The Iraqi Finance Minister Taif Sami met with the parliament’s finance committee to discuss several topics concerning the country’s 2024 budget, state media (INA) reported.
“The payment of the salaries of the [Kurdistan] Region’s employees for the current month depends on the submission of the list of names [of the employees],” INA cited Sami as saying, referring to a recent Federal Supreme Court ruling that ordered the KRG to submit a breakdown of the monthly budget for the salaries of the Region’s employees to the federal ministry of finance.
Sami also said the federal finance ministry “stipulated ‘the nationalization’ of the salaries” to pay the KRG in the following months.
For the nationalization of the Kurdistan Region’s employee salaries to happen, the KRG must open accounts for its employees at state-owned banks.
Officials in the Kurdistan Region say that due to bureaucratic hurdles, it will take at least a year to open bank accounts for all the Region’s employees at Iraqi banks, despite it having been set by Sami as a precondition for the federal finance ministry to pay March salaries.
“Creating [bank] accounts and issuing bank cards to employees in the Kurdistan Region is not an easy task and it may take more than a year for all employees to be issued bank cards,” Mohammed Zirari, the general director of the Kurdistan Region’s Board of Auditors told Rudaw’s Zana Kayani on Monday.
Civil servants in the Kurdistan Region still receive their monthly wages in cash. In line with its digitalization campaign, the KRG in October launched of the “My Account” initiative aimed at digitizing the banking sector in the Kurdistan Region. As part of this project, the Region’s employees would see their salaries deposited in their accounts.
Zirari said that since the launch of the initiative, only about 200,000 people have been registered in the system,100,000 of whom have received their bank cards.
The minister’s comments come as a delegation from Iraq’s Federal Board of Supreme Audit is in Erbil to assess the Kurdistan Region’s revenues and expenditures in the second half of last year on Sunday, a spokesperson for the Kurdistan Regional Government’s (KRG) Ministry of Finance Hunar Jamal told Rudaw.
Iraq passed its highly contentious budget bill in June for the years 2023, 2024, and 2025, of which the Kurdistan Region's share is 12.6 percent but Erbil has accused Baghdad of not sending its share on time.
Baghdad has claimed it has fully implemented its financial obligations to the KRG, including through loans to assist the Region in paying the salaries of its civil servants.
In a recent blow to the KRG, Iraq’s top court on Wednesday ruled that the Region’s oil and non-oil revenues must be handed over to Baghdad. In addition, all salaries are to be paid directly by the federal government, rather than Erbil.
The court also mandated the KRG’s finance ministry to submit a breakdown of the monthly budget for the salaries of the Region’s employees to the federal ministry of finance.
The Kurdistan Region’s main source of revenue has been from oil but its exports have been halted for almost a year. According to the budget law, the KRG is obliged to sell 400,000 barrels of crude oil through Iraq’s national oil marketing body, alternatively, Baghdad would use Kurdish oil domestically.
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