Review deduction of 40% from IGR, FAAN asks FG

By Abiodun OBA

The Federal Airports Authority of Nigeria (FAAN) has called on the Federal Government to review the continuous deduction of 40 percent from the internally generated revenue (IGR) of the agency as it takes toll on its financial obligation.

Recall, the deduction was in line with the Federal Government’s policy directing all agencies, including those in the aviation sector, to remit 40 percent from their IGR into the Treasury Single Account (TSA).

Deputy Director of Finance at FAAN, Mr Philip Emeto, lamented how FAAN has been finding it almost impossible to execute capital intensive projects such as airport infrastructure rehabilitation, upgrade of terminals, provision of airfield lighting, acquisition of security equipment and many others.

According to Emeto, these projects are critical to the smooth running of airports, in line with the stipulations of the International Civil Aviation Organisation (ICAO) adding that the remaining 60 percent income, out of which salaries will be paid, is not sustainable.

FAAN presently manages 26 airports across the country, apart from the ones some state governments intend to hand over to it.

Emeto said with the remittance of 40 percent of the IGR to the TSA by the agency, including its aeronautical and non-aeronautical revenues, the government should take over the responsibility of executing FAAN projects.

The FAAN director said the policy was responsible for reasons some roads at the airports are in deplorable conditions, while other major projects like the erection of security and perimeter fencing at some airports under the management of FAAN were not being executed.

He stated that due to low financing, FAAN had not been able to achieve its plan to reduce the number of daylight airports in the country, through the installation of airfield lighting.

Emeto stated, “FAAN is facing a huge financial dilemma because the same money needed to upgrade facilities and embark on training is what is remitted to government account.”

“We are calling on the Federal Government to please review this policy because it is from the internally generated revenue that FAAN pays its workers, maintain the airports and addresses infrastructure deficit, most of which are highly capital intensive.

“FAAN ought to constantly embark on training and retraining of its workforce, upgrade its security infrastructure and regularly maintain the runways among others, but doing all this is becoming increasingly difficult due to the fact that almost half of our revenue is remitted to the government.”