THE Federal government of Nigeria is embarking on concession of four major airports in the country in a bid to draw massive infrastructure into the aviation sector and allow efficiency in maintenance and management of these airports for greater output of services and revenue.
Inaugurating a Project Steering Committee, and a Project Delivery Committee on airports concession in Abuja recently, the Minister of State for Aviation, Sen. Hadi Sirika explained that the Project Steering Committee is to provide the general direction, and steer the course of Public Private Partnership project concessions in the Aviation Sector.
Sirika first made open the planned concession in the aviation industry at the aviation stakeholders’ forum months ago, when he announced that Murtala Muhammed Airport Lagos, Nnamdi Azikiwe International Airport Abuja, Aminu Kano Airport Kano and Port Harcourt International Airport will be handed over to the private sector operators for management.
The news of the planned concession was received with mix feelings; many stakeholders in the industry had argued that handing over these huge government assets that has not done well under the management of public service will certainly better the lot of the industry in the hands of the private sector. Others are of the opinion that the past concessions had not yielded the desired results and advised that caution should be applied if the planned concession must pull through.
Workers of the Federal Airports Authority of Nigeria (FAAN) and other affiliated unions staged a protest against the planned concession which spread across states of the federation calling on government to rather develop airports facilities in order to boost high capacity utilization.
The House Committee on Aviation had argued in the same direction. According to the House Committee Chairman, Hon Nkeiruka Onyejiocha, “I am one person who doesn’t believe that we should privatize the four major airports that we have because I know it is these airports that are funding the other 18 international airports”
Hon. Onyejiocha disclosed this in Lagos while she led an 18-member delegation to ascertain the true state of the industry. Other members of the delegation equally demonstrated strong opposition to the proposed concession of some of the country’s airports.
On the contrary, the Senate Committee Chairman on Privatization, Ben Murray-Bruce at a stakeholder’s conference organized by CheckinNigeria, an aviation and travel consultancy firm in Abuja declared his support for the concession programme.
Senator Bruce stated that his committee was prepared to facilitate laws to fast-track the success of the concession programme, adding that countries with the best airports were those who had long privatized their airport terminals, while those with dilapidated airports, like Nigeria, have refused to allow private investors manage their airports for them.
Tolling in the same direction, the Senate Committee on Aviation has thrown their weight behind the planned concession. Revealing this, the Chairman of the Committee, Sen. Adamu Aliero stated that the country’s Aviation sector is in need of expertise that will unlock the economic potentials of the industry.
Although the argument for or against the privatization of Nigeria’s four major airport is presented with authentic views that pin point to the factors that have halted the development of the aviation industry for a long time, and also solutions that will move the industry forward, yet the future of the proposed concession is not clear as there are many unanswered questions from the previous failed concessions by the ministry.
Even though these arguments are strong, there are obvious pending dangers to the planned concession that have not been addressed. In 2003, the Obasanjo administration signed a Build, Operate and Transfer (BOT) contract with Bi-Courtney Aviation Service for the second terminal at Murtala Mohammed Airport (MM2). Sadly, the contract has been engulfed in controversy of litigation.
According to Premium Times report 2016, the Chairman of Bi- Courtney Group Nigeria Limited, Wale Babalakin, had accused the Federal Aviation Authority (FAAN) of violating to rule of law principles by failing to heed to the judgment of the Federal High court Lagos.
Bablakin stated this at the recently organized four-day public hearing by the House Committee on Aviation that, a Federal High Court on March 3, 2009, in judgment, ordered FAAN to hand over General Aviation Terminal (GAT) of the Murtala Mohammed International Airport, Ikeja, to Courtney Limited. He addedthat, the judgment also ordered FAAN to pay damages of N134 billion to Bi-Courtney in 2012, which he said, had not been paid.
In a related development, the Federal Government through FAAN also terminated the contract they (government) had entered into with Maevis Limited in 2012. FAAN, on behalf of the government signed an agreement with Maevis Limited in October 2007 for acquisition, installation, operation and management of World class integrated Airport Operations Management system, Airport Operation Database, Common Use Terminal Equipment, Computer Based Departure Control System Platform, Common Use Self Service Kiosk, a fully automated Airport Pricing and Billing System at designated Airports.
The termination of the contract by FAAN did not go well with Maevis Limited and the company took the matter to court. In May 2010, Justice Binta Murtala Nyako of the Federal High Court in Lagos ruled that FAAN had no right to terminate the company’s Airport Operations Management Service (AOMS) contract.
None of the above court rulings has been complied with by FAAN or the Ministry which put the regulatory body (FAAN) and the ministry in a very delicate position that is very prone to more litigation if Federal Government enters into another concession with any other company without resolving the pending legal tussle with Bi-Courtney and Maevis Limited.
In the light of the above, a former Director-General of the Nigerian Civil Aviation Authority (NCAA), Dr. Harold Demuren, had called on the Federal Government to first of all review all pending litigations from the previous failed concession attempts before embarking on new concession plans.
Speaking recently at an Aviation Forum in Abuja, the former DG stated that, “I support concession of our airports wholeheartedly; but government needs to review all existing issues and litigations which arose from previous concessions before getting into another concession agreement with new investors.”
“I am a bit confused about what government wants to privatize, there are already existing issues and litigations in court with some of the airports, which should first be resolved if we want to get the best out of this” Demuren added.
It is out of this concern that, the House Committee on Aviation is engaging stakeholders in public hearings on the planned concession of the country’s major airports by the Ministry of Aviation as a way of bringing all unresolved issues on the table and looking for solutions before entering into fresh agreement with new investors in order to avoid another long rope of litigation circle that will defeat the gains of the planned concession.