Airfares May Rise As FAAN Hikes Service Charges By 100%

Airfares on domestic and international routes are set to rise as the Federal Airports Authority of Nigeria is to increase the passenger service charges on flight tickets by 100 per cent from August 1, 2020.

It was gathered that the authority would increase the PSC on domestic flights from the current rate of N1,000 to N2,000.

FAAN would also hike the PSC on international flights from $50 to $100, a development that would warrant a rise in airfares on local and international tickets.

Airline operators confirmed the development to our correspondent on Friday in Abuja, as they stressed that the hike in PSCs would definitely be passed to passengers.

Airlines collect the PSCs on behalf of FAAN when selling flight tickets to passengers.

FAAN’s Managing Director, Rabiu Yadudu, made the agency’s position on PSCs known in a letter to airlines.

He told the airlines that the decision was based on the approval given by the Minister of Aviation.

Yadudu’s letter to all airlines was dated June 22, 2020 with reference FAAN/HQ/MD/18E/VOL.86/72.

It was titled ‘Implementation of the approved new passenger service charge effective August 1, 2020’.

The approval from the minister was contained in a letter with reference FMT/FMA/COM/T/69, dated August 3, 2017.

Yadudu explained that the intention of FAAN was to improve and upgrade airports infrastructure across the country, among others.

He said while the authority had notified the aviation minister, it had engaged the regulator of the sector and other operators several times about its intention to hike PSCs.

The several engagements, according to the FAAN boss, prompted the delay, as approval had been given since over two years.

Yadudu said the last PSC reviews were done on May 1, 2011, and March 21, 2011, for domestic and international flight operations respectively.

He noted that in 2011, domestic PSC was increased from N350 to N1,000, while that of international flights was raised from $35 to $50.

“This does not correlate with the prevailing economic situation and the index to meet the needs of today and future growth in passenger traffic by FAAN and airport development, most especially for the airport upgrade to post-COVID-19 standards,” Yadudu said.

He explained that Bi-Courtney Aviation Services Limited, operators of the Murtala Muhammed Airport 2 domestic terminal, had for years been charging N2,500 as its PSC.

He argued that an increase in PSCs by FAAN would afford the authority the needed funds to upgrade its facilities to accommodate new airlines, including the anticipated national carrier.

Confirming that the latest hike in PSCs would lead to an increase in airfares, the Chief Executive Officer, Aero Contractors, Capt. Ado Sansusi, said the charge would be included in ticket costs on domestic and international flights.

He said, “There has been discussions about this pre-COVID-19. However, the matter is simple; this money is not for airlines, rather passengers will pay it.

“We the airlines will just pass it to the passengers as the name suggests.”

On whether this would not add to the financial burden of passengers considering the negative effect of COVID-19 on incomes, Sanusi said FAAN should compensate passengers by improving its services.

He said, “I think that should be addressed by the people who are hiking the prices.

“However, the argument now should be whether there will be value for the money. If the services are not commensurate to the pay, passengers have the right to demand better services.”

When contacted and told that passengers might not find the increase palatable considering the harsh economic realities currently, FAAN declined to comment.

The General Manager, Corporate Affairs, FAAN, Henriatta Yakubu, said the notice was sent to the airlines and not the press and as such the authority would not make any comment to the media about it.

The spokesperson of Air Peace, Stanley Olisa, said the international and domestic carrier was aware of the notice from FAAN.

The President, Association of Foreign Airlines and Representatives in Nigeria, Kingsley Nwokeoma, kicked against the development.

“That is not a good thing for us this time. It means that FAAN is insensitive to the plights of citizens,” he stated.

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