Airport concession to leave $1bn loan for FAAN, says aviation workers

The Federal Airports Authority of Nigeria (FAAN) says if the federal government continues with its concession policy, it will place the union at a disadvantage of bearing a $1 billion repayment loan.

The union disclosed this in a press conference on Tuesday while addressing journalists in Lagos.

In June, the federal government announced plans to concession four airports for a period of 20-30 years.

The airports include Murtala Muhammed Airport (MMA), Lagos; the Nnamdi Azikiwe International Airport, Abuja; Mallam Aminu Kano Airport, Kano and Port Harcourt International Airport, Rivers state.

The union through its representatives which includes the National Union of Air Transport Employees (NUATE), Air Transport Services Senior Staff Association of Nigeria (ATSSSAN), Association of Nigeria Aviation Professionals (ANAP) and the Nigerian Union of Pensioners (NUP), FAAN branch said the economics of the concession did not add up at all and that the policy would be unfavourable to them.

Ocheme Aba, general-secretary for NUATE, who spoke on behalf of the union expressed his concerns.

“While the sharing ratio is proposed to be 60:40 in favour of the concessionaire, the disadvantaged FAAN is made to bear the repayment of the $1bn loan utilised to build some terminals, continue to pay emoluments of its staff pensioners, return 25 per cent of its Internally Generated Revenue to the government under the Fiscal Responsibility Act, and maintain the remaining 18 airports in Nigeria,” he said.

According to the union, there is no possibility of FAAN meeting even a quarter of the obligations.

Aba noted that the basis of granting the concessionaire the lion share of 60 per cent of the profit remained dense and the model of concession by the government could be summarised as Take, Operate and Transfer and translated to reaping without sowing.

He established that FAAN’s unresolved litigation on the concession was within the public domain.

“No case whatsoever has been established for the concession of any airport terminal in Nigeria in the first place,” he added.

“The terminals earmarked for concession are brand new 21st century terminals which have absolutely no need for any significant investment other than maintenance in the next 25 years.

“A cursory look through the Outline Business Case (OBC) shows that the promoters are unsure of the concept to adopt between BOT and Rehabilitate, Operate and Transfer. This apparent confusion to us stems from an established fact in these particular terminals that there is neither a thing to build or rehabilitate,” he added.

The workers’ spokesman said if there should arise a need for expansion in the terminals, which according to the unions was not envisaged in another 25 years, then the Green Fields concession option would be applicable.

He added that all airport workers, aviation workers should stand for their rights in lending their voice to say no to the concession model proposed by the Federal Government.

The federal government had assured workers of FAAN that it will not terminate their employment amid plans to concession four major airports in the country.