Aviation Sector Debates Revision of Revenue Distribution Formula

Aviation experts and regulatory bodies are clashing over a proposed amendment to the revenue-sharing formula of the five percent Ticket Sales Charge, sparking debate over whether funds should favor infrastructure upgrades or regulatory oversight.

Aviation stakeholders in Nigeria are intensifying demands to adjust the five percent Ticket Sales Charge and Cargo Sales Charge distribution. Proponents argue that the Nigerian Airspace Management Agency requires additional funding to modernize essential navigation infrastructure.

The Nigerian Civil Aviation Authority opposes this shift, warning that any reduction in its current 56 percent allocation could compromise its safety oversight capabilities. Michael Achimugu, the authority’s spokesperson, emphasized that the NCAA relies heavily on these funds to execute its regulatory duties, unlike other self-sustaining entities.

A bill currently under legislative review proposes reallocating shares, potentially reducing the NCAA’s portion to 40 percent while increasing the share for the Nigerian Airspace Management Agency to an equal 40 percent. Aviation experts, including retired Air Commodore Ademola Onitiju of the Aviation Safety Round Table Initiative, support this adjustment, noting that upgrading navigational equipment is vital for both national and international safety standards.

Group Captain John Ojikutu, another industry expert, criticized the current split as inequitable, highlighting that the high cost of maintaining specialized navigational systems requires more significant financial support for the agency managing the airspace. Conversely, Roland Iyayi, a former leader of the agency, has challenged the validity of the charge itself. He contends that the current system is unsustainable for domestic airlines and suggests transitioning to a dedicated Aviation Development Fund to ensure capital is properly invested in infrastructure rather than diverted.

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