For many years, Nigeria’s aviation sector was in shamble. Poor equipment, decrepit airport facilities, unreliable revenue generating and collection system and unfriendly workforce, all combined to make the sector distressed.
To say the least, the state of the country’s over 22 airports owned by the federal government before the year 2011 was deplorable. And though attempts were made to reposition the sector by the previous administrations, the conditions of the airports did not change much.
From dilapidated, crammed, antiquated, poorly-maintained, decrepit terminals to obsolete weather forecast equipment, the sector was in doldrums.
At the airports, conveniences, air-conditioning systems, car parking lots, cargo-handling, luggage conveyor systems and other passenger handling systems and alternative power supply systems had become comatose.
But a little over two years ago the sector began to see a remarkable change. For instance, 22 airports across the country got needed facelift that changed travel experience for most passengers. Not only that, there has been a boost for infrastructure in the sector with replacement of obsolete equipment for modern one. Indeed, global players were attracted as investors into the sector. The Chinese for example signed an MOU with Nigeria to finance the construction of 11 new state-of-the-arts airports across the nation, out of which 6 will be for perishables. To that end, the sector became the pride of everyone.
From Lagos to Yola, Port Harcourt to Enugu, the quality and pace of work took the aviation sector by storm. For once, the national pride of Nigerians was restored and the nation’s standing in the comity of nations was sustained. Now, high-wired politics that stopped the reform with the removal of the former Aviation Minister, Stella Oduah may be impacting on the expected progress within the sector.
Just recently, the House Committee on Aviation claimed that a huge debt to the tune of N174.6 has been incurred by the Ministry of Aviation, calling it ‘unsustainable,’ though sources at the ministry have denied that calling it a ‘mere witch-hunting bitter politics.’
The committee, led by its chairman, Nkiru Onyejeocha, expressed dissatisfaction with the ministry’s debt burden when it went for its oversight function at the ministry and its agencies recently.
Onyejeocha equally denied knowledge of the aviation master plan which has guided the reform witnessed so far in the sector.
She said: “I wish to state here that the committee frowns at such debt profile because we know that monies have been appropriated for most of the projects that you have been doing in aviation. It’s scary to have a debt profile of N174 billion in the Ministry of Aviation.”
The committee members had expressed concern that most of the projects done were to remodel the airport terminals and not to provide equipment that would improve the safety of flights in the country.
In response, the supervising Minister of Aviation and Minister of State for Commerce and Trade, Mr Samuel Ortom, said that the alleged debts were not incurred by his administration since it has not awarded any contract and does not intend to award any until it has addressed the alleged huge debts.
But it seemed that the current supervising minister for the aviation sector may be having challenge with understanding the mechanism of the reform since his redeployment to the sector was only a few months ago. The Permanent Secretary, Dr Jamila Shuara whose understanding of the aviation leaves much to be desired, is not helping matters.
Indeed, available documents from the Ministry of Aviation shows that the debts in question refer to the Loan of US$500m from China Exim Bank and the Eurobond Loan of US$100m which would both be liquidated from the proposed Airport Development Levy of US$10.00 (International Passengers’) and N1,000(Local Passengers), with a 5 year projected income
According to the document, funding sources for the reform in the aviation sector include BASA funds, Appropriations, Internally Generated Revenue (IGR) other sources of funding such as proposed Airport Development Levy and Security Surcharge.
For the BASA funds, there was a presidential approval for Presidential Priority Projects in Aviation, which conveyed approval for utilization of the sum of N60m in the BASA Fund and was submitted to the National Assembly for appropriation to be supplemented by a further N14.6b from the IGR of Federal Airport Authority of Nigeria (FAAN).
Consequently, the Senate Committee on Aviation via a letter of May 16th, 2011 written to the Minister of Aviation approved the utilization of the US$60m from BASA Funds. The letter was signed by the Chairman, Senate Committee on Aviation and the Chairman, House Committee on Aviation.
And the Senate and House of Representatives Joint Committee on Aviation in another letter dated June 10th, 2013 written to the former Minister of Aviation, Stella Oduah, conveyed its Approval/Appropriation of utilization of the BASA Funds of N25b for the ministry’s project execution.
The letter was signed by both Senator Hope Uzodinma and Hon. Nkeiruka Onyejeocha, as Chairman, Senate Committee on Aviation and Chairman, House Committee on Aviation respectfully.
In the same vein, the State House, Abuja through a letter to the Coordinating Minister of the Economy and Minister of Finance conveyed approval for the procurement of critical infrastructure such as perimeter fencing, airfield lighting, water hydrant systems and fire-fighting equipment. The letter signed by the Chief of Staff to the President stated:
“US$500 million earmarked for the Aviation sector in the negotiated loan from China EXIM Bank should be used for the construction of four new terminal buildings at Lagos, Abuja, Kano and Port Harcourt Airports. The Current balance of N175billion Power and Aviation Intervention Fund (PAIF) N75 billion should be allocated to the Aviation Sector. Additional funding of N25billion from BASA Fund to be made available for urgent infrastructure upgrades (BASA Fund currently has accrued revenue of about N30billion).”
For appropriation, the document further shows that the Ministry of Aviation approved and awarded a total of 15 projects in Phase I of the airport remodelling and facility development in 2011, amounting to N12, 808,150,598.30
Also, the ministry approved and awarded 91 contracts for Phase II and additional consultancy projects in 2011, totalling N97, 668,167,822.11
And in order to complement the goals of the Phases I and II of the projects, the ministry secured the sum of N43,149,077,670.50 in the 2013 Appropriation to implement the Phase III and approved by the Bureau of Public Procurement (BPP) after submission by the MTB.
Accordingly, the funding was to be augmented from the approved BASA Funds amounting to N25 Billion of which the sum of N14.3 Billion was already available. The project funding was expected to further be augmented with funds allocated to airport development projects in the Internally Generated Revenue Appropriation from its agencies in 2013,and subsequently yearly for all projects.
Now, contrary to the impression that some people were not carried along in the formulation of industry wide policy, the Ministry of Aviation under Oduah held several stakeholder meetings on key industry issues.
These include an interactive stakeholders meeting held on April 16, 2012, at Abuja Sheraton Hotel, Nigerian and Foreign Registered Aircraft stakeholders meeting on April 22,2013 at Transcorp Hilton, Abuja, and Fresh Produce/Perishable Cargo Committee Meeting held on 22nd August 2013 at the Minister’s Conference Centre, FMA, Abuja amongst others.
Now, a group the Association of Aviation Stakeholders (AAS) has accused the Chairman, House of Representatives Committee on Aviation, Hon. Nkiruka Onyejeocha of playing bad politics with her position. According to the group, Onyejeocha cannot claim ignorance of the $500million Chinese-Exim Bank loan for the aviation sector and other infrastructural projects of the federal government.
The body’s national president, Abubakar Dan Maikasuwa, in a statement said: “Except she claims she was misquoted by the reputable media organisations that reported her comments, she was downright dishonourable and should be told so.”
