The Federal Airports Authority of Nigeria (FAAN) has announced a 100% hike in Passenger Service Charge (PSC).
Instead of the usual N1,000, passenger would now have to pay N2,000 on the domestic route and $50-$100 on intercontinental routes and $80 for ECOWAS, effective September 1.
Speaking at a media briefing in Abuja, on Thursday, Managing Director, Capt Rabiu Yadudu, said the increment is due to the slump in revenue by 95% as part of the disruptions occasioned by the coronavirus.
“Our revenue is down by over 95%. So, you must do what you can legitimately do to deliver the services and of same quality,” he said.
“We are cutting costs where necessary to ensure excellent service delivery and not compromise on safety and security. We need to continue sustaining our operations.
“FAAN has not increased PSC since 2011, despite all the huge capital investments at our airports. The current PSC charge of N1,000 is no longer realistic as it does not correlate with realities of cost related inflation rate which the CBN has put at 12.82%.
“Besides, FAAN, until late 2019, was collecting the naira equivalent of PSC at an official rate of N305.50-N344.38 to a dollar when airlines were collecting at subsisting market rate of about N362 to a dollar.”
On international flights resumption, the FAAN boss said: “We are ready for it. All the protocols are in place. The number of airlines will be determined by the NCAA and other relevant authorities.
“Not all the airlines will resume same time. Some are even bankrupt. It’ll be a gradual process but in term of providing the needed airport services, we are ready,” he stated.
On possible ways FAAN was working to stay afloat, Yadudu said “FAAN is expecting an intervention fund from the Federal Government to buoy its operations but we don’t know the amount. We need it.”
He, however, revealed that the Federal Government plans to increase its direct deductions from FAAN to 40% from 2021, which will translate into a revenue shortfall of N16 billion on overhead cost.
“The authority is however engaging the Federal Government to exempt her from this deduction.
“It should be noted that ICAO’s recommendation in Doc. 9562 stipulates that revenue generated by airports be transparently re-invested wholly in operating and developing airport facilities, he added.
The FAAN MD urged all travellers, including VIPs to obey all airport COVID-19 protocols in the interest of safety and security.
Globally, countries are making economic conditions easier for citizens and businesses, especially in the badly hit travels and tourism sector. Analysts believe that this sharp and sudden increase is a move in an opposite and inhibitive direction more likely to halt than help growth.
