Virgin, BA fares exploitative – Senate

on MARCH 23, 2012 · in HEADLINES

By Kenneth Ehigiator & Inalegwu Shaibu
ABUJA— Senate said yesterday that the Federal Government loses about N3.7 billion annually to violation of Nigeria’s aviation laws by British Airways and Virgin Atlantic.

The loss includes the statutory five per cent ticket sales charges accruable to the federal government, even as the Senate President, David Mark, accused the aviation regulatory agencies of colluding with foreign airlines to hike air fares in Nigeria. This came as a Passengers Bill of Rights that would guarantee passengers a fairer deal is being proposed to be sent to the National Assembly by the Ministry of Aviation.

Senate’s move followed the adoption of a motion on the violation of aviation laws and practice by foreign airlines in Nigeria, sponsored by Senator Hope Uzodinma (PDP-Imo) and 28 other senators.

From the right, Vice Prresident Namadi Sambo; SGF, Senator Pius Anyim; Head of Service, Alhaji Saleh Belo; Chief of Staff to the President, Chief Mike Oghiadomen; National Security Adviser, Gen. Owoye Azazi; Youth and Sports Minister, Mr. Bolaji Abdullahi and the Works Minister, Arc. Mike Onolememen singing the national anthem during the opening of the Federal Executive Council Meeting chaired by the Vice President at the State House, Abuja. Photo by Abayomi Adeshida

Senate President, David Mark during the consideration of the motion entitled, Violation of Aviation laws and Practice by Foreign Airlines in Nigeria,  indicted Federal Airport Authority of Nigeria, FAAN, Nigeria Civil Aviation Authority, NCAA, and National Airspace Management Agency, NAMA. He described the arbitrary fare charged by British Airways and Virgin Atlantic as exploitative and unreasonable.

Senate President said that this practice had continued as a result of the failure on the part of the regulatory authorities to checkmate the excesses of the foreign airlines.

“It has been on for a very long time, and our regulatory agencies are in fact part of the problems because they have refused to act in any way that would force British Airways to reduce its fares.

BA, Virgin fares are exploitative, unreasonable - Mark

“It is exploitative and nobody should be allowed to exploit Nigerians.”

Mark said “the prices given are completely out of range, it is unreasonable; it is exploitative and nobody should tell us to sit down here and not do anything about it because Nigerians are willing to pay.

“Our regulatory agencies have done absolutely nothing. In fact, they are part of the problem because they have been colluding with them; otherwise they would have been the ones to raise the issue. They have watched helplessly, they have refused to act otherwise they would be the ones to force British Airways to look at what they are doing.”  He added that the Civil Aviation Act 2006 requires amendment because it failed to provide punishments for persons that violate aviation laws in the country.

Mark said that although the Aviation Minister had given the foreign airlines a 30-day ultimatum to reduce their fares, the Senate would not stop in its mandate to protect Nigerians.

He charged the committee to work swiftly on the investigation and ensure that the report was brought to the Senate within three weeks.

Senator Uzodinma, while leading the motion alleged that the conduct of the British Airways and Virgin Atlantic actually translates to colossal loss of revenue to the Federal government accruable from the statutory five per cent ticket sales charge.

Travel agencies suffering loss - Uzodinma

He also said that travel agencies and Nigerian travelers suffer huge financial loss.

Uzodinma held that the foreign airlines charged higher fares from Nigerians on routes of equal distance than they charged from other countries to different parts of the world.

“The return fare for first class from Lagos to London is 10,816 dollars. Abuja to London return flight is 10,144 dollars, whereas the same booking for a passenger on the Accra-London route is 4,798 dollars. ‘The business class return fare from Lagos-London is 7,370 dollars, and Accra-London route is 4,098 dollars.

“The return economy tickets from London-New York is 625 dollars; London-Dallas is 787 dollars, London Florida is 730 dollars.

“These routes are nine hours flight minimum, while the cheapest economy return ticket from Abuja-London which is six hours, is 1,200 dollars.”

This, he added, made some Nigerians to travel through Accra to London, and this amounts to colossal economic loss to the country.

According to him, a recent investigation by the Nigerian Civil Aviation Authority has indicted British Airways and Virgin Atlantic Airways of collusion and anti competitive practises within the Nigerian Aviation airspace.

Senators who spoke condemned the exorbitant fares while urging the federal government to prevail on public office holders to shun foreign airlines in favour of local airlines.

Contributing to the debate, Sen. Enyinnaya Abaribe (PDP-Abia), advised Nigerians to be more patriotic and use Arik Airline, a local carrier that was much cheaper while lamenting  the economic downturn caused by the arbitrary fare regime and the lapses in the civil aviation laws.

Abaribe was also of the view that the Federal Government should compel its officials to patronise the Nigerian carrier. He said: “We have to ask whether we believe in Nigeria or pay lip service with what Nigeria stands for. The Civil Aviation Act of 2006 has limitation which makes it impossible for NCAA to impose sanction on air lines that violate our aviation laws. This will be a good time to revisit the Act.”

Aviation laws should be amended - Abaribe

He called on the Senate to effect the necessary amendments to the aviation laws to place stiffer sanctions on airlines that contravened the law.

Also kicking against the high fare, Senator Uche Chukwumerije described the arbitrary pricing as discriminatory, provocative and neo-colonialist.

Senator Barnabas Gemade in his contribution however argued that the federal government should compel government officials who constitute about 80 per cent of those who patronize these foreign airlines to stop patronizing them.

Regulatory agencies colluding with airlines - Adetunmbi

On his part, Sen. Olubunmi Adetunmbi (ACN-Ekiti) said that the practise of higher air fares was possible in Nigeria “because apparently, the regulatory agencies were colluding with the airlines”.

Adetunmbi urged the committee to concentrate on why the practice had been going on for so long and yet nothing had been done to check it.

Sen. Attai Aidoko (ACN, Kogi) said that a huge percentage of the current budget was spent on foreign trips due to the high fares charged by the airlines.

Aidoko urged the investigating committee to also look at the implication of the high cost of air fares on the national budget.

Some Senators said the airlines charged exorbitant fares due to high cost of doing business in Nigeria as a result of electricity shortage.

The investigation is to cover all the issues related to compliance or non compliance with relevant aviation laws and all unwholesome activities by foreign airlines.

It will also look at the role played by regulatory agencies that undermined the growth of the aviation industry in Nigeria.

The Senate also received an executive Bill from the President on the Establishment of the Federal University of Petroleum Resources, Effurun in Delta State.

Meanwhile, the Ministry of Aviation is putting finishing touches to a bill that would guarantee passengers a fairer deal.

The bill, Passengers’ Bill of Rights, is to be forwarded to the national Assembly for passage as soon as possible, according to the Special Adviser to the Aviation Minister, Mr. Joe Obi.

“One of the salient provisions in the proposed bill stipulates that a passenger has a right to compensation, if his or her flight is delayed for more than one hour, outrighly cancelled or where a passenger is denied boarding without any reasonable cause.

“The proposed bill also makes provisions for passengers with special needs, right of passengers to best price information as well as flexible/refundable tickets at cost.

“The bill also proposes adequate compensation if a passenger’s flight departs before the ticketed time, compensation within five business days for loss or unnecessarily delayed baggage, provision of decent lodging and feeding for flights delayed overnight as well as two hours advance notice if flight is to be re-routed or delayed, amongst others,” Obi said.

SOURCE:  Vanguard Newspaper, 29 March 2012. http://www.vanguardngr.com/