IT would seem, the quest for a new Safety Threshold Ground Handling Charges for the ground handling companies have paid off with strong indications that the Nigerian Civil Aviation Authority (NCAA)has granted approval for new charges 35 years after it was last amended.
According to reports reaching NigerianFLIGHTDECK, the new charge rate which was last amended in 1986 would commence from October 1, 2021 (international carriers) and January 1, 2022 for domestic operators.
NCAA, according to information received, has now approved between $1,500 and $5,000 (passenger and cargo flights) for handlers for a narrow and wide body aircraft, respectively, while for domestic operators will now pay between N20,000 and N70,000, depending on the aircraft type.
Narrow body aircraft include Boeing B737, Airbus A320, ER 135 and ATR, while wide body aircraft are B767, A330, B777, B747 and B787.
With this approval, ground handling companies in Nigeria, Skyway Aviation Handling Company (SAHCO), Nigerian Aviation Handling Company (NAHCO), Precision Aviation handling Company (PAHCOL) and Swissport can now charge the same handling rates as their counterparts in the sub-African countries.
These charges as compared with other countries in Africa were far from being appropriate as an operation that cost $4,000 elsewhere was done in Nigeria at $400
A circular signed by Director General of the NCAA,Captain Musa Nuhu, dated September 6, 2021 with the reference number: NCAA/DG/AIR/11/16/315, addressed to “All Airlines and Ground Handling Companies” (foreign and local) set different dates for the commencement of the new charges. Read More: AGHAN seeks review of handling charges upwards; asks FG to waive 5% concession fee
The circular with the subject: “Safety Threshold Ground Handling Charges,” read in part: “All stakeholders are invited to note that the new ground handling rates for international and domestic operations will become effective on 1st October, 2021 and 1st January, 2022, respectively.
Chairman, Association of Ground Handlers (AGHAN), Mr. Olaniyi Adigun who spoke on this development had nothing but praises for the Minister especially with his appointment of technical personnel across board who understand the impact of the decision.
He said,”I am not surprised at the performance of the minister and the DG NCAA. This is the first time in a long while that the aviation industry is speaking with one voice across board. The minister himself is an aviator; he understands our plights and he knows the right thing to do.
I also want to thank the minister for appointing technocrats across board. The DG of NCAA for instance has wealth of experience in the sector and was a Nigerian representative at ICAO for several years before he was appointed DG NCAA. Kudos to him for ensuring that this sub-sector is regulated. AGHAN is thanking the minister for saving the sector from extinction.
“In fact, the federal government saved us from extinction because the low pricing was gradually killing the ground handling sub-sector. Income derived from our operations could not sustain us vis-à-vis the current reality on ground. Dollars have gone up and these equipment are foreign; 80 per cent of our training is foreign and to cap it all, aviation industry is global…Most of what we do require dollars and for you to even operate in this sector, you must be certificated, which can only be achieved through training.
“With the right pricing in handling rates, we will be able to provide quality, efficient and safe service delivery to our clients. We will be able to compete with any service provider gradually and we will be able to acquire modern equipment that can facilitate handling. To me, it’s a new dawn and a new development that will inject more lives into the industry. Handling charges: Ground handlers seek NCAA support to create pricing threshold
On the impact the previous charges had and the current charges would have on the economy, Adigun explained that other African countries charging at $4,000, remit 5 per cent of about $200 to their governments while the Nigerian Government is getting just $20 stressing that the disparity was miles apart and is a lot of capital flight out of the country.
He went on,”Like I said earlier, the government is getting 5 per cent of our total annual revenue and with more money, we will have improved manpower, create more jobs for teeming Nigerians. At it is, we have a lot of unemployed youths, but we are not able to attract them and even the ones that we have, we couldn’t retain them. There will be better service delivery, safer sky and encouragement of more investors to come in.
Vice Chairman, AGHAN, Mr. Ahmed Bashir, also commended the Minister of Aviation,Hadi Sirika as well as the CAA and management of all the ground handling companies who stayed true to the cause.
He said,”The Minister of Aviation’s vision has always been a safer sky for Nigeria and to ensure that safety, the ground handlers are integral part of that vision. Everything that you see that we have achieved, we give credit to the minister because the minister has acted as a father to all. It is through his vision that we achieved stability in the industry. He has brought in innovative ideas that helped to transform the industry.
“We want to thank the managements of the ground handling companies who supported and trusted us to be able to go this far. ..Also, the regulator, Nigerian Civil Aviation Authority (NCAA) for reviewing the current safety threshold handling rates and ensure compliance with the International Air Transport Association (IATA), the International Civil Aviation Organization (ICAO) Safety and other international bodies.
He said that the NCAA has always craved a stable and an economically viable industry and knows that when ground handlers are financially stronger, they will be able to sustain the industry, ensure safety and security of the industry.
“NCAA knows that every part of our business is capital intensive. And as we all know, safety starts and end on ground. You have little or no control actually when the aircraft is in the air. So, in order to ensure that the ground handlers are financially stronger and remain as a critical component of the industry, NCAA tried to ensure that the industry doesn’t collapse. The fact is that without the ground handlers, NCAA will also be out of business.”
“You cannot buy modern equipment if you are financially weak, you cannot attract and retain quality manpower if you are economically weak. So, the economic regulation is to ensure that we have a healthy and a vibrant industry. Kudos to the leadership of NCAA.”
Monitoring for compliance
The circular issued by the NCAA also read that,“All stakeholders are directed to ensure full compliance with the safety threshold ground handling charges. Any change to these charges must be done in formal consultation with and approval of NCAA. Please be guided accordingly…
According to Adigun, the circular shows there are procedures to operate and charge whatever you intend to charge within the threshold and the ground handlers are coming out with an MoU bent on ensuring compliance.
He said, “AGHAN is coming out with an MoU which will stipulated disciplinary measures for violators of the directive. No one wants to be the odd one out. Also, what will you gain for charging below the approved safety threshold handling charges? You can go above, but you cannot go below the approved rates.
“If the hospitality industry and airlines are charging various rates for their services, what stops us from replicating the same in the sub-sector? It is a win-win situation for all us.”
The impact of this new pricing threshold is massive for the industry as experts believe it will ensure financial stability for the handlers,enable them recruit more Nigerians and increase the welfare of staff.
It will also ensure that ground handlers have better and modern equipment, develop capacity, initiate modern trainings most of which are cost-intensive with some of the training not even conducted here in Nigeria.