Stakeholders back FAAN planned passenger tax review

Passengers are to pay more in Passenger Service Charges (PSC) if the proposed increment receives the nod of Federal Government.

The Federal Airports Authority of Nigeria (FAAN) had proposed increment for the PSC and supported three aviation unions in the country.

FAAN has proposed an upward review of the current PSC which was last done eight years ago. The new PSC regime is expected to take effect from January 2019.

The general secretary of National Union of Pensioners (NUP) have FAAN Branch, Comrade Emeka Njoku told journalists in his office in Lagos that the review was over due in view of the the various projects being executed by the agency.

 Njoku stated that acquisition and maintenance of current infrastructure at airports across the country was becoming increasingly difficulty stressing that the only way to survive was for FAAN to adjust upwards its charges to reflect the current value and cost of operation.

Comrade Njoku called for the full commercialisation of FAAN to increase revenue points without any interference from any quarters in order to enable it render better service to the public.

He disclosed that lack of funds was slowing down activities of the organisation saying that there were a lot of wage bills, maintenance of Airports and pensions.

“Equipment are becoming obsolete and they need replacement, this can only be done with funds which is not readily  available”

He remarked that airport concession was not the solution in FAAN but that the organisation should be allowed to get loan from the bank to develop airports across the country for better service.

The National secretary of Association of Nigerian Aviation Professionals (ANAP) Comrade Abdulrasaq Saidu,  said the running cost has increased  and there was nothing wrong  in moving with the trend of events as it will enable FAAN meet up with their quest of providing qualitative service

Saidu said the increment was justified after eight years of the last review stressing that things have changed in the last eight years.

Saidu noted that inflation through these years has drastically affected the cost of doing business,  “Airlines and other airport users have reviewed their charges severally within these period”.

According to him, “We have four new terminals built to international standards, the PSC tariff fixed eight years ago, will not be suitable for these new terminals owing to new technology, maintenance and other related costs”.

He emphasised that passenger traffic has grown by more than 65 per cent between 2011 and 2019. The effect of this increased traffic on the airport facilities , needed to be taken into consideration. But expressed doubt that passengers traffic might drop if the PSC upward review was too high.

Saidu noted that airlines might also be forced to increase airfare if the PSC was raised too high.

He however appealed to passengers not to panic over the move as air travel remained the safest

“The urgent need to begin repayment of the US $500 m (five hundred million Dollars ) China EXIM loan and the US $100m(one hundred million Dollars) DMO facility counterpart funding used in building the new terminals”,

The PSC is collected by the airlines upon purchase of tickets and is paid to FAAN upon completion of the flight.

The charges are used to cover the cost of maintaining common areas in the passenger terminals, providing passenger information, maintaining security and ensuring that customers can use the airport in comfort and with confidence.

The last time PSC was increased was in 2011, eight years ago, when the local currency was more than twice the current value and cost of operation was far lower than what obtains currently.

But the nationsl president of the National Union of Air Transport Employees (NUATE) Comrade Ben Nnabue, getting safety and efficiency are expensive to maintain and to do that he said FAAN must adjust its charges to survive.

“Safety and efficiency are expensive, for FAAN to maintain airport facilities to world class standard, there is need to increase their charges. Most of the fittings in that airports are imported FAAN have increased in their cost”

Nnabue noted that since last increment eight years ago, the value of foreign currencies have increased while the cost of electricity generation and diesel have risen

“Last 8 years you know the value of dollar to naira . You know the cost of generating electricity, you know the cost of diesel” He said .

For the publisher of Aviation Safety Magazine, Alhaji Umar Abdulyekeen, any increment should be done with a percentage that will favour all parties.

According to Abdulyekeen there was need to effect the increase as a result of recent transformation at the airports across the country.

“FAAN is right but I think they should consider the people and the economy because FAAN might have sacrificed a lot of things but it should be with the percentage that will go with all the stakeholders”