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Adeyemi advocates N50bn bailout fund for airline operators

By NAN
23 November 2020   |   9:01 pm
Sen. Smart Adeyemi (APC Kogi), has called on the Federal Government to provide a bailout fund of N50 billion for airlines operators in the country.

Sen. Smart Adeyemi (APC Kogi), has called on the Federal Government to provide a bailout fund of N50 billion for airlines operators in the country.

Adeyemi, who is Chairman, Senate Committee on Aviation made the call at a news conference in Abuja on Monday.

Adeyemi, who raised an alarm that it was no longer safe to fly Nigerian Airlines, noted that the airline operators in Nigeria were managing and cutting corners in their operations because of challenges inherent in their operations.

“We particularly held interactions with Airline operators and a few important factors came to fore.

“It will indeed require executive orders which must be adhered to.”

He said although Federal Government had provided a bailout of N4 billion for the operators he, however, said there was need for a review of the bailout to keep the airliners in business and ensure safety of passengers.

“With further and more critical intervention with airline operators in Nigeria, we gathered that approximately N50 billion will be required to meet the requirements of airline operators.

“This increase in bail fund is imperative if we are to keep our economy running, guaranty job security and mitigate retrenchment.

“A critical look at the aviation industry in Africa, Senagal, for instance, which is no competition for the Nigerian Aviation industry in terms of number of airline operators, released a sum of 74 million dollars as bail out funds for its Airline operators.

“Rwanda also released 150 million dollars for its airline operators.

“Taking the scope out of Africa, America for instance released the sum of 58 billion dollars as bailout funds for its airline operators.

“If comparative analysis is anything to go by, it is clear that the N4 billion naira announced by the Federal Government as bailout funds for airline operators will not be sufficient to sustain three of the needs of the 15 scheduled flight operators, save the non scheduled operators,” Adeyemi said.

He listed some challenges currently faced by the airline operators to include the non compliance of Nigerian Customs with the executive order to waive any form of taxation on importation of spare parts and commercial aircrafts.

Others are multiple forms of persisting taxation on the airliners and non compliance of the executive order on the removal of Value added tax (V.A.T) from air transport.

He also listed the inability of the airline operators to have access to single digit lending as obtainable in other parts of the world.

Adeyemi said the inability of the airline operators to access foreign exchange as at when due to enable them to pay the value added tax for their aircrafts was a challenge.

He said enquiry of the committee indicated that airline operators were already discouraged and have resorted to cutting corners in carrying out maintenance requirements on their aircraft.

This, Adeyemi said was as a result of their poor financial situation.

“If this is not immediately checked, the effect is best not imagined.

“Let us note that no amount of money is worth the life of even one Nigerian and it is on this note that we call the immediate and urgent attention of the Federal Government on the need for the increase on bailout funds for air line operators.

“As Legislatures, we strongly advice the Nigerian Government to run a tax free, VAT free process for all spare parts and commercial aircraft being imported to Nigeria.