Debts Issues Linger Between AON And NCAA

Debts Issues Linger Between AON And NCAA
  • PublishedApril 13, 2017

Airline Operators of Nigeria (AON), the umbrella body of Nigerian domestic air carriers, has denied the Nigerian Civil Aviation Authority’s (NCAA) claim that the AON owes the NCAA N15 billion in debt due to the former’s failure to remit revenue collected from the 5 percent Ticket/Cargo Sales Charge (TSC).

AON described the massive debt as ‘a phantom’ and challenged the NCAA to a public debate on the matter.

Capt. Nogie Meggison, president of AON, in a statement to released journalists in Lagos, insisted that the NCAA was not transparent enough in its bid to automate the remittance of the 5 percent TSC by the airlines and questioned why it wanted to go through an unknown third party for the remittance of the revenue.

AON said it was ready to engage external auditing firms like or like KPMG, PricewaterhouseCoopers, or Deloitte and Touché, to audit the NCAA’s collection of the 5 percent TSC and the N15b debt claim.

Mr. Meggision recalled that a particular organization in the industry once went through a third party for the collection of aeronautic and non-aeronautic revenues after the abrupt cancellation of a contract of

Maevis Nigeria Ltd, an organization that was in charge of the revenue for the agency.

He also pointed to a similar case in which the cancellation and engagement of another organization resulted in missing N25 billion remittance and an unresolved case in the law court till date.

“The presidency had to wade into the matter and hand over the case to the Economic and Financial Crimes Commission (EFCC). There is as another N5 billion court judgment awarded against the agency for the unlawful cancellation of the contract to the favor of Maevis Ltd,” he said.

AON maintained that it never requested for the cancellation or suspension of the 5 percent TSC, but only asked for the suspension of the automation till there was enough clarity on the side of NCAA.

Mr. Meggison also declared that most of the alleged debts were owed by airlines taken over by the Asset Management Corporation of Nigeria (AMCON) and former airlines which have ceased operations due to the harsh economic environment in Nigeria, unfriendly policies and the continued burden of multiple charges imposed on them.

On the monthly remittance raised by the NCAA, Mr. Meggison insisted that the airlines had no monthly remittance of the TSC with the NCAA and wondered how it came about the idea.

According to him, airlines were supposed to pay a percentage of the fare and passengers they airlift at a particular point in time, questioning why an airline like Arik Air, with 27 airplanes, had a fixed monthly remittance rate of N61,477,779.69 while Air Peace, with an average of five airplanes, could pay N109,862,633.84 monthly.

“At what rate were these figures calculated to get a fixed amount?” he asked.

Mr. Meggison also posited that a couple of the airlines that made up the “phantom” numbers were not Nigerian-registered airlines, specifically naming Cronos and Africa World Airlines (AWA).

He recalled that during the introduction of the 5 percent TSC in 2001, many of the charges domestic carriers pay today were not in existence.

He said the 5 percent TSC was introduced to reduce the NCAA’s dependence on funds from the government saying that many other charges not existing before had been introduced while the domestic airlines had been paying the 5 percent TSC as well as the other charges.

Mr. Meggison further lamented that domestic airlines pay over 37 additional charges under the guise of statutory levies and taxes. Some of the charges according to him are 5 percent Ticket Sales

Charge, 5 percent Cargo Sales Charge, 5 percent Value Added Tax (VAT), Passenger Service Charge, Charter Sales Charge, Aircraft Inspection Fees, Simulator Inspection Fees, Landing Charges, Parking Charges and Terminal Navigational Charge, among others.


Source: Sahara Reporters


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