FULL TEXT MINISTER OF AVIATION 2020 BUDGET DEFENCE AT NASS_ Ada Nkong

I have the privilege to present to the Chairman and Distinguished Members

of the Senate Committee on Aviation, the 2019 Budget Implementation

status and our Proposal for 2020 Budget which is before you for

consideration

2019 PERFORMANCE

The total Capital Appropriation for the Federal Ministry of Aviation in 2019

was N 35, 334,058,175.5 out of which the sum of N 7, 330,178,427.45

representing (20.8%) was released to the Ministry. So far

N 2, 627,119,597.14 has been paid out from the released 2019 Budget

However, some Certificates of completion of Projects are being processed

for payment. In addition, the sum of N508,800,000.00 was appropriated for

Overhead expenditure for both the Ministry of Transportation and Ministry of

Aviation in 2019 out of which the sum of N220,000,000.00 representing

(43.2%) was released to the Ministry of Aviation while N 220,000,000

representing 100% ) of the Total release had been expended to date. The

details of 2019 Budget Performance are enclosed herewith as Annexure (A).

You may wish to note that while the Main Ministry is funded from the

National (FGN) Budget, those of the Agencies like Nigeria Meteorological

Agency (NIMET), Nigerian Airspace Management Agency (NAMA), Nigeria

College of Aviation Technology (NCAT), and Accident Investigation Bureau

(AIB) derive their funds from both the National (FGN) and Internally

Generated Revenue (GR) Budget while Federal Airports Authority of

Nigeria (FAAN) and Nigerian Civil Aviation Authority (NCAA) are wholy

funded from their Internally Generated Revenue (IGR]

Distinguished Senators, I am highly elated to inform you that our

Airports are wearing new look betting of modem Airports in atto of the

New Terminals (PH and Abuja) constructed by CCECC which were

commissioned last year are already in full operation while Lagos and Kano

would in a short while follow sut Following adequate provision for the

completion of the New Terminal Building at Akanu ibiam International Airport

Enugu in 2019 we are hopeful that the terminal Building would be completed

soon. More than ever before, Accident Reports are being released by the

Accident Investigation Bureau and Nigeria has just recently been elected

into the Part Il of the ICAO Council

We solat for your support to ensure that the Aviation Sectors

improved To this end, we must ensure that our airports and all the needed

equipment necessary for safety and security are provided to meet the

Standard and Recommended Practices (SARPS) as outlined by regulatory

Aviation bodies such as the International Civil Aviation Organisation (ICAO

Nigerian Civil Aviation Authority (NCAA) etc

2020 PROPOSAL

In the year 2020, the sum of N41,878,371,737 is being proposed for

Capital Expenditure. The Budget will focus on sustaining the infrastructural

renewal at the airports as well as upgrade and provision of necessary air navigational equipment and that of weather forecast. Special attention will

be given to Safety and Security Infrastructure. The detail of the 2020 Capital

Budget Proposal is enclosed herewith as Annexure (B) for your

consideration

There are challenges with the new Terminals being built with the

$500M loan from the China Exim Bank. These challenges include:

(i) changes in structural design of the airports, foundation footing

and escalators;

(ii) provisions for the biggest modern aircrafts;

(iii) change in departure and arrival floors to rhyme with the railway

station:

(iv) provision of adequate power supply to ensure all facilities are

put to use;

(v) Relocation of the Control Tower and the Fire Service Station and some other issues such as sewer and water supply

The above has resulted in the need for variation and additional works to the tune of $461,795,551.02 which has been approved by the Federal Executive Council (FEC). The China Exim Bank has indicated

willingness to consider funding the above additional works and we have written to the Ministry of Budget and National Planning to provide for the Sum of $73,887,288.16 N22,535,622,888.00 @N305/5) as counterpart fund in 2019 outside the Ministry’s proposed FGN Budget. The President has graciously approved 50% of the Sum and in 3

Months we are expecting the balance of the remaining 50% of the money. For the 2020 Budget Proposal, we have also approached the Ministry of Finance, Budget and National Planning to provided from the service wide vote the following

Counterpart funding for remedial/additional works and

completion of four Chinese terminals at Kano, Abuja, Lagos and Portharcourt (($51,800,266.99)(N15,850,881,698.94)) has been approved by Mr. President.

Viability Gap Funding for the establishment of National Carrier (N 91,800,000,000).

Reconstruction and Rehabilitation of Enugu Airport Runway (N 100,000,000,00) has been approved by Mr. President.

More Bilateral/Multilateral Air Services Agreement would be signed in 2020 for the benefits of our air travellers. We have developed a road map for the Aviation Sector that will be implemented through Public Private Partnership (PPP). These are:

Establishment of National Carrier;

Establishment of Maintenance, Repair and Overhaul (MRO) facility;

Development of Agro-Allied Cargo Infrastructure;

Establishment of Aviation Leasing Company;

Search and Rescue System; and

Establishment of Aerospace University with the support of International Civil Aviation Organization (ICAO).

We have a policy of enforcement of expatriate quota in the Industry

with the full cooperation of the Ministry of Interior and Immigration Service.

The sum of N 250,000,000 is also being proposed as overhead expenditure for the 2020 fiscal year though inadequate, it is in line with the envelope system arising from Budget guidelines. In the same vein, the sum of N 518,148,035 is being proposed as Personnel Cost bringing the total recurring cost to N 768,148,035 for your consideration. It should be noted, however, that the Personnel Cost is paid from FGN Treasury by the Office of the Accountant General of the Federation under the

Integrated Personnel Payroll Information System (IPPIS).

I am more than delighted and happy to state that Nigeria is one of the

first eleven Countries that signed the Yamassokrou Declaration which

culminated into Single African Air Transport market that was launched by

African Union Heads of State last year, in Addis Ababa. This has given our Domestic Airlines great advantage to operate in all African countries domestic markets, thereby improving their finances and offer more job opportunities for our citizens.

Nigeria has been successfully elected as Part II Council Member of

the International Civil Aviation Organization (ICAO) during the 40th Assembly September 2019. The significant of this is that Nigeria will continue to participate in the global Aviation decision body with positive consequence for the Country, Africa and the industry at large. Nigeria is

also among the 16 Countries from 193 member States that has been

found to have improved in Aviation Security and awarded Security Certificate by the ICAO President. This feat has only been possible because of the great support we are receiving from the National assembly and we look forward to also be among the countries that will earn the aviation safety Certificate, soon.

In conclusion, let me express my sincere appreciation to the leadership and distinguished members of the Senate Committee on Aviation for your understanding and support in our collective resolve to revive the

ailing Aviation Sector for the benefit of all Nigerians