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Facing financial pressure, KRG must rely on internal revenue to pay salaries

PM:07:04:28/07/2021

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SULAIMANI — The Kurdistan Regional Government (KRG) hinted on Wednesday (July 28) that public sector salaries could be cut again in the future if budget tensions with Baghdad continue.

Following a meeting of the KRG Council of Ministers, spokesperson Jotiyar Adil said that the leadership in Erbil viewed providing salaries for public sector workers as the government’s "priority,” but that delays in implementing the federal budget were causing financial pressure.

"We will try to continue the disbursement of salaries in full by organizing internal income,” Adil said, referring to money obtained by the KRG from taxation, customs duties, and fees rather than cash transfers from Baghdad.

Last year, KRG Prime Minister Masrour Barzani said that the KRG had more than $30 billion in debt and obligations and no savings.

In the face of low oil prices, budget disagreements, and the coronavirus pandemic, Barzani’s government decided to cut public sector salaries by nearly a quarter, only resuming full payments this month after Baghdad sent a 200 billion Iraqi dinar ($137 million) stipend.

The stipend was sent as a side deal with Iraqi Prime Minister Mustafa al-Kadhimi and is not the Region’s budget share, so it is only represents a short-term solution.

During its weekly meeting, the Council of Ministers also discussed the looming problem of supplying residents with enough heating oil for the winter, which has been a persistent challenge in recent years.

The cabinet also decided to elevate the status of Duhok governorate’s Zakho district and Erbil governorate’s Soran district to independent administrations, similar to the Raparin and Garmian administrations in Sulaimani governorate.

(NRT Digital Media)