Mixed reactions have continued to trail the missing of three ma­jor aviation agencies from the 2024 Appropriation Bill to the National Assembly by the Fed­eral Government.

For the umpteenth time last week, the Nigerian Airspace Management Agency (NAMA), the Federal Airports Authori­ty of Nigeria (FAAN) and the Nigeria Civil Aviation Agency (NCAA) were omitted from the appropriation bill by President Bola Tinubu when he presented it to the National Assembly de­spite the kick in some quarters in the past.

Industry experts had argued in the past that the resources earned by the agencies were only cost recoveries and not profits like other sectors of the economy.

Also, the International Civil Aviation Authority (ICAO) rec­ommends that revenues earned in the industry by government agencies should be ploughed back into the system for upgrade of facilities and equipment, but the government had consistently ignored this.

Rather, a few years ago, the government went ahead to in­clude some of the agencies in the Treasury Single Account (TSA) with the compulsory contribu­tions of 15 percent of their reve­nues into the federation account.

On October 15, 2022, the Fed­eral Government increased the contributions into the TSA to 40 percent, thereby further squeezing the agencies and their resources and preventing them from carrying out capital projects independently.

Mr. Chuwkudi Amokwu, avia­tion expert, said that the removal of the two out of the three agen­cies from annual budgets was not good for the system.

According to Amokwu, agen­cies like NAMA and NCAA could be included in the annual budgets, saying that whatever is generated by the two agencies are not profits, but cost recoveries.

He, however, said that FAAN could be exempted, describing it as a revenue generating agency in the industry.

For instance, Amokwu ex­plained that NAMA embarks on capital projects and procurement of equipment like communica­tion gadgets for its Air Traffic Controllers (ATCs), facilities for its engineers, training and retraining for staff, irrespective of departments, while it also ensures regular power supply to all its facilities at airports and stations across the country.

For NCAA, Amokwu ex­plained that the apex regulatory agency was not a revenue gener­ating agency, but earned recovery fee through the 5 percent from the Ticket Sales Charge (TSC) and Cargo Sales Charge (CSC), which it shares with other four agencies in the sector.

He emphasised that NCAA as the apex regulatory agency in the sector, ought to be above other agencies and companies, especial­ly the airlines in a bid to effective­ly regulate their activities.

Amokwu argued that its tech­nical personnel should be trained and retrained regularly in order to be on top of their games.

The aviation expert also ar­gued that the aviation agencies should be removed from the 40 percent TSA contribution to the federation account.

He said: “I want to say that the removal of NAMA and NCAA from the annual budgets is not well-thought-out. I think it is due to ignorance. You can ex­cuse FAAN from this because the agency generates revenue, but for others, theirs is not revenue, but recovery costs.

“We all know the cost of diesel today in the market when com­pared to early this year or even a year ago. The agency needs to power its equipment for 24 hours and we all know the epileptic pow­er supply the country is battling with at the moment. NAMA still buys navigation equipment. The agency is not a cost recovery agen­cy and doesn’t earn revenue. The government doesn’t also factor into it the replacement cost and in over a decade, I am not sure if NAMA had increased its charges to the clients.

“I think Mr. Festus Keyamo, the Minister of Aviation and Aerospace Development, should lobby the presidency on two things: inclusion of NAMA and NCAA in the annual budgets and removal of aviation agencies from 40 percent contributions to the TSA. This will be in compli­ance with the recommendations of ICAO.”

But Capt. Samuel Caulcrick, the former Rector, Nigerian College of Aviation Technology (NCAT), Zaria, said the removal of the agencies from appropria­tion bills was justifiable.

Caulcrick explained that the Civil Aviation Act, as amended, gives autonomy to the NCAA, while the 5 percent TSC/CSC funds the agency.

He also pointed out that NAMA gets 22 percent from the 5% TSC, while FAAN gener­ates revenues from the airport charges; domestic and interna­tional airports.

Calucrick emphasised that apart from the NCAA, the gov­ernment built up the infrastruc­ture of both FAAN and NAMA and was still responsible for their upgrade.

He explained further that the TSA 40 percent deduction from the agencies’ accounts is after op­erational expenses, maintaining that the government position is that the two agencies (NAMA and FAAN) don’t fund their infra­structure, but only responsible for payments of salaries and wages, operational costs and others only.

He added: “⁠What is lacking, like most public institutions in Nigeria, is not separating equity from efficiency. Equity is a social responsibility like the federal character policy, while efficiency is cutting operational costs while delivering world-class services.”

Olumide Ohunayo, the Gen­eral Secretary, Aviation Safety Round Table Initiative (ASRTI), canvassed for the stoppage of the 40 percent TSA deduction from the agencies’ earnings.

He posited that it was neces­sary for the agencies to keep their earnings in line with the ICAO document in a bid to reinvest them into the aviation sector.

He, however, said that NAMA should be exempted from the ap­propriation bill, arguing that the industry was far from acquiring and installing critical equipment for the sector.

He explained that the govern­ment still needed to continue to support the agency to get to that navigation efficiency that the industry required, maintaining that it could be a win-win situa­tion for all.

He added: “FAAN cannot con­tinue to be an appendage of gov­ernment whereby they appoint the day-to-day management and impose staff on them. In doing that, they might also need to get reputable international airport managers to come and reorgan­ise FAAN to ensure that revenues coming in are properly chan­nelled and used for the appro­priate reasons and also deem the excessive leakages and reduce the staff strength and other things that are inhibiting FAAN from operating to maximum capacity.

“FAAN can survive without ap­propriation from the government because by the virtue of revenue strings coming in, it is easy for them to get facilities from organ­isations and these finance compa­nies. Unfortunately, the process of accounting has made that impos­sible because it is not enough for people to say ‘yes, we want to invest and partner with you.’

“It is necessary for the gov­ernment to stop interference in FAAN and also allow it to get in­dependence and get a reputable management organisation to come and turnaround the system for it to be that revenue generat­ing agency that will work in the mode of Airport Company of South Africa that will yield fund for the government and also in­vest in other neighbouring coun­tries airports as an investor.”

Besides, Grp. Capt. John Oji­kutu (rtd), the Chief executive Officer (CEO), Centurion Secu­rities Limited, insisted that the Federal Government and the National Assembly were justi­fied for leaving out some of the aviation agencies from the annual appropriation bills once the gov­ernment compels them to send 40 percent of their revenues to the TSA account.

Ojikutu, however, declared that the government and the Na­tional Assembly ought to carry out investigation into the reve­nues of the affected three agen­cies to know if their revenues were sufficient enough for their annual activities before removing them from the appropriation bills.

He added: “However, not giv­ing these agencies the annual appropriations will not have a negative impact, but we must know what the actual revenues of the other three are.” (Daily Independent)