Controversy rages over N4bn airline bailout

There is a raging controversy over the approved disbursement of the N4 billion bailout for airline operators to reduce the effects of the COVID-19 pandemic.

There have been views on what the N4bn can do to the operations of airlines. Daily Trust also learnt that there are moves to exclude some government-backed airlines.

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How adequate?

Nigeria has 33 airlines with Air Operator’s Certificates (AOC). Nine are scheduled airlines while 24 are non-scheduled carriers.

If the N4bn would be shared among the airlines, it means each carrier would be entitled to over N121 million, analysis shows.

However, there is a growing demand that priority should be given to bigger airlines whose operations were largely impacted by the COVID-19 pandemic.

An airline operator said, “I can tell you airlines may soon collapse without any form of support from the government. Certainly, N4bn is too little to do anything.

“We submitted an application in June. Government has been promising us yet we don’t know when this help would come. Again, we are concerned about what the N4bn would do for us. Is it to acquire aircraft which I’m sure is not enough to buy one aircraft? Or is it for salary payment?”

Another airline operator said, “As I am talking to you, there is no update on it. We don’t know what is happening.”

Aviation analyst, Olayinka Abioye, said, “Doling out a paltry N4bn to airlines smacks of mischief laced with callousness. What can this amount do in the operational lives of these airlines? What are the templates for sharing?”

The Head of Research and Corporate Travel at Zenith Travels, Mr. Olumide Ohunayo, believes that non-scheduled carriers should not benefit from the palliatives.

“Government cannot just throw this palliative to everybody. If an airline has collected before and you are meeting the repayment obligation, you can be considered. Palliatives should be given not only to the airlines but the entire value chain and this must be done not by the government agencies but reputable international financial institutions.”

Group Capt. John Ojikutu, a former Commandant of the Murtala Muhammed Airport, said the bailout should be given to airlines that are not indebted to government agencies, and that it should be to offset part of staff salaries.

“This is the time I will agree that the staff are needed for the customers hence my reason that whatever is the bailout or palliatives, the staff should be the consideration because of the effect of COVID-19 on them; any other need for their operations should have been factored in their business plans not on government.

“Intervention funds given to airlines did not work for the government in the past when there was nothing like COVID.  AMCON is still on Arik, Aero, Air Nigeria, etc. It won’t work at all now in COVID,” he noted.