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The Federal Government would no longer enter into any fresh concession agreements at the country’s airports.

Henceforth,
it would rather undertake a comprehensive review of the existing ones
and plug the loopholes in revenue generation system in the aviation
sector.

The
minister of aviation, Fidelia Njeze, told reporters in Abuja yesterday
that all the existing concession agreements with the Federal Airport
Authority of Nigeria (FAAN) have issues that needed to be sorted out to
get them right.

According
to her, on assumption of office, studies of the agreements had revealed
that all of them needed to be reviewed, as their terms, which were
structured to assist the sector grow its revenue base, were “highly
skewed against government.”

“All
the existing concessions are not adding value to the aviation sector.
It is as if the aim of having them in place has been defeated. There
was need to take a critical look at the agreements and review them
thoroughly, so that it would be in line with the objectives of having
them, Mrs. Njeze said.

Getting things right

Mrs.
Njeze, who noted that she is the only minister in the history of the
ministry not to have entered into any concession agreement within one
year in office, said, “I want to review all the existing ones to get
things right. I have refused to enter into any new one, because all the
ones in existence have issues. But it is high time we started getting
things right. Somebody has got to do it someday, somehow, somewhere.”

Alluding
to the raging controversy between FAAN and one of the concessionaires
(Mevis) over alleged breach of terms of agreement, the minister said
that government is determined to get to the root of the issues
involved, because “an employee can never act like the employer.”

“It
has never been heard that one can engage a company to come and help
enhance revenue yield, yet one is not privy to what the company is
doing, because the company has turned to become a monster that cannot
even be managed,” she said.

According
to the minister, FAAN engaged the concessionaire to help boost revenue
generation, but the relationship reportedly turned sour after it was
alleged the concessionaire reneged on the terms requiring it to open
two dedicated accounts for all generated revenues.

It
was gathered that the agreement had benchmarked Mevis revenue
collection against the N700 million it generated in 2007, from where it
was entitled to 2 per cent as commission, while every revenue
enhancement effort was to fetch it additional 35 per cent commission.

Though
the concessionaire reportedly opened two dedicated accounts in two new
generation banks (Skyebank and Zenith) for its operations, it was
gathered that it had gone ahead to open a platform account, where it
lodged all revenues generated before transferring same to the dedicated
accounts, contrary to the concession agreement.

“FAAN
is meant to be paying Mevis, but Mevis is paying FAAN. From the
platform account, Mevis would transfer money to FAAN’s account after
deducting all its interests. Nobody knows what is happening in the
contentious Platform account,” the minister further said.

Fairness to all

“The
issue in question is not about money missing. All the money the company
has made has been paid into FAAN’s account. The issue is for government
to review the concession agreement to favour all parties. We want to
know the activities going on. The most important thing is that we want
to get things right,” the minister stated.

Though
the National Assembly committees on aviation described the concession
agreement with Mevis as fraudulent, and advised government against
keeping it, it was gathered that Mevis has resorted to the courts to
restrain government from going ahead with the planned review.

“Mevis
is only doing well on the international routes, because the revenues
are collected by International Air Transport Association (IATA) and
remitted to it. In the domestic route, Mevis is not doing well, because
the airline operators say its operation is fraudulent, and that they
are not going to pay money to it,” the minister said.

Reviewing
her activities in the past year, Mrs. Njeze said projects are ongoing
in five critical areas, including critical safety equipment, systems
upgrades, emergency response systems, travelers’ comfort, and
rehabilitation of infrastructures at the airports to meet international
standards.

“A
lot of training is ongoing. We are overhauling operations, without
compromising safety, by ensuring that all the airlines undergo
re-certification, to determine the state of the aircrafts that fly the
country’s airspace. This is one way to promote business and encourage
more investors to come into the country’s aviation industry,” she said.