Business

Book keeping, airlines debt recovery imbroglio

Book keeping, airlines debt recovery imbroglio

By LAWANI MIKAIRU

The protracted debt reconciliation problem between the Federal Airports Authority of Nigeria, FAAN, and domestic airlines has brought  to the  fore once again the popular view, or what is almost becoming a fact, that government ministries and parastatals do not keep proper accounting records of financial transactions they engage in.

ArikOr how can one explain a situation where receipts or tellers , allegedly, cannot be produced by FAAN to back financial figures which keep changing at every debt reconciliation meeting with airlines? Is it not elementary accounting that books are opened for any customer or client you do constant business with, and every transaction  recorded immediately it takes place?

Last week, the nation’s aviation industry witnessed the disruption of Arik Air flight operations by aviation workers under the aegis of the National Union of Air Transport Employees (NUATE), the Air Transport Services Senior Staff Association of Nigeria (ATSSSAN) and the Nigerian Union of Pensioners (NUP), at the General Aviation Terminal (GAT) of the Murtala Muhammed Airport, Ikeja, Lagos over   N12.5 billion debts they claimed Arik Air is ownig FAAN.

The unions said Arik Air’s failure to pay the debts has incapacitated the Federal Airports Authority of Nigeria (FAAN) and made it unable to meet its obligations to employees and pensioners.

This is not the first time the unions will be disrupting the airline’s flight operations. Last year a similar incident took place and the airline’s flight operations were grounded for two days which led to untold hardship for air travelers as Arik Air has the largest fleet among domestic operators in Nigeria and airlifts more than fifty percent of the passenger traffic on domestic routes.

Commenting on last week’s incident, Arik Air Managing Director, Mr Chris Ndulue, said the disruption is unfortunate, adding: “When the revenue drive was ongoing and our operations were grounded, we tried to reach the management  of FAAN via phone calls and they did not respond and even text messages and up till now, as we are speaking, they have not responded. It is curious, why is it only Arik? Others are owing, even foreign airlines, but why Arik? The figures they bandy about, sometimes its N7b or N11b or like yesterday N12.5b.”

Also Arik Air Chairman, Sir Johnson Arumemi-Ikhide said the airline had paid FAAN N18.9 billion since inception. He frowned at the way the unions took the airlines by surprise while alleging that FAAN had been frustrating the reconciliation process initiated by both the court and past aviation ministers.

According to him “We have paid N18.9billion and we are saying that we need to reconcile. FAAN was the one that took us to court and are the ones that are not respecting court judgment. And anytime we want to reconcile these debts and get to the bottom of this matter once and for all, they (FAAN) become evasive.

“We are prepared to pay for services rendered to us but we are not going to be bullied into false payment. When they feel like, they resort to intimidations. They took us to court and said they will impound our aircraft and later rescinded but what happened was quite unfortunate.

It is not good for aviation and not good for Nigerian industries.” Arumemi-Ikhide  also recalled how efforts were made to resolve the dispute by the Senate Committee on Aviation, headed by Senator Hope Uzodima, former Aviation Minister, Mrs Stella Oduah and former Permanent Secretary, Ministry of Aviation, Mrs Binta Bello.