NASS to seek constitutional solution to disbursement of 25% of FAAN’s IGR – The Sun Nigeria
By Chinelo Obogo
The National Assembly decided to seek a “workable” solution at the request of the Federal Airport Authority of Nigeria (FAAN) to be exempt from remitting 25% of its internally generated income (IGR) to the national treasury.
The chairmen of the House and Senate aviation committees, Nnolim Nnaji and Smart Adeyemi made this known at the 25th annual conference of the League of Airports and Air Correspondents (LAAC).
Senator Adeyemi, who spoke about FAAN’s mandatory 25% contribution to the treasury, said they were examining how the agency’s request to be exempt from remittance could be managed in a way that would not go against the constitution of 1999 as amended.
“We are looking at how we are going to handle appeals from agencies like FAAN to be allowed not to pay the required 25% of IGR into the treasury, as this would be in conflict with the constitution of the Federal Republic of Nigeria. We are looking at what can be done and that is one of the reasons we did not pass the bills. But when we get back from our vacation, we would take a final stand on this and look at how we can balance the 1999 constitution with what the bill seeks. But you know that in any situation where you have a law that conflicts with the constitution, the constitution will matter.
“I am a member of the Senate Constitutional Reform Committee and we will be meeting soon and some of these issues are what we would be looking at. We would look at how we can make the agencies more efficient by reducing or outright asking them to use some of the funds they generate, ”Adeyemi said.
Nnolim, who also spoke at the event, expressed sadness over the inability of airlines to access enough foreign exchange to purchase spare parts for aircraft. He also said it is unfortunate that the FG has not done much for the industry in regards to the bailout at the height of the COVID-19 pandemic.
The government has done little to bail out the airlines. The cost of a Boeing engine is close to $ 10 million and what the government has provided to all airlines is around N4 billion, so when you compare what our airlines got with d other countries, you will find that they haven’t done much for the industry. The aviation industry is a very expensive business and most people do not break even. What they manage to do is just keep the business going because everything in the industry is offshore and that’s a challenge.
“We have succeeded in securing zero rights for airlines on the purchase of spare parts. Another issue that they struggle with is the forex issue. Since they buy most of their business overseas, it is important that they have access to forex. Planes have to be in the sky all the time because the more you move, the more money you earn to be able to pay your bills. We would like the Central Bank of Nigeria to create a window for Forex as this will help reduce airline tickets.
“At this time, I’m not sure how the Forex ban on BDCs will affect the airlines, but I’ve heard that the black market rate has gone up. I’m still wondering if the banks can handle it, but from next week we will know how the airlines will be affected, ”Nnolim said.