NCAP 2013: Abrogation of the NCAA’s economic regulatory function is contrary to the civil aviation act of 2006, and National interest.

NCAP 2013: A GOOD ATTEMPT PLAGUED BY UNDESIRABLE FLAWS


The object of good governance is to promote a strong, viable and competitive business environment in the aviation industry. It begins with a process that sees the emergence of acceptable and competent leadership followed by enabling laws that will create a conducive environment for stakeholder engagement and group synergy. A starting point for the Managers of our aviation system is the adoption of sound policies and resilient strategy-planning processes that will extract maximum advantage from strengths and opportunities, whilst mitigating weaknesses and eliminating threats. In short, to secure and maintain competitive advantage. The new National civil aviation policy; NCAP 2013 has the semblance of a good policy document. However, detailed examination has revealed a plethora undesirable flaws.

Abrogation of the NCAA’s  economic regulatory function is contrary to the civil aviation act of 2006 and will dilute the effectiveness of the regulatory agency

The new National civil aviation policy (NCAP 2013, Part 3.2) seeks to repudiate NCAA’s economic regulatory function and assign it to a yet to be created 'autonomous' National aviation economic regulatory unit (NAERU) which will be under the Federal ministry of aviation (FMA). The Civil Aviation Act 2006 clearly states that economic regulation of the airline industry is in the responsibility of NCAA. The directorate of air transport regulation (DATR) has this function specifically assigned to it. It is still doubtful what informed this regressive strategy. Creating another autonomous unit with all its attendant organisational paraphernalia will further exacerbate the current high cost of governance, increase the bureaucratic bottlenecks in our regulatory processes and introduce another demi-god in the aviation system.

Two heads are better than one only when they are working to achieve the same objective

The danger with this proposal is that it will introduce a communication chasm between safety and economic regulation as the two in-congruent autonomous bodies will most likely become embroiled in a power struggle to assert their supremacy. As always when two elephants fight, it is the grass that suffers. This will make prompt coordinated remedial action almost impossible. The outcome will dilute the effectiveness of the NCAA in performing its statutory functions with regards to aviation safety, consumer protection and anti-trust matters. Ideally, in a fully developed and stable free market environment, the merits of prescriptive economic regulation and its attendant price control mechanisms are considered archaic and unnecessary. As the relevant market forces are expected to determine stability and balance. The prevalence of issues such as abuse of market dominance, predatory pricing, unreasonable discrimination between classes of users, allegations of monumental fraud, in FAAN, NAMA, NIMET, etc. are clear indications that the industry in Nigeria is suffering the consequences of loss of economic efficiency. Hence the need for adroit economic regulation.

There is a clear distinction between statutory economic regulation and the financial mechanism of autonomous automated ‘single till’ revenue collection

It appears advocates of this misguided strategy are confusing the statutory functions of economic regulation with the financial mechanism of an ‘autonomous automated single till revenue collection’. The assertion in the policy document; NCAP 2013, Part 3.2  “Economic regulation of airports and air navigation services” (page 18, first paragraph) that this strategy has been adopted in the UK is also sadly mistaken. The current structure of regulation in the UK clearly indicates that the CAA is still solely responsible for economic and safety regulation. This function is jointly administered by the CAA’s Consumer Protection Group (CPG) and the Regulation Policy Group (RPG). These units are part of the CAA’s four-unit organisational structure: namely Air Safety, Economic Regulation, Airspace Regulation and Consumer Protection.
It is a fact that NASI had recently levelled scathing criticisms of ineffective economic regulation at the NCAA (regulatory agency). However, that does not infer that NASI is favourably disposed to the arbitrary abrogation of that vital statutory function. The objective of our outrage is to challenge the NCAA to live up to its responsibility of delivering proactive and effective economic regulation that will ensure sustainability of the industry.

