Ground Handlers call for waive of 5% annual concession fees, customs duty

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……urges NCAA to implement ICAO regulation on charges

Chairman AGHAN, Mr. Olaniyi Adigun

To break even in their operations and remain in the business, the Association of Ground Handlers of Nigeria (AGHAN) has called on  the Federal Government to consider the waive of the 5% annual concession fee for ground handling companies in the Nigerian aviation industry.

This is just as the body called on the Nigerian Civil Aviation Authority, NCAA, to implement ICAO regulation on charges.

While commending the Federal Government for the recent palliative given its members, the Association also solicit custom duty waivers for importation of ground handling equipment.

Chairman, AGHAN, Mr. Olaniyi Adigun, in an interview with reporters in Lagos said, the removal of the 5% concession fee, especially for 2020 financial year was necessary for its members to stay afloat in the business.

He stated that rather than stifle the ground handlers out of business, the handlers required the support of every operator, including the airlines and government agencies.

“There is this 5 per cent concession fee, which we usually pay to FAAN; this is based on our turnaround. Though, there have been some issues on this because FAAN is asking for turnover, which includes money collected and the ones still unremitted. So, we are saying that 5 per cent should be based on profit, not on turnover”.

He asked the government to modify the mode of collection of the annual concession fee.
According to him, the concession fee is calculated based on turnaround, rather than on profit.

Adigun also decried the handling charges by ground handlers and called for an upward review of the charges, describing it as “a peanut.”

According to him, on the domestic scene, the handlers charge only a N30,000 turnaround fee, while on the international scene, its charges vary from $200 to $1000, depending on the aircraft brand and capacity.

The AGHAN chairmen charged the  Nigerian Civil Aviation Authority (NCAA) to intervene in the situation by implementing the International Civil Aviation Organisation (ICAO) regulation on handling charges, warning that safety may be at stake if the charges were not reviewed.

He described the present charges as capital flight against the country and appealed to the government to intervene in the interest of the nation.

“On the international and regional, what we are saying is that there should be a fair play in the system.  Some of our airlines are operating regional and international operations. How much are they paying on those routes? But, because of the unhealthy competition then, the airlines seized the advantage. Unfortunately, the major ground handling companies came out from airlines. For instance, SAHCO was an offshoot of the defunct national carrier, Nigeria Airways and NAHCO too was from British Airways, Lufthansa and others.

“What we are saying is that for international, there is a Federal Government approved rate as was done in the 1980s, which varies from $2,000 and N3,000, depending on the aircraft brand. What we want is the implementation of this rate, but the government is saying it has to be determined by the law of demand and supply, which is not so anywhere in the world.

“We are asking NCAA to regulate this aspect of the industry, just as the Central Bank of Nigeria (CBN) is doing in the financial sector and Nigerian Communications Commission (NCC) in the telecommunication industry. This is to ensure that no one is taking undue advantage of the weak structure we have on ground.”

“Our prayer is that this 5% concession fee should be waived for the 2020 financial year. 2020 was tough and there was no work available and the little we had last year was to sustain our staff. Though, the palliative is good, but how far can that go in the life of the Skyway Aviation Handling Company (SAHCO) Plc or the Nigerian Aviation Handling Company (NAHCO) Plc for instance? Whatever we got individually, is not even enough as a monthly wage for the two companies. So, we are asking for the waiver for that 2020.”

The Ground Handling Companies remit to the coffers of the Federal Airports Authority of Nigeria (FAAN) 5% concession fee annually.