Senate to summon Sirika over failed concession agreements


As the minister of aviation, Senator Hadi Sirika, continues to market the idea of airport concession to stakeholders in the aviation sector, the senate says it would block the concession of airports if the minister does not explain why past concession agreements were obeyed in breach.

The chairman, senate committee on privatisation, Mr. Ben Murray-Bruce who stated this in Lagos said the minister would be summoned to explain why the concession agreement between the Federal Airports Authority of Nigeria (FAAN) and Bi-Courtney Aviation Services Lit (BASL) which manages the Murtala Muhammed Airport Terminal 2 failed.

Murray-Bruce who also state that he would personally lobby the senate to starve the aviation sector of any budgetary allocation in 2017 added that the lawmakers would frustrate the proposed airport concession until the FAAN-BASL imbroglio was resolved.

“We won’t allow the four airports to be concessioned when the crisis over the concessioning of the MMA2 airport has not been settled because it has created a bad image for the country.

“You have to abide by the agreements that you sign; you can’t get the best (private sector firms) because they are frightened and will not come knowing that when agreements are signed here we don’t honour the terms,” he said.

In addition, he said the legislators would sanction any government official, including lawyers, found wanting in any agreement with private investors.

“If you sign an agreement that you do not intend to honour, you are then frightening the people who want to get involved in concession or privatization. If you have a bad reputation as a government, then, it translates to your successor.

“Agreements signed with private investors by the government must be honoured. If you don’t want to honour it because you feel it is bad, then, all those who participated in such agreements including lawyers must be tried for sabotaging the government.

“We are all aware that the ministry of transportation wants to concession multiple airports, which is fantastic. This means billions of naira, which would be spent on the aviation industry, would now be diverted into other sectors of the economy. For all I know, the minister may not be aware of what the problems are in the sector,” he added.

Besides, he said: “The MMA2 agreement is binding and must be implemented. If you don’t implement that agreement, you will frighten away investors. We have reputation of not keeping to agreements.

“We read in the papers that the federal government wants to concession multiple airports. The billions of naira we would have used will be devoted to education.”

“There is an agreement that West African flights will also depart from MMA2 but that has not happened. Why has it not happened?

Earlier in his remarks, the managing director of BASL, Capt. Jari Williams had accused FAAN of obeying the concession agreement in breach.

He said the agency had consistently breached the concession, most notably with the redevelopment and continued operation of the General Aviation Terminal (GAT) in contravention of the exclusivity clause in the agreement with the concessionaire.

He said the continuous operation of GAT by FAAN had reduced by 50 per cent its (BASL’s) expected revenues, saying that MMA2 was projected to process four million passengers annually.

“FAAN continues in this willful disregard for the rule of law, without any consideration for the impact on the ability of BASL to recoup its investment in line with the objectives of the concession agreement,” he added.



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