FAAN, Bi-Courtney differ on approach to aviation revenue

By Dickson Omobola Federal Airports Authority of Nigeria, FAAN, and Bi-Courtney Aviation Services Limited, operators of the Murtala Muhammed Airport Terminal Two, MMA2, have recommended different approaches to growing the country’s aviation revenue, with the airport management agency advocating a comprehensive review of taxes, levies and charges.Although FAAN said there was a need for transparency and a review of the revenue structure across the aviation industry, the terminal operator pushed for a growth-driven model that prioritises lower charges and increased passenger traffic.The different positions emerged at the 30th Annual Conference of the League of Airport and Aviation Correspondents, LAAC, themed ‘Towards Sustainable Aviation Industry: Balancing Government Revenue Demands with Sector Growth,’ held in Lagos.Speaking during a panel session at the conference, Managing Director of FAAN, Olubunmi Kuku, represented by the agency’s Director of Finance and Accounts, Ayodele Olatiregun, said despite improvements in aviation revenue and domestic passenger traffic since the COVID-19 pandemic, international traffic had remained the major driver of revenue in the sector.Kuku, who said the contribution of domestic passenger traffic to the overall revenue base remained relatively low despite a slight improvement in passenger numbers over the last five years, called for a comprehensive review of all taxes, levies and charges in the air transport sector. However, she said all stakeholders must be ready to make their figures available to facilitate the process.She said: “One thing I will also say from this other side of the divide is, in the last five years, post-COVID pandemic, there has been improvement in the revenue generation in aviation as a whole. But, unfortunately, data shows that most of this is actually driven by international traffic, rather than local traffic.

What I will say, in essence, is, I understand the fact that there are several charges from the perspective of who pays them. But from the airport perspective, everything that we have done is in line with international regulations.“Of course, we know that aviation is highly regulated. Although FAAN said there was a need for transparency and a review of the revenue structure across the aviation industry, the terminal operator pushed for a growth-driven model that prioritises lower charges and increased passenger traffic.

The different positions emerged at the 30th Annual Conference of the League of Airport and Aviation Correspondents, LAAC, themed ‘Towards Sustainable Aviation Industry: Balancing Government Revenue Demands with Sector Growth,’ held in Lagos. Speaking during a panel session at the conference, Managing Director of FAAN, Olubunmi Kuku, represented by the agency’s Director of Finance and Accounts, Ayodele Olatiregun, said despite improvements in aviation revenue and domestic passenger traffic since the COVID-19 pandemic, international traffic had remained the major driver of revenue in the sector. Kuku, who said the contribution of domestic passenger traffic to the overall revenue base remained relatively low despite a slight improvement in passenger numbers over the last five years, called for a comprehensive review of all taxes, levies and charges in the air transport sector.

She said: “One thing I will also say from this other side of the divide is, in the last five years, post-COVID pandemic, there has been improvement in the revenue generation in aviation as a whole. “Of course, we know that aviation is highly regulated.