Why complicate matters by creating another autonomous unit, when we need to equip and support the NCAA to effectively carry out its safety and economic regulatory functions

The Federal Ministry of aviation (FMA) may have identified critical deficiencies within the department of air transport regulation (DATR) in the current structure of the NCAA. The logical action is to address and mitigate them, by providing the required financial resources, training and support to regain provision of effective economic regulation by the department. The (temporary) absence of accidents is not a guarantee that safety has been attained and assured. Certain key indicators of the financial and economic performance of organisations are precursors that safety will subsequently be compromised if the trend remains unchecked. Early detection and prompt remedial action is vital to successful interventions by the regulator. Case in point, Nigeria Airways, Bellview, ADC, Air Nigeria, etc; the list goes on. This regulatory oversight should be extended to FAAN, NAMA and NIMET and all service providers within the aviation sector. Effective economic regulation is essential to the attainment of safety and performance targets. There is absolutely no merit in creating another unit solely dedicated to the conduct of economic regulation, whilst the structure already exists as a department under the already autonomous NCAA. Unless safety and economic regulation are closely monitored and coordinated, current efforts to reform and revitalise the industry will remain futile. It is imperative that the relevant stakeholders and system managers see reason why all regulatory functions;  both safety and economic should remain in the purview of the autonomous NCAA.

Prudent resource allocation and sensible trade agreements

Another area of major concern is the financial and human requirements with corresponding timelines needed to achieve the policy objectives enumerated in NCAP 2013. It is imperative that we have a clear understanding of the cost of the proposed strategies before we embark on  building castles in the air. Any foreign partnership that does not clearly involve the transfer of skills to Nigerians and the strengthening of our manufacturing base is not in our National interest. The Country urgently needs to develop its physical and social infrastructure. However, more importantly we need to develop the skills that will ensure we are able to independently maintain and enhance these structures without recourse to foreign experts.

Additional issues that will underpin any meaningful and sustainable transformation are:

• A free and fair system of Justice that promotes law, order and protection for the vulnerable.
• A clear evidence of government commitment to stem corruption by entrenching "real" transparency, accountability and probity in all its institutions. 
• The currently acquired freedom of information act must also be backed by commensurate 'whistle blower protection policy' if it is to achieve the desired results.
• The evolution of a professional educational and training systems that will ensure the provision, protection and efficient utilisation of skilled competent manpower.
• An Energy sector that ensures the availability of stable electrical power supply backed by a proactive plan for investment in Eco-friendly and sustainable alternative sources of energy in order to reduce over-dependence on fossil fuels. A clear example is the a huge potential Nigeria has with solar energy.

In conclusion, the aforementioned statements and viewpoints thus presented do not compose an exhaustive analysis of the way forward. The intricacies are either quite obvious or will require little investigation to unearth. The real issue is the will and courage to do what is right and in the national interest of our nation; Nigeria. Paraphrasing a quote credited to Martin Luther King Jnr ,“cowardice asks, is it expedient?  Expedience asks, is it politically correct? Vanity asks, is it popular? But conscience asks, is it right?
Now is the time when we must take a position that is neither self centred, politically correct nor popular, but because it is right the thing to do.

Policy, strategy and the role of the human element in the safety and sustainability chain.

Industry deficient in skilled and experienced man-power due to
Neglect of training and manpower development

According to the World Bank African economic Outlook Nigeria Nigeria experienced steady GDP growth from 2010 to 2012; (average 6.5%). Yet our unemployment rate is on the increase now standing at 23.9% compared to 21.1% in 2010.  Meaning we have 33.7 million people unemployed out of a population of 162 million.  what quality of Human resource can reproduce with such a high level of illiteracy? GDP growth average of 6.5% within those 2 years we've still been able to create 4.5 million unemployed people; unbelievable!
60% of our population is expected to be below the poverty line and that is surviving on less than $1 a day.  In perspective 97.2 million people leave on approximately N4800 a  month. It shows that we still suffer very serious inequalities in the distribution of wealth leading to serious socio-economic consequences.

For the past 7 years, a major obstacle in Africa's inability to meet its safety oversight  functions is the lack of requisite competent  manpower. It is obvious that for the past few years a lot of training has taken place within both the administration and professional cadre of aviation agencies. 
However it is hoped that the NCAA will strive to retain these personnel by offering realistic prospects for secure and rewarding professional careers in Nigeria. According to the World Bank tertiary enrolment for developing Countries stands at 10% of the population compared to 56% for Organisation for Economic Co-operation and Development (OECD) Countries. It is evident that Africa will find it challenging to produce the number of development professionals needed to sustain economic growth in the aviation sector without a serious change in educational and labour policies.
Note that a conservative estimate from Boeing last year dictates that Africa needs to provide and additional 715 pilots and 960 aircraft engineers every year for the next 20 years to be able to man it's aviation sector planned capacity. Nigeria's' population is 18% of Africa's hence we are expected to provide the appropriate 18% of the manpower. This comes to precisely 128 additional pilots and 172 new engineers every year. Failing to meet this target means Africa will have to mitigate the shortfall by employing expatriates. These will eventually repatriated both the acquired skills and revenue  back to their home countries to the detriment of this continent.  The problem could have been eliminated if the promised academic upgrade and expansion of the Nigerian College of Aviation technology (NCAT) had been carried out as planned. I carried out a census of ICAO recognised aviation training institutions in Africa. The result showed that the United Kingdom has more ICAO recognised aviation institutions than the 54 African countries combined.


