NAMA appeals for revenue retention to enhance air safety operations
In a bold move to bolster the safety and efficiency of Nigeria’s airspace management, the Managing Director of the Nigerian Airspace Management Agency (NAMA), Farouk Ahmed Umar, has urged the Federal Government to allow the agency greater access to its Internally Generated Revenue (IGR). This appeal comes in the face of significant financial constraints that threaten the agency’s ability to maintain and upgrade critical infrastructure.
The Heart of Aviation
Speaking at NAMA’s headquarters in Abuja, Umar emphasized the critical role that NAMA plays in ensuring the safe conduct of flights within Nigeria’s expansive airspace, which also includes the Gulf of Guinea. “NAMA is the heart of the aviation industry,” Umar stated. “Our responsibility is to ensure the safe navigation of all flights, which requires advanced safety-critical equipment, continuous personnel training, and adherence to both national and international safety standards as outlined by the International Civil Aviation Organization (ICAO).”
Financial Challenges
Despite these crucial responsibilities, NAMA has been grappling with financial constraints, largely due to a policy that mandates a 50 percent deduction from its revenue. Umar described this policy as unsustainable, noting that it severely hampers the agency’s operations. “The safety of our airspace is paramount, and the current financial model is unsustainable,” he argued. “The 50 percent revenue deduction hinders our ability to maintain and upgrade critical infrastructure, such as our obsolete surveillance systems, which are over a decade old and urgently need replacement.”
Cost Recovery Principle
Umar highlighted that NAMA operates on a cost-recovery principle recommended by ICAO. This means that all charges levied by NAMA are intended solely to recover the costs incurred in service provision, rather than generating profit. However, the current practice and net estimate of IGR are insufficient to cover NAMA’s recurrent and capital expenditures, posing a significant risk to air safety. “Without adequate funding, we cannot meet the high costs of procuring and maintaining essential equipment, or ensuring the continuous training of our technical staff, which is vital for maintaining safety standards,” he said.
Revenue Allocation Discrepancies
One of the major points of contention raised by Umar is the current revenue-sharing formula, which he argues is skewed against NAMA. Under this formula, NAMA receives only 22 percent of the revenue, while the Nigeria Civil Aviation Authority (NCAA) receives 56 percent, despite having fewer responsibilities. “This formula is unfair to NAMA,” Umar contended, “given the substantial capital requirements of our investments, jeopardizing our ability to meet both national and international obligations.”
Call for Policy Reversal
Umar passionately called for the reversal of the 50 percent revenue deduction policy. “Restoring the full revenue allocation to NAMA is essential,” he asserted. “This will enable us to address critical infrastructural needs, enhance operational efficiency, and ensure the continuous training of safety-critical personnel. With adequate funding, NAMA can fulfill its mandate to provide safe and reliable air navigation services across Nigeria’s airspace.”
He further elaborated on the broader implications of the current financial model, suggesting that operating at a deficit contradicts the financial regulations and existing rules outlined in the Fiscal Responsibility Act of the Federal Republic of Nigeria. “Reversing the 50 percent revenue deduction is the only way NAMA can significantly enhance air safety,” Umar insisted. “Nigeria’s skies must remain safe and maintain high safety standards.”
Stakeholder Support
Umar’s appeal extends to all stakeholders in the aviation sector, urging them to support this necessary change. “The implications of our current financial model are significant and unsustainable,” he warned. “For the future of our aviation sector and the safety of the flying public, it is crucial that we secure the necessary funding to continue our operations effectively.”
The plea from NAMA’s Managing Director underscores the urgent need for policy adjustments to ensure that Nigeria’s air navigation services remain robust, safe, and in line with global best practices. As the heart of the aviation industry, NAMA’s ability to operate efficiently is crucial not only for the safety of flights within Nigeria’s airspace but also for the broader goal of maintaining the country’s reputation as a safe and reliable airspace.
