Expert tasks NCAA on regular oversight, audit of earnings of airlines

Key players in the aviation sector have called on the Nigerian Civil Aviation Authority (NCAA) to carry out necessary actions before essential licenses like Air Operators Certificate and Air Operators Licence are issued to airlines.

The call may not be unconnected to the recent granting of AOC renewal  to NG airline despite its inability to commence operations until the earlier license issued it by the NCAA expired.

A member of Aviation Round Table (ART), Group Captain John Ojikutu, (retd), declared that the regulatory agency should not only stop at giving AOC or AOL, but should also conduct regular oversight and audits of earnings of the airlines when they commence operations.

According to Ojikutu: “There have not been serious annual auditing of any of the public and private operators by the NCAA and that explains the incessant requests for government intervention funds to private operators, grants to public operators from the available scarce monies meant for other critical social sectors like the health, education, agriculture and road network.”

Ojikutu alleged that the failure of the NCAA is responsible for financial incapacity  of the domestic airlines.

Citing the lack of proper audit on the earnings of the domestic airlines, the former Lagos airport military commandant declared: “None of these are effectively done on the public and private operators to know their financial health and we end up with unnecessary intervention funds, recurring debts among themselves and to external financial institutions.

“I have witnessed about four generations of private airlines operators in this country coming and quiting at short lifespans. Most of them made money, others did not because of bad business plans, poor corporate organisations and management, lack of knowledge in commercial aviation and corruption.”

Ojikutu, who recalled how during his membership of a presidential committee he was privy to how the intervention fund  of N19.5billion at 25 percent interests was collected for the government agencies from a in 2007 against the directive of the the Federal Executice Council (FEC) and another  N200billion at 5 percent from the CBN for private operators without the knowledge of the ministry.

“Today, none of the responsible authorities (ministries of aviation, finance and national planning, NASS,etc) has been able to verify the actual earnings of any of the public agencies, yet budgets are approved annually for the agencies,  but from where?,” he said.

At my last calculation, FAAN that is projecting N188bn earnings for 2022 should be generating minimum of N250bn from only 4 aeronautical charges alone  at only the 4 international airports excluding 14 other sources of its IGR at the airports. The NCAA too, not less than N50bn from the Ticket Sales Charges and others.”

While referring the public to go and “check the earnings of the Discos from its 10million consumers if it is collecting just N10,000 from each which include the manufacturing industries, banks and corporate organisations, low, medium and high density residential areas, etc; I pay minimum of N20,000 monthly and my office building at Maryland pays minimum N200,000 but the Discos has not reported any earning above $800bn in any year since 2013 whereas the amount from 10m at N10,000 each is not less than N2trn annually.

“Our government still gives subsidies of N600bn annually to the Discos but the Discos do not fulfill its necessary obligations to the Gencos and NERC like the NCAA is not concerned. Today too, government is subsidising the NNPC with N4trn from wherever and fuel is still not available; what is the sources of the money and who are those collecting the subsidies?

“If all these are happening within the government agencies; who then is watching over the private organisations like the airlines and oil marketers? The NASS getting involved in helping private operators to determine what charges to pay against their legislations is making the matter worse as has been the case since 2007. Things have been bad and are getting worse daily; who is going to save us from ourselves?”, he asked.