Brain drain caused by security concerns and poor psychological contracts

The current security concerns experienced in some northern parts of the country has result into movement of people  and businesses away from the perceived hot spots. The psychological contract is a series of unwritten expectations that employees expect from their employer and vice versa. The remuneration (pay) is only a tip of the iceberg when it comes to expectation. Principal among these latent expectations are security and safety, training and development, recognition for the work and efforts invested in the organisation. Most employment contracts for aviation professionals make no provision for loss of license insurance, medical cover, pension, union representation and unbiased conflict resolution processes.  The current proliferation of expatriate staff within the Nigerian aviation industry this leads to disparity of conditions and local staff disaffection. A scenario where there is no employee engagement and group synergy provides the perfect environment for the emergence of latent pathogens that will threaten the fragile state of safety the industry is trying to balance against mounting economic and financial pressures.

Lack of enabling laws to provide a safety net for professionals in safety critical organisations.

Aviation professionals in Nigeria are exposed to excessive commercial pressure without any legal protection. These happens because managers insist on meeting target OnTime performance (OTP), schedule integrity,  fraudulent dispatch reliability targets, achieve cost savings, etc. The end result is safety is compromised for economic benefits.This include pilots, engineers, air traffic controllers, dispatchers, handling agents, ground equipment operators, etc.
Some operational safety issues reported include:

Engineers are cajoled into signing certificates of release to service (CRS) when the aircraft is obviously unserviceable.
Dispatchers encouraged to falsify weights in order to carry all commercial payload.
At traffic controllers required to work:

• without required serviceable equipment.

• overtime due to low manpower levels.

Pilots being reprimanded, unilaterally fined by their employers for:

• Safely executing go-arounds from an unstable approach.

• Writing serious defects in the aircraft technical log.

• Refusing to fly an unserviceable aircraft

• Insisting on taking the legal amount of fuel for flights.

All these because of the commercial implication of these required safety measures.

The prebendal culture and the absence of the whistle-blower protection policy

Nigeria needs to evolve a whistle-blower policy that insures protection of both the system and its users. This this will serve to reduce the spread corruption within the system. It would also help in identifying hazards and taking mitigating actions before the entire group is compromised. The absence of this feature has left our aviation system constantly being overrun by corruption. Good people within the system who observe anomalies such as unsafe practices or misuse of public funds are left with the difficult choices. Speaking out and sacrificing their careers and livelihood or keeping quiet and hoping that nothing goes wrong and nobody else finds out. The result is an unsafe system built on false security,  devoid of transparency and accountability that fosters a contagion of corruption and unethical practices.
The inherent prebendal culture leads to depletion of the much needed manpower. It is unfortunate that with every change in Administration the top level management are usually prematurely retired or fired irrespective of the competency and integrity. This unwarranted high turnover of our top professionals deprives the sector of the much-needed manpower required for capacity building. Some of management staff anticipate this cycle and begin looting the system in preparation for undignified exit.

Conclusion:
Nigeria needs a clearly defined and understood transport policy

The entire transport policy for Nigeria needs to be re-written. We need clearly defined policies and their respective strategies with specific objectives and time-lines for safety, reliability, efficiency and sustainability.
We have to be proactive and attempt to address issues at the policy and strategy level. Though the implementation level is very important, it tend is expected to be driven by the policy and strategy. Historical evidence indicate implementation is usually reactive and prone to serious adverse interference due to the absence of a clearly understood policy. The aviation policy should be part of an over-arching transport policy that integrates road, rail, sea and air travel. With a big picture view, our civil aviation policy must reflect elements of the African Civil Aviation Commission (AFCAC) continent-wide programme especially the implementation Yamoussoukro decision (1999) and the drive for regional integration.
It is quite obvious that the implementation of programmes within the sector is not supported by processes to ensure the objective is achieved; checks, balances, transparency and accountability.
A cursory look at the activities of both the regulator NCAA and the Federal Ministry of aviation in the last one year shows a sector without direction, stakeholders buy-in and synergy. A clear indicative of what transpires when a reactive regime attempts to drive a system with cogs already embedded in the wheels; slow, painful and inefficient.

