NCAA Halts ‘No Pay, No Service’ Enforcement as Airlines Battle Rising Costs

The Nigeria Civil Aviation Authority (NCAA) has temporarily suspended its planned enforcement of the controversial “No Pay, No Service” directive earlier introduced against domestic airlines indebted to the regulator over unpaid statutory remittances.

The decision, announced in a statement issued in Abuja on Monday, followed mounting concerns over the worsening financial pressure facing airline operators amid the persistent rise in aviation fuel prices and increasing operational costs across the sector.

The Authority clarified that the suspension should not be interpreted as a cancellation, waiver or forgiveness of the debts owed by the affected airlines, insisting that all operators remain fully responsible for settling their outstanding obligations.

According to the NCAA, structured engagements and consultations would continue with the airlines to facilitate debt recovery while avoiding actions capable of destabilising flight operations and worsening challenges within the aviation industry.

“The temporary suspension of the planned enforcement is intended to support operational stability within the aviation sector while ensuring that all outstanding statutory obligations are eventually recovered,” the Authority stated.

The development comes after President Bola Ahmed Tinubu approved a 30 per cent discount on outstanding charges owed by domestic airlines to aviation agencies, including the NCAA, as part of broader intervention measures aimed at cushioning the effects of soaring Jet A1 fuel prices.

The NCAA further explained that the five per cent Ticket and Cargo Sales Charge (TSC), which forms the basis of many of the outstanding remittances, remains a statutory requirement under the Civil Aviation Act.

The regulator noted that the charge is embedded in the cost of air tickets and cargo services and is collected by airlines on behalf of the aviation sector, stressing that such funds do not constitute airline income or operational profit.

According to the Authority, the remitted funds are distributed among critical aviation agencies responsible for safety regulation, air navigation services, airport operations, inspections and compliance monitoring within Nigeria’s aviation ecosystem.

The NCAA also emphasised that it operates largely on a cost-recovery basis and does not depend on direct federal government funding for its routine oversight responsibilities.

Industry stakeholders have repeatedly warned that many domestic airlines are currently under severe financial strain caused by exchange rate volatility, rising maintenance costs, fleet shortages, insurance expenses and the sustained increase in aviation fuel prices.

The regulator maintained that while enforcement has been suspended for now, airlines are expected to comply with agreed repayment structures as discussions continue.