For the past five days, airline operators and aviation agencies in Nigeria have been pointing fingers at each other over a total debt of 23 billion Naira accumulated over the years until August 30th, 2022. I didn’t want to comment on the dispute between two respected industry stakeholders because the two are like husband and wife. However, it is critical that an issue like this is not left unaddressed by all stakeholders because it has the potential to paralyze the industry.
One of the Bills recently ascended to law by the President, Major General Muhammadu Buhari (Retd.) is the “Civil Aviation Act, 2022: This Act repeals the Civil Aviation Act, No. 6, 2006, and enacts the Civil Aviation Act, 2022, to provide for an effective legal and institutional framework for the regulation of civil aviation in Nigeria in order to promote aviation safety and security, ensure that Nigeria’s obligations under international aviation agreements are implemented, and consolidate the law relating to civil aviation regulation in Nigeria; provide for an effective legal and institutional framework for the regulation of civil aviation in Nigeria in conformity with the standards and recommended practices set by the International Civil Aviation Organization (ICAO); and establish rules of operation and divisions of responsibility within the Nigerian civil aviation system in order to promote aviation safety and security; ensure that Nigeria’s obligations under international aviation agreements are implemented; and consolidate the laws relating to the regulation of civil aviation in Nigeria.
PART V – Section 12 (1) of the Acts said: there shall continue to be a 5% air ticket contract, charter and cargo sales charge to be collected by the airlines and paid over to the Authority and
PART VIII – Section 27. (1) Said: the Authority shall have power to carry out investigations into complaints, and/or occurrence(s), save for accidents and serious incidents, after due notice to the person(s) concerned. (2) If the Authority is satisfied after such hearing that such person(s) is or are violating any provisions of this Act, regulations, rules or orders, as the case may be, it shall by order require the person(s) to take such action consistent with the provision of this Act, regulations, rules or Power to Investigate, impose fines and enforce 14 orders as may be necessary in the opinion of the Authority to prevent further violation of the provisions of this Act, regulations, rules or orders. (3) The Authority shall have power to take all steps reasonably necessary, including the power to ground any aircraft and to seal the premises of any air transport service provider or provider of allied aviation service, in order to ensure compliance with the provisions of this Act and the regulations, rules, and orders made pursuant to it and
PART IX subsection a, b, c said and I quote: Notwithstanding the provisions of subsections (1) and (3) of this section, the Authority shall have and exercise the powers generally to: (a) regulate, supervise and monitor the activities of Nigerian and Foreign carriers, travel and other aviation agents operating in Nigeria, and to keep a register in respect thereof; (b) require periodic statistical/financial and special returns and special reports from any air carrier; prescribe the manner and form in which such reports or returns shall be made, and require from any air carrier-specific answers to questions upon which it deems information may be necessary; (c) prescribe the form of financial records and memoranda to be kept by air carriers including accounts records and memoranda of the movement of traffic and the receipt of and expenditure of money and length of time such accounts, records and memoranda may be preserved.
Based on the provisions listed above, I believe the current government has done well for the industry by enacting this Act. The onus is now on the agencies and stakeholders to ensure full compliance.
The fact that it is not explicitly stated in the bill, section 27 subsection 3 suggests that airlines may use technology. “The Authority shall have power to take all steps reasonably necessary, including the power to ground any aircraft and to seal the premises of any air transport service provider or provider of allied aviation service, in order to ensure compliance with the provisions of this Act and the regulations, rules, and orders made pursuant to it.”
This implies that it is entirely reasonable for the Authority to adopt technology to automate the process of remitting funds collected by airlines to them.
Despite the fact that airlines are required by the DG NCAA to sign a Memorandum of Understanding (MoU) with the NCAA outlining repayment plans for their debts to the organization, I do not believe this will solve the problem because airlines that are struggling to pay for fuel and aircraft maintenance are not in a position to honor additional financial commitments. As a result,
- I propose that the airlines sign an MOU with the agency to establish an automated reconciliation extension unit on their existing platforms, where statutory funds are automatically remitted to a consolidated account and a reconciliation committee meets monthly to reconcile and confirm figures.
- The airlines can charge the agencies a service fee of 2.5% for collecting funds from passengers on their behalf; this will encourage airlines to remit funds on time.
- As the industry’s senior stakeholders, the agencies should provide relief to airlines that are willing to pay off their debts.
- Furthermore, before comparing fees with other countries, I recommend that the agencies make an effort to ensure that the quality of their services is commensurate with their fees.
Finally, I am urging all stakeholders to put pressure on airlines and agencies to implement automation in all areas of the industry in order to reduce the system’s exposure to human factors. If the agencies are properly funded, the quality of their services will improve. If we all decide to do business properly, the aviation industry in Nigeria can still be very profitable and efficient. Feel free to comment, criticize, and follow us on our social media handles until we improve the Nigerian aviation industry