Obviously most of our system managers see policy and strategy as just theoretical postulations and thus have traditionally ignored them. Emphasis is placed on the hurried acquisition of tangible assets and physical structures like airports and air planes. Myopically oblivious that without processes that will ensure sustainable levels of skilled competent man-power and supporting maintenance processes, the infrastructure and equipment will quickly translate into liabilities. The prevalence of corruption in the polity requires that transparency and accountability be clearly defined in policy and strategy. Where classified information is involved, there must still be verifiable checks and balances using a secure structures. One of such is the board of trustees of an aviation advisory council.
 For any policy and strategy to succeed, it is indispensable to obtain stake-holders buy-in and create the synergy required to effect the change.  I believe we are in a transient stage in our national development. To stagnate in its pupa stage, a butterfly larva will not survive for long. So, in the words of Maya Angelou “We delight in the beauty of the butterfly, but rarely admit the changes it has gone through to achieve that beauty."

There's still time for a change, but not long!

You can hardly believe we have 2 months left for the end of 2012! What have you done with the past 10 months? Were you able live a life of quality or better still a fulfilled life?
The essence of quality in life is to be reasonably happy and at peace with God, yourself and humanity as much as possible. For the quality of life is not dependent in the abundance one possesses, but in how much happiness and peace one is able to harness from the accessible resources around us.
A fulfilled life, however is one notch up. It is life that is able to positively impact the lives of others, directly or indirectly even in an infinitesimal measure.
A fulfilled life may mean sharing your resources outside your personal needs, but the results will transcend your lifetime. We hardly remember the richest man during the Church reformation (1510-1525), but many recall Martin Luther the German monk who stood up to challenge the notion that the rich can buy forgiveness from the the Church ( indulgences) , or the non-violent campaigns of Mahatma Gandhi (1893-1947) and Martin Luther King Jnr,(1955-1968) but these icons were not wealthy (in terms of money) but they have impacted lives in ways that billions of dollars can not quantify.  Martin Luther the Monk had the conviction to confront the all-powerful Catholic church (1517) when he was just 34 years old. Mahatma Gandhi founded the Natal Indian Congress (1894) when he was 25 years old. Martin Luther King jnr began to lead the American civil rights movement with the Montgomery bus boycott (1955) when he was 26 years old.  Things don't change when good people do nothing. Change does not necessarily need to be violent. These are three examples among many, where people were able to engender non-violent revolutionary that have changed the world for good.

You can have quality in your present circumstances. You can positively impact others where you are. For there are people who have less resources but are happier and more peaceful than you are. People with less influence and clout are positively influencing more lives around them than you are. That means you also can do it. Dithering (indecisiveness), laziness and procrastination will steal time from you if you let them. And in this life, time is all we have that once lost is never regained. If you're reading this, you still have time! So get up and live! You can do it.

Nigeria Aviation Safety Airspace: Safety of the Nigerian Skies

Nigeria Aviation Safety Airspace: Safety of the Nigerian Skies: The skies have always been safe until we begin tinkering with natures’ balance without adequate safe guards. The result of conflict bet...

Nigeria Aviation Safety Airspace: The current call for a new National carrier is hig...

Nigeria Aviation Safety Airspace: The current call for a new National carrier is hig...: --> It is evidently clear that the Nigerian government,  politicians and bureaucrats do not have the discipline, public confi...

Nigeria aviation: Facing Insolvency.

A snap shot of the commercial/ scheduled airlines in Nigeria's aviation industry, will show that Nigeria has over 16 schedule carriers with a combined fleet of less than 100 commercial jet aeroplanes. Which is rather paltry when compared to Malaysia's Air AsiaX that has just placed an order for 100 Airbus 320 jets. Malaysia also an former British colony like Nigeria, offered independence in 1957 like Nigeria and they were ready; we were not until 3 years later. We offered them palm oil seeds in a mutual transfer of skills programme with International Instituted for Tropical Agriculture (IITA) in the late 70's. Now they are the worlds largest exporter of palm produce and we're not.

