The Federal Airports Authority of Nigeria (FAAN) on Thursday said it has increased its Passenger Service Charge (PSC) by 100%.
The PSC is collected from passengers travelling from both domestic and international airports. FAAN compels domestic flight passengers to pay N1000, while international passengers are billed $50 each as PSC by FAAN.
Attempts by the agency to increase the PSC in 2018 and 2019 were rejected by travellers and aviation stakeholders.
But FAAN said on Thursday that its revenue has dropped by 95 percent in the wake of the COVID-19 pandemic lockdown, thereby necessitating the need for an increase.
FAAN Managing Director, Rabiu Yadudu, said this at a press conference in Abuja.
The increase of the charge from N1,000 to N2,000 per passenger for domestic flights, Yadudu said, would take effect from September 1 and had been communicated to all airlines.
“The increase is a matter of necessity. Our revenue is down by over 95 percent. In that case, we will do whatever we can legitimately to ensure we carry out our duties. We need to survive. There is no better time than now for FAAN to do this,” he said.
Describing airport management as capital intensive, Yadudu noted that FAAN has not increased PSC since 2011 despite all the huge capital investments at the nation’s airports.
He said the current N1,000 charge was no longer realistic and that it did not correlate with realities of cost-related inflation rate which the Central Bank of Nigeria put at 12.82 percent.
He also said that the Federal Government plans to increase its direct deduction from FAAN to 40 percent from 2021. He said with such deduction, FAAN will have a shortfall of over N16 billion on overhead cost, hence, the authority decided to engage the government in order to be exempted from the deduction.