Nigeria loses $28m annually to flawed aviation handling rates – Experts

… NCAA asked to set up minimal safety threshold handling rates

Experts have estimated that the federal government and the ground handling companies in Nigeria’s aviation industry may be losing an estimated $28.35 million annually to inappropriate handling rates in the country as appropriate handling rates should earn them about $56.7 million.

Handling companies still charge between $300 to $1000 to handle a narrow body aircraft, rather than $1,400 to $1600 charged in other African countries. They also charge about $3,000 instead of $5,000 in sub-Saharan African countries for wide body aircraft.

Checks show that no fewer than 45 narrow body aircraft on regional and international routes, which include Boeing B737, Airbus A320, ER 135 and ATR aircraft are handled daily at the nation’s international airports by the ground handling companies.

In addition to this, over 20 wide body aircraft like B767, A330, B777 and B747 are also handled daily by the ground handling companies.

Investigations show that over 70 to 80 percent of accidents start from the ground. So, to prevent return of air crashes in the sector, experts have said the current rates should be reviewed, while the resources are used for training of manpower and acquisition of state-of-the-art handling equipment.

They say the current rates are not sustainable because of the drop in naira against major currencies and the Ground Support Equipment (GSE) and the facilities used in servicing them are GSE, which are also procured abroad. For domestic operations, some pay as low as N12,000 to N20,000 for aircraft turnaround.

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Ground handlers are suffering and need a lifeline to remain in business.

One of the Acts that set up the Nigerian Civil Aviation Authority (NCAA) is to ensure that safety and security are not compromised in the system. As a result, the regulatory agency has been called upon to set up a minimal safety threshold handling rates for the ground handling companies in the sector.

Sam Oduselu, the Pioneer Chief Executive Officer (CEO) of Accident Investigation Bureau (AIB) said he has had the privilege to see the current rates in Nigeria and in any other parts of the world and think it is backward and should be reviewed.

Oduselu said before now, Nigeria’s aviation industry had a funding challenge which has been worsened by the Covid-19 pandemic that is currently ravaging the entire world, adding that there is an urgent need to look into the funding of the sector.

He noted that apart from the government funding and subvention, one of such ways is increasing the handling rates which will bring a big relief to the industry.

He explained that ground handlers can jeopardise safety if staff are not adequately remunerated or not paid on time as this could result in staff not putting in their best on the job.

“It is easy for the staff to be compromised, apart from the safety aspect of it; there is also the criminality aspect of it. For instance, if you are paying your staff peanuts and the syndicates are able to get hold of them, they could put drugs and any other dangerous items in the aircraft because they are not happy with what they are doing.

“No one wants an aircraft to be blown up in the air. We need to focus on whatever they are charging so that their operations can be what we expect it to be,” Oduselu said.

Olatokunbo Fagbemi, the group managing director, Nigerian Aviation Handling Company (NAHCO) Plc said the rate is the benchmark below which handlers cannot offer these services safely.

Fagbemi said even in deregulated economies around the world, there are benchmarks that are given; some may not be announced while the others are announced. “What we are saying is that you can charge whatever you want, but you must not go below a framework that will harm the industry, harm the business and cause safety issues,” she said.

She noted that the NCAA is a regulator in charge of safety, security and economics of the industry.

“AGHAN has approached NCAA from the safety perspective. The regulation sets out boundary by which an operator can operate and so many things.

“So, when you say the industry is regulated, it doesn’t mean there are no boundaries, it is just that the boundaries are clear and you can come and operate, but when it is deregulated, the boundaries are formed, every part of it is clearly spelt out,” she said.

Basil Agboarumi, managing director of Skyway Aviation Handling Company, (SAHCO) explained that between year 2020 and now, the aviation sector has seen a major leap in terms of the forex that used to be N350 to now over N500 to a dollar and ground handlers are a heavy consumer of forex.

Agboarumi ground handlers have the duty to provide the best ground handling services that can compete with any other in the world and for them to do that, they need the equipment to do that because the world is changing in terms of equipment.

“Ground handling equipment, personnel and certification are changing. So, we have to change with the developments around the world. In fact, you have to pay the right salaries and remunerations to attract and retain your best hands.

“We are losing trained manpower to other aspects of the sector, we are losing trained manpower. Just as you train pilots for aircraft, we also have to train our staff, but unfortunately, we are losing them to the US, Europe and other parts of Africa. The services of our personnel are sought after. We are even losing staff to some of the start-up airlines that we trained,” he lamented.

He said SAHCO wants to be able to compete and be able to retain its staff and to be able to do that, they need financial resources.