 
In the third week of September 2012 Central bank of Nigeria sent a circular banning financial institutions from extending further credit to Nigeria's two major carriers Arik Air and aero contractors. According to them this will prevent these two airlines from further escalating their huge debt profiles by borrowing more money. Perhaps that was a little too late as both airlines are currently burdened with unsustainable loans. This would have been averted easily if the Apex Bank had the foresight to place these airlines under administrative scrutiny as soon as it deployed tax payers money (BASA fund) to refinance bad loans in aviation sector in late 2010. As is done in the USA when organisations that are critical to it's National interest have to be protected from bankruptcy; chapter 11 protection. All the top 10 airlines in America have been shielded from imminent collapse by this facility except Southwest airlines. In the case of Nigeria, it is worth noting that over N100 billion of tax payers money had already been expended in giving all the local airlines a sort of a lifeline. For now the strategy of the CBN  and AMCON appears to be very confusing; you fund and then you stifle. Something is wrong and nobody is telling us what the game plan is. If the airlines are reckless why are they still allowed to run themselves aground with our money? It appears as a deliberate attempt to make sure that the bailout money is wasted and never recovered. Why not takeover their operations and hand them over to someone who has an idea of airline economics and airline operations.


The federal government recently approved  a $1.1 billion loan facility to be burrowed from the Chinese in order to  revamp the transport sector. That was after the  aviation minister had embarked on a road trip costing well over N250 million with initial reports indicating that investors are falling over themselves to come and invest in the Nigerian transport sector. Evidently that was not true, serious investors do not trust our politicians, policy-makers (who mostly make no policies at all)  and our lawless operating environment that makes it almost impossible to implement sensible policies; e.g. privatisation. So rather than risk their own money by investing it directly, they give us a loan; which can be both qualified and quantified and most importantly securitized by the federal government itself in either oil exports or mining rights. We may never know until we see wake up one morning and find a group of Chinese Corporations mining plutonium somewhere in the middle belt.
According to impeccable sources, this is made up of $500 million for the railway reconstruction,  $500 million for the branding and rebuilding of four major International airports and $100 million for the Galaxy backbone infrastructure. The loan is to be repaid after an moratorium of seven years, at an interest of 2.5% over a period of 20 years. Attractive though these may sound, some of us are sceptical considering antecedence of government and borrowing discipline. It brings to mind a fiasco that occurred when the Nigerian government in 1985 took out a loan of $5 billion from the The World bank bank. An appraisal of the Status of the loan in 1997 indicated that though the country had made repayments in excess $10 billion, the loan had mysteriously manage to balloon itself to $35 billion. Most of this was interest as a result of default in repayments.
Are we going to see a replay of such horrors in the clutches of the Paris club of China?

 Disappointed with the current crop of aviation entrepreneurs? leave them to suffer a slow and painful death with the attendant cascading negative effects on passengers, employees and creditors. Just license a new breed of airlines to continue the cycle of failure; after all the re-election jamboree is about to begin where our $200 million a day oil largesse will be put to good use until it runs out in 2053.

About attaining a zero accident rate.....

It's blind faith, crass arrogance, ignorance or a combination of all three, to expect a zero accident in an environment where the institutions, agencies, infrastructure and the requisite workforce to support aviation are constantly  abused and misused. Politics is placed ahead of policy, short term economics before safety. The regulator is struggling to assert it's autonomy, the airlines are grossly mismanaged and placed in perpetual unsustainable indebtedness, the technocrats dont give a toss as long as their pockets are lined, the politicians as long as they're re-elected, the business moguls as long as their spanking new private jet operations are unimpeded. A training institution (NCAT) established over 50 years ago still unable to conduct ATPL certification or commercial jet type rating training (TRTO). The industry with no in-country full service maintenance , repair and overhaul (MRO) facility for commercial operators. Safety information handling is best reactive and practical evidence of a safety culture across the industry does not exist in most organisations. (details for another time). Summary: Implausible!!!
As a starting point: The entire transport policy for Nigeria needs to be re-written. We need clearly defined policies and their respective strategies with specific objectives and time-lines for safety, reliability, efficiency and sustainability.