N500bn Drain:  Reclassifying NCAA as a cost-recovery body critical for safe skies

Under the sweeping automatic deduction policy, an estimated N500 billion ($362 million) derived from the 5% Ticket Sales Charge (TSC) and Cargo Sales Charge (CSC) has been systematically drained from the agency into the Consolidated Revenue Fund and the Treasury Single Account (TSA).

To bureaucrats in Abuja, this half-a-trillion-naira windfall looked like an unearned operational surplus ready to plug federal budget deficits. But to anyone with a firm grasp of civil aviation, this fiscal policy is a catastrophe waiting to happen.

Aviation experts and industry stakeholders who spoke to Aviation Metric over the weekend warned that treating a safety regulator as a revenue centre undermines the core tenets of international civil aviation governance.

A member of the Board of Trustees of the Airline Operators of Nigeria (AON) and President of Top Brass Aviation Limited, Roland Iyayi, urged the Federal Government to halt the mandatory deductions and allow funds to be ploughed back into sector development.

“How can the NCAA be expected to contribute massive revenue into the Federal Government’s Federation Account? The argument is straightforward: the NCAA is not a revenue-generating agency. It is a regulator and should never compete with commercial service providers,” Iyayi stressed.

This stance highlights a critical principle of global aviation governance: the strict separation between statutory regulatory oversight and commercial revenue generation.

Echoing these concerns, aviation security expert Group Capt. John Ojikutu (retd.) maintained that when a civil aviation regulator is forced to act like a revenue collector or relies on cost-recovery targets from the very entities it regulates, it risks compromising its primary mandate of safety, security, and statutory oversight.

“The argument must remain clear: the NCAA is not a revenue-generating agency. The 50% automatic deduction must stop so these funds can go directly into developing our aviation infrastructure,” Ojikutu stated.

A veteran accident investigator, who spoke on the condition of anonymity, noted that civil aviation authorities worldwide were never designed to generate profit for central governments. Instead, they are built on a cost-recovery model to fund the invisible, high-stakes work of safety oversight.

“Every naira derived from passenger ticket charges is statutory money meant for a single purpose: keeping planes in the sky and preventing mid-air disasters,” the investigator explained. “By draining those funds to line general government coffers, the state forces the regulator onto a starvation diet—leaving critical safety inspections, radar upgrades, and airspace communication equipment underfunded.”

If the Federal Government heeds these persistent warnings and halts the mandatory revenue siphon, it would mark a landmark policy shift for Nigerian aviation.

Reclassifying the NCAA in accordance with International Civil Aviation Organisation (ICAO) standards from a revenue generator to a strictly cost-recovery regulatory body would yield transformative benefits across the sector, such as ring-fenced funding that allows the 5% TSC/CSC pool to remain entirely within the aviation ecosystem rather than disappearing into non-aviation government accounts.

They averred that, with uncompromised regulatory oversight, the authority could comfortably finance ongoing inspector certifications, routine airline audits, and mandatory ICAO safety compliance programs without begging for emergency allocations.

 For upgraded airspace infrastructure, sister agencies like the Nigerian Airspace Management Agency (NAMA) would, to them, receive their full, undepleted statutory allocations, thereby enabling long-overdue modernisation of radar systems, Instrument Landing Systems (ILS), and communication towers nationwide.

Domestic operators, long burdened by multiple taxation and substandard infrastructure, would finally see their passengers’ 5% charges reinvested into safer skies, faster turnaround times, and modern navigational aids.

They reckoned that by shifting from fiscal exploitation to regulatory support, Nigeria can ensure its aviation sector meets international safety benchmarks while building an airspace network fit for the future.