The Managing Director of the Federal Airports Authority of Nigeria, Rabiu Yadudu, says FAAN’s revenue has shrunk by over 95 percent due to the lockdown imposed to halt the spread of coronavirus.
Yadudu, at a media parley in Abuja on Thursday, was answering a question on why the agency increased the Passenger Service Charge from N1,000 to N2,000.
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He said the increase would take effect on September 1, 2020.
“The increase is a matter of necessity.
“Our revenue is down by over 95 percent. In that case, we’ll do whatever we can legitimately to ensure we carry out our duties.
“We need to survive.
‘There’s no better time than now for FAAN to do this,” Yadudu stated.
He added that the increase in PSC, being the first since 2011, became necessary considering the realities of cost related inflation rate which the Central Bank of Nigeria has put at 12.82%.
He said FAAN, until 2019, was collecting the naira equivalent of PSC at an official rate of N305.50 to N344.38 to a dollar when airlines were collecting at subsisting market rates of about N362 to a dollar.
He said the Federal Government would increase its direct deduction from FAAN to 40% from 2021 and the development would leave the Authority with a shortfall of over N16bn on overhead cost.
“The authority is however engaging the Federal Government to exempt her from this deduction,” he said.
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