Senate has said that the N5billion proposed bailout funds for operators in the aviation industry by the federal government is meagre to mitigate the effects of COVID-19 pandemic and inadequate in addressing the daunting challenges facing the sector.
The upper legislative chamber therefore urged the government to increase the funds in order to harness the full revenue capacity of the sector.
Chairman, Senate Committee on Aviation, Senator Smart Adeyemi (APC Kogi West) made the appeal while reacting to a disclosure by the Minister of Aviation, Senator Hadi Sirika that the sum of N4billion has been proposed for airline operators and N1billion for other businesses operators within Nigerian airports as bailout funds.
The minister, in his speech at the opening ceremony of a three-day public hearing on six aviation executive bills which include; a Bill for an Act to Repeal the Civil Aviation Act 2006 and a Bill for an Act to Repeal the Nigerian College of Aviation Technology Act Cap N96 LFN, 2010, held at the National Assembly, said the proposed bailout will be considered by the government because of its desire to fully diversify the economy base of the nation.
“The bailout is to keep operators in business after major activities around the aviation industry went down as a result of recession suffered by virtually all the sectors of the economy during the outbreak of the coronavirus pandemic,” Sirika stressed.
Reacting, Senator Adeyemi, though commended the government’s efforts, he said the amount is too small to cater for the losses suffered by operators and stakeholders in the industry.
He argued that if not adequately provided for, operators may be compelled to cut cost and engage in other unwholesome activities that will put both consumers of services and government at risk.
Adeyemi had earlier in his welcome address at the public hearing session, on behalf of the Senate President, Ahmad Lawan, lamented that the industry was one of the worst hit by the COVID-19 pandemic.
The chairman noted that the aviation industry is the fastest-growing sector of the Nigerian economy despite the setback caused by the pandemic.
He said: “Let me take this unique opportunity to call on the federal government to explore the possibility of providing bail out funds for the airline operators.
“The outbreak of the COVID-19 virus is a global and on-going pandemic and countries all over the world are providing bail out funds for airline operators.
“Certainly, the aviation industry was the most affected by this virus attack and therefore need all the support possible to resuscitate the Industry.
“In the absence of this, so many airlines will struggle to stay in business or worst still, be forced to withdraw their services. Bail out funds will mitigate the Devastating and also discourage operators from cutting corners as the consequences can only be better imagined.”
Speaking on the bills, Adeyemi said the repeal and re-enactment of the six Executive Bills are aimed at enhancing the operational framework and the removal of the seeming ambiguities that inhibit the international best practices within the air transport sector.
He said the aviation industry is a dynamic world in itself; hence, continuous changes and upgrades must be made to meet safety needs and promote economic growth.
“Globally, air transport is the strongbox of social and economic activities. To be worthy competitors, we must collectively address the challenges that the industry is currently faced with. Issues such as safety, poor regulatory functions, viability, operational costs, affordability amongst others must be addressed urgently,” the chairman stressed.
Outlining the benefits of the new bills, Adeyemi said “economic growth, job creation, better and timely services, faster and safer means of transportation of passengers, goods and services are but a few of the benefits we all stand to gain if these obsolete Acts are carefully repealed and overhauled.”
“I sincerely hope that at the end of this exercise, the new Bills when passed, will be widely acceptable, bring about operational improvements, increase efficiency, flexibility and harmonization of procedures within the Industry. In so doing, we would have set a standard for Acts that will stand the test of time,” he added.
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