they thanked government for the gesture to assist them at a critical period occasioned by the serious impact of coronavirus on their investments.
Meanwhile, it is not clear yet how the N4 billion is going to be shared among the airlines and who the beneficiaries are going to be.
It is also not clear yet the modalities government would apply for the disbursement of the fund. But one thing is clear; Azman, Max Air, Dana, Overland and Air Peace are going to be major beneficiaries. Should government have a re-think, Arik, Aero and Ibom could also partake in the sharing of the fund.
Just recently at a webinar, the Director-General of the Nigerian Civil Aviation Authority (NCAA), Captain Musa Nuhu, gave a condition that only airlines with functional Air Operators Certificate (AOC) would be allowed to enjoy the proposed bailout fund.
Nuhu, who said the bailout fund would be accessed by every entrepreneur across the sector, however, declared in line with government policy guidelines that only functional airlines will benefit from the palliative fund when eventually released.
He, however, urged the domestic airline operators not to repeat a similar mistake of allowing dead airlines to have access to the funds, saying “any airline can apply, whether functioning or not, but it is a policy that participating airlines must be functioning and with Air Operators Certificate (AOC).
“I also believe that the AON has its own rules and they know the criteria. I believe AON will not put forward a non-functioning airline. I also believe that AON has its own rules and they know the criteria,” he said.
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