Home » Africa: How infighting among Ministry and Unions, domestic airlines stalled Nigeria’s aviation roadmap

Africa: How infighting among Ministry and Unions, domestic airlines stalled Nigeria’s aviation roadmap

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With less than two months to the end of this administration, the Federal Government’s aviation roadmap, which includes the establishment of Maintenance, Repair and Overhaul (MRO) facility, an Aviation Leasing Company (ALC); Agro-Allied Cargo Terminals;

Airport City; National Carrier; Africa Aerospace and Aviation University (AAAU) among others, the lofty dreams of the project are yet to be realised.Industry think-tank group, Aviation Safety Round Table Initiative ( ASRTI) among others has already rated the master plan 2015-2023 below par using campaign promises as key performance indicators ( KPI) to judge the system in that period.

At the Business Breakfast Meeting in Lagos with the theme: ‘Aviation in Nigeria Beyond the 2023 General Elections, Challenges and Prospects’, President of the ASRTI, Dr. Gabriel Olowo, said the future of the Nigerian aviation industry largely depends on how the country deals with the numerous challenges currently impeding its development.

READ: Africa: Nigeria loses $2bn annually over absence of Aircraft Leasing Company in aviation sector

The think-tank gave an appraisal of the industry in the first quarter of 2022, evaluating the response rate to the topical issues treated in its past meeting during the Buhari-led two-term administration and stated that recommendations actually implemented stood at 6 percent while work on progress was 42 percent, however untouched projects remain at 52 percent in eight years.

The bottom-line from their appraisal was that the industry between 2015 and 2023 has performed below par.

Olowo said the status of promises like a national carrier project is stillbirth, the MRO is unborn, while the airport concessioning is inconclusive

Airport concession
The plans by the Federal Government to concession four international airports may not be actualised before the administration of President Muhammadu Buhari elapses, as aviation unions have insisted that government must clear pension arrears of former and present staff of the Federal Airport Authority of Nigeria (FAAN).

READ: Africa: Nigeria’s aviation gets a boost as FCT minister offers 12,000 hectares for development of road map

Daily Sun had earlier reported that union leaders met with the Minister of Aviation, Hadi Sirika in Abuja, where they tabled their demands, that included payment of severance benefits for all FAAN staff and pension arrears owed former and present staff of the agency which at the moment is over N120 billion.

An agency source disclosed that this figure does not include accrued rights from 2017 till date which, if valued, may bring the total amount to N150 billion.
Daily Sun gathered that FAAN generates an average of N70 to N75 billion annually and remits an average of N1 billion monthly to the Federation Account while monthly salaries for the agency’s 8000 staff currently stands at over N2.3 billion.

READ: Africa: Nigerian Aviation Stakeholders call for transparency as FG, investors pump N170.5b in new carrier

It was gathered from industry sources that at the inception of the Pension Reform Act in 2004, the accrued rights of staff stood at N28.3 billion. But the agency didn’t transit to the scheme at the time because it didn’t have the funds. The implication of this is that all current staff of FAAN have no pension in their accounts unlike their counterparts in other aviation agencies since their deductions were not remitted into their PFAs.

When the remittance of the Contributory Pension Scheme (CPS) started in 2007, the agency still didn’t transit but continued paying retirees about N500million monthly from its Internally Generated Revenue (IGR), in violation of the Pension Act. By 2012, however, PENCOM insisted that FAAN should carry out another accrual valuation and when it was done, the amount had increased from N28.3 billion to about N84.3 billion.
But in 2015, it rose to N103.5 billion as more staff had been employed, people were promoted and salaries were increased.

Despite these challenges, Sirika is determined to push ahead with the concession, prompting four aviation unions, Air Transport Services Senior Staff Association of Nigeria (ATSSSAN), National Union of Air Transport Employees (NUATE), Association of Nigeria Aviation Professionals (ANAP) and Nigeria Union of Pensioners (NUP- FAAN branch) to file a suit seeking an order of perpetual injunction restraining him and FAAN from concessioning the airports.

The suit with number NLCN/LA/68/2023 was filed at the National industrial Court and the plaintiffs are challenging the competence of the defendants to concession the terminals, accusing them of ‘usurping the statutory duty of the Board of FAAN which was never inaugurated.

The unions through their lead counsel, Femi Falana Senior Advocate of Nigeria (SAN) are also seeking an injunction restraining the defendants from determining the employment of the members of the claimants without complying with the provisions of the Federal Airports Authority of Nigeria Act (CAP F5) Laws of Nigeria, 2004 and FAAN Reviewed Conditions of Service 2021 in any manner whatsoever. It also claims that the proposed concession of the international airports has failed to address the payment of severance benefits to members of the claimants along with pension arrears owed former and present staff of the agency currently estimated at over N150 billion.

The defendants, according to the suit filed, cannot be justified on the many grounds including the fact that the proposed concession has not considered the very serious implication of handing such important national security assets over to foreigners.
The suit states that the concession is being undertaken by the Ministry of Aviation, and not by the second defendant which negates the concession act. Another ground for suing is that the earmarked terminals require no further investments for the envisaged period of the concession coupled with the arbitrary fixing of profit sharing ratio (60:40) in favour of the concessionaire.

National carrier
At a recent National Aviation Stakeholders Forum which held in Abuja, Sirika, assured that Nigeria Air would take to the skies before May 29. This is despite an interim injunction instituted by the Airline Operators of Nigeria (AON) which restrained the Federal Government and other parties from executing the proposed national carrier and has not yet been vacated.

The AON, which is the umbrella body of airline operators in Nigeria, had approached the court seeking it to interpret the law as it affects the process of procuring the services of Ethiopian Airlines for the operation of the proposed Nigeria Air.

In contesting the process of appointing Ethiopian Airiness for the management of the proposed Nigeria Air, AON argued that the Ministry of Aviation ignored the legally mandatory stages of the public procurement process as stipulated in the law establishing the Infrastructure Concession Regulatory Commission (ICRC).

According to AON, the law mandated the advertisement of the appointment of an operator for the proposed airline in three national newspapers. It told the court that the federal government ignored the law by advertising only in two national newspapers and one foreign newspaper.

AON further argued that the law could be breached only in emergency situations where the National Assembly could not convene to amend it, adding that, there is no emergency in the process of appointing an operator for Nigeria Air to warrant a transgression of the law.

The suit was filed by AON at the Federal High Court in Lagos but the Ministry of Aviation filed to have the suit transferred from Lagos to Abuja. The AON objected to this but on April 25, the hearing on whether the suit will be transferred to Abuja will be held.

The Minister however did not seem to be perturbed by the AON’s lawsuit as he said the government has devised other means to start off the national carrier. He said the project would help tackle the unemployment nightmare in the aviation industry, especially now that scores of young pilots are without jobs.

“50 pilots came to me saying that they had no jobs. We could easily employ them if we have a national carrier. It’s part of the benefits. China is about producing over 300,000 pilots to man its aviation industry. But here, our own pilots are without jobs,” he said.

By Chinelo Obogo,
Source: sunnewsonline.com

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