FAAN Raises Passengers’ Service Charge by 100percent

Following the shift of the resumption of International flights by the FG to September 5th, FAAN has made some few changes as well

According to report, the Airline Body has increased all passengers’ service charge fee by 100percent

This new change is to kick off by Monday, 1st of September 2020

The announcement was made on Thursday August 27th by FAAN Managing Director Cap. Rabiu Yadudu

who said the decision was influenced by the loss recorded in the aviation sector due to the Coornavirus pandemic.

FAAN Raises Passengers’ Service Charge by 100percent

Following the review of the PSC, domestic passengers who used to pay N1000 will now pay N2000,

while international passengers within the Economic Community of West African States (ECOWAS) region

will now pay $80 while others will pay $100.

Yadudu On FAAN increament said;

“Airport management is capital intensive.

FAAN has not increased PSC since 2011,

despite all the huge capital investments at our airports.

The current PSC charge of N1,000 is no longer realistic

as it does not correlate with realities of cost-related inflation rate

which the CBN has put at 12.82per cent.

“Besides, FAAN, until late 2019

was collecting the naira equivalent of PSC

at an official rate of N305.50 – N344.38 to a dollar

when airlines were collecting at subsisting market rate of about N362 to a dollar.

“It has, therefore, become imperative to review the PSC,

from N1000 to N2,000 per passenger.

This review which takes effect from September 1, 2020

has already been communicated to the airlines.

“The passenger service charge for domestic flight was N1000

but it will now be N2000. For an international flight, it was $50 for all

but now, passengers within the ECOWAS region will be made to pay $80

while intercontinental passengers will be paying $100.

So the increment is by $50.

“This increase by FAAN is just a matter of necessity.

If it is not necessary for us to increase,

you will never see this increase.

Secondly, our revenue is down by over 95perc ent.

FAAN is a service delivery agency and if you are delivering service

and your revenue is down by 95per cent, what do you do?

You will do whatever you can legitimately

to continue to deliver the service with the same level of quality.

“The increase of PSC does not even assure

or guarantee us that we will be back to normal

but it is just the beginning.

This is just one aspect of the necessity

because we need to survive and keep delivering

and that is why we are increasing it.”

“You have to understand that almost every aspect of our operation is business

and in this modern-day, it is relative.

“If you look at it from the aspect of the passengers and airlines,

it is clearly not the most appropriate time

but if you look at it from the point of view of the service providers

that is about to be consumed by the pandemic and the economic situation,

then there is no better time for FAAN than this time

because it would have been worse if we just sit down and fold our arms.

“It is therefore worthy of note that the Federal Government

is increasing its direct deduction from FAAN to 40 per cent from 2021.

“With such deduction, the Authority

will have a shortfall of over N16billion on overhead cost.

The Authority is however engaging the federal government

to exempt her from this deduction.”