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Friday, September 21, 2012

Arik Air Suspends Domestic Flights, Accusing Aviation Minister, Stella Oduah Of Corruption

Arik Air is alleging that it is suffering because the ego of the aviation minister was bruised  when it refused to accede to ‘personal interest’ requests.
Corrupt demands allegedly made by the Minister of Aviation, Stella Oduah, led to the disruption of flights by Nigeria’s largest domestic carrier, Arik Air. Arik Air, suspended indefinitely all its domestic operations after aviation union workers from the Federal Aviation Authority of Nigeria (FAAN) disrupted its flights out of Lagos on Thursday.
According to PREMIUM TIMES: Union members gathered at the domestic wing of the Murtala Muhammed Airport as early as 7a.m. and prevented the airline from operating its normal flights over allegedly unpaid debts. The union members claimed that the airline owes aviation agencies a combined debt of about N17bn, a claim the airline denies. Despite the public knowledge of Arik’s debt, the grounding of the airline’s operations by the union members, sources say, is a reflection of the intention of Ms. Oduah.

The 5 per cent demand 
 Ms. Oduah, sources told PREMIUM TIMES made a demand from Arik’s owners, a demand too much for the management to let go of. The Vice-Chairman of Arik Air, Aniete Okon, hinted at the minister’s ‘greedy’ demand while addressing journalists in Lagos, Thursday afternoon when he said the airline is being punished for its refusal to accede to the personal interest of Ms. Oduah. “This is a direct result to the rebuff that the minister suffered when she tried to promote personal rather than national interest,” Mr. Okon said. Mr. Okon, fearing a direct confrontation with the minister, a close ally of President Goodluck Jonathan, declined to give details of Ms. Oduah’s demands. Multiple and usually reliable sources however told PREMIUM TIMES that the “personal interest” Ms. Oduah demanded, was a part ownership of Arik. “The Minister wants 5per cent share of Arik at all cost, which has been resisted by the Arik Chairman,” a close source to the two parties said. The source also alleged that Dana Air, whose operating license was returned after suspension following its airline crash of July, agreed to the minister’s demand before it was permitted to operate again. 

Arik is a dying airline
 The Aviation Minister has however denied having personal interest in Arik. Ms. Oduah speaking through her media assistant, Joe Obi said the allegations by Arik is a diversionary tactic. “Arik should be advised to live up to its responsibility as a corporate citizen and stop chasing shadows,” Mr. Obi said. He said the minister never demanded a part ownership of Arik. “Why will the minister want to have a stake in a business that is not thriving. The minister has never and will never show an interest in an ailing firm,” Mr. Obi said. The minister also denied having any secret deal with Dana before the lifting of its suspension. Mr. Obi, while explaining the Ministry’s decision to lift Dana’s suspension even when the airline was yet to pay adequate compensation to all the families of the crash victims, said Ms. Oduah did the right thing. “Where is it done that if an aircraft in a fleet has an accident, the entire aircraft is grounded?” he said, explaining that the ministry and its agencies were carrying out adequate certification of Dana’s fleet. Mr. Obi could however not give the correct value to Arik’s debt.

 How much does Arik owe?
A breakdown of the sum the aviation union accuses Arik of owing shows that Arik Air owes FAAN N7bn; the Nigerian Airspace Management Agency, NAMA, is owed N5 billion naira; and the Nigerian Civil Aviation Authority, over N4 billion. Though Arik admitted it was owing the aviation agencies, it denied the circulated figures. The airlines Managing Director, Chris Ndulue, said, “the amount the agency (FAAN) is claiming is fictitious and baseless.” “We have an outstanding balance of N1.6bn from the period before FAAN/Ministry of Aviation started “Pay-As-You-Go (payment in advance). In January 2011, the former minister of aviation directed that such outstanding be cleared within thirty months. We have been paying down on the amount installments of N100m per month. We will continue to do so,” Mr. Ndulue said. Mr. Obi, the minister’s spokesman questioned Arik’s integrity accusing the management of financial irresponsibility. “Part of the money they are owing is not their money. They are part of the airfares they have collected from passengers and are supposed to remit to the government,” he said. “Instead they keep them (the money) to themselves.” 
Arik is blackmailing Government 
 The aviation minister also accused the Arik management of blackmailing the government. “The decision to suspend its operations is a blackmail tool,” Mr. Obi explained. “We can never be blackmailed.” Arik claimed it was suspending its operations nationwide due to what it described as “persistent hostility of the Ministry of Aviation and Federal Airport Authority of Nigeria (FAAN) management.” The management of FAAN however released a statement this afternoon distancing itself from the action of the union members. The agency said it was “not aware of any plan by the unions to embark on the said industrial action.” “Management considers it to be counter-productive to the current efforts being made to recover debt owed FAAN by Arik Airline or other customers.” The agency said it was doing everything possible to resolve the issues that led to the industrial action. 
Let the court be the arbiter
 Human rights lawyer, Femi Falana, who could not travel to Abuja due to the industrial action, told PREMIUM TIMES that the union shouldn’t be preventing passengers from travelling. “I had cause to address the leaders of the workers. I did make it clear to them that workers have no business inconveniencing passengers,” he said. He advised that instead of disrupting the operations of the airline, the agency should take their case to the court. “It’s the duty of regulatory agency to collect the money from the money from the airlines that are owing and if any of them refuses to pay the proper action in the circumstance is to go to court.”

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