FG begins ₦18bn Nigeria Airways severance settlement

The Federal Government has begun the payment of ₦18 billion in outstanding severance benefits to 2,700 former workers of Nigeria Airways Limited, more than two decades after the liquidation of the national carrier.

The Federal Ministry of Finance said on Friday that 2,100 former workers in Batches 1 to 7 had already received their entitlements, while payments to another 600 beneficiaries in Batches 8 and 9 were being finalised.

The ministry said the settlement covers nine batches and followed a verification exercise designed to identify eligible beneficiaries, validate their records and determine the financial obligations owed to them.

“The Federal Government has concluded payment of outstanding severance benefits to 2,100 former workers of Nigeria Airways Limited, more than two decades after the national carrier was liquidated,” the ministry said.

It added that the remaining 600 beneficiaries were expected to receive their payments “in a matter of days”, bringing the total number of former workers covered to 2,700 and the total severance settlement to ₦18 billion.

Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the settlement reflected the Federal Government’s commitment to meeting legitimate outstanding obligations and ensuring that approved entitlements reached beneficiaries.

The ministry also acknowledged the roles played by the Minister of Aviation and Aerospace Development, Festus Keyamo, and the National Assembly Joint Committees on Aviation in advancing the settlement.

Mop-up exercise for excluded beneficiaries

The ministry said a second-phase mop-up exercise would be conducted for eligible former workers whose records could not be processed during the first phase.

The exercise is expected to address outdated records, additional biometric verification and corrections to banking details.

It will also cover cases involving deceased beneficiaries, with next of kin or estates required to complete the necessary legal and verification processes.

The mop-up exercise is expected to begin by the end of September or early October, subject to final arrangements.

Director of the Presidential Initiative and Continuous Audit Department, Seldam Dangin, said the exercise was intended to ensure that eligible beneficiaries whose records were not processed in the first phase were not left out.

20-year legacy liability

Nigeria Airways operated from 1958 until its liquidation in 2003, employing thousands of Nigerians across its pilot, engineering, cabin crew, administrative and ground operations.

The liquidation left former workers pursuing outstanding pensions, gratuities and other entitlements for years.

Aviation unions had previously put the number of former workers with outstanding pension and gratuity claims at more than 6,000.

In 2018, aviation unions threatened industrial action over outstanding entitlements reportedly valued at ₦45 billion, after which the Federal Government approved ₦22 billion for partial settlement.

Union records subsequently indicated that about ₦36 billion remained outstanding, while the National Assembly Joint Committee on Aviation renewed pressure for payment in January 2025.

The latest ₦18 billion severance settlement therefore represents another significant step towards resolving liabilities arising from the liquidation of the former national carrier.

The development follows the Federal Government’s approval in July 2025 for the payment of long-standing pensions owed to retired aviation workers, including former Nigeria Airways employees.

New approach to flag carrier

The severance settlement comes as the Federal Government considers a different strategy for developing Nigerian flag carriers following the suspension of the Nigeria Air project.

Managing Director of the Federal Airports Authority of Nigeria (FAAN), Olubunmi Kuku, had indicated that two or three existing Nigerian airlines could potentially receive support to develop into flag carriers.

The proposal differs from the suspended Nigeria Air model, which envisaged Ethiopian Airlines holding a 49 per cent stake, with the Federal Government holding five per cent and other investors controlling the balance.

The Nigeria Air project was suspended after concerns were raised over its structure, with Keyamo announcing its indefinite suspension in May 2024.

The government’s latest approach would therefore seek to build national-carrier capacity around existing Nigerian operators rather than revive the suspended Nigeria Air arrangement.