KRG sparring with federal finance minister
My Account initiative at heart of salary disputes
ERBIL — In recent meetings, the Finance Committee of the Iraqi Parliament and the Federal Finance Minister in Baghdad, alongside the Kurdistan Regional Government in Erbil, discussed the My Account banking initiative.
The KRG’s Council of Ministers endorsed My Account, describing it as a significant banking project, superior to Iraq’s nationalization efforts in terms of cost-efficiency and service quality, under the Central Bank of Iraq’s supervision. This initiative is set to streamline salary disbursements for regional employees through the KRG’s Ministry of Finance, offering access to a range of banking services, including transactions and loan facilities.
The initiative promises that by year-end, all regional employees will have active bank accounts. These banks, approved by the Central Bank of Iraq, align with Iraq’s wider nationalization strategy.
Awat Sheikh Janab, KRG’s Finance Minister, reported that despite requesting nearly 950 billion Iraqi dinars for February 2024 salaries, the Federal Ministry of Finance provided just over 569 billion dinars, fulfilling only 59% of the needed amount and highlighting a funding gap for the month’s salary payments. Federal Finance Minister Taif Sami says the rest will be disbursed upon receipt of full payroll information of Kurdistan Region security forces.
While the KRG’s Council of Ministers convened in Erbil, the Finance Committee and Taif Sami were engaged in parallel discussions in Baghdad. Rejecting the KRG’s My Account initiative, they explored an alternative proposal from a company promising to issue bank cards to all regional employees within 15 days, as reported by Narmin Ma’ruf, deputy chair of the finance committee, to 964media.
Jamal Kocher, another member of the committee, disclosed at a press conference that Qi Card had proposed digitizing the salaries for the entire Kurdistan Region’s workforce. He relayed a firm stance from Taif Sami: “Salaries for Kurdistan Region employees will be withheld in March unless processed through the federal banking system, in line with the nationalization process. Without compliance, not a dinar will be dispatched to the Kurdistan Regional Government. All data concerning Kurdistan region security forces must be submitted for review, akin to other ministries, before their salaries can be released.”
Launched by the KRG in February last year, the My Account initiative aims to include all public sector workers and retirees in a comprehensive digital banking rollout.
KRG reports show that over 240,000 bank accounts have been established for government staff, with upwards of 120,000 bank cards issued to those enrolled. The initiative, which now encompasses banks such as BBAC, Cihan, NBI, RT, and recently the Iraqi Islamic Bank (IIB), is set to integrate major banks by the month’s end.
Jamal Kocher queried the Finance Minister on the My Account project’s progress in the Kurdistan Region, particularly on the collection of employee data and the reasons for not disbursing salaries through this system. Sami said in response: “The decision of the Federal Supreme Court mentioned government banks, and therefore, it must be government banks that undertake this task.”
Last month, the Federal Court of Iraq ruled that Kurdistan Region salaries must be paid directly by Baghdad rather than the KRG itself.
The KRG’s Council of Ministers commended the Ministry of Finance and Economy and the budget negotiation team for their diligence, emphasizing that the Federal Ministry of Finance’s actions should not deprive Kurdistan Regional Government employees of their salaries.
The council emphasized, “the constitutional and legal right of these employees to be treated equally with their counterparts in other regions of Iraq, ensuring full disbursement of their salaries without discrimination due to intergovernmental disputes.”
Furthermore, the Council of Ministers highlighted, “allowing Kurdish region employees to choose and open bank accounts freely within the framework of the My Account project.”
Protesting teachers in the Kurdistan Region have issued a stark warning in a recent statement, suggesting “any further delays in salary payments could lead to widespread civil protest.”
This past Wednesday, they expressed a clear demand: the Kurdistan Regional Government should not interfere with the Federal Supreme Court’s decisions and firmly opposed the use of the My Account system for receiving their salaries.
The Protesting Teacher’s Committee has urged the government to directly provide the Federal Ministry of Finance with the list of salary recipients, advocating for payments through either Rashid or Rafidain banks, among Iraq’s leading financial institutions.
Ali Rauf Mustafa, speaking for the teachers, conveyed to 964media, “There are no plans to start protests at this stage,” suggesting a cautious approach to future actions.
On March 3, teachers in Sulaymaniyah demonstrated against the KRG’s My Account project, calling for their salaries to be handled through Iraqi banks.
A similar protest occurred in Halabja, with educators and civil servants rallying in support of the Federal Court’s decisions on salary payments.
Zanyar Ali, a Halabja teacher and protest organizer, shared with 964media, “The purpose of our protest is to expedite the distribution of salaries. We reject the My Account system and demand that our salaries be directly distributed from Baghdad. We also support the decisions made by the Federal Court in this regard.”