Kurdistan Region pension payments resume after delay, now aligned with Iraq’s federal system

NEWSROOM — After more than 60 days of delayed salary and pension payments due to disputes between the Kurdistan Regional Government and the Federal Government of Iraq, payments have finally resumed.

Pensioners in the Kurdistan Region will, for the first time, receive pension payments equal to those of their counterparts in Iraq’s federal system, resulting in a significant increase in payouts.

The Ministry of Finance and Economy of the Kurdistan Regional Government announced yesterday that “the July salaries for Kurdistan Region pensioners will be distributed in accordance with the Unified Retirement Law and will be aligned with those in Iraq.”

This decision follows a Nov. 22, 2022, ruling by the Federal Supreme Court of Iraq, which required the KRG to implement Iraq’s Unified Retirement Law No. 9 of 2014. Initially, the KRG had disregarded this ruling and continued to operate under the outdated Iraqi Pension Law No. 27 of 2006, which set the minimum pension in the Kurdistan Region at 220,000 dinars (approximately $168).

However, in July 2024, the KRG agreed to comply with the court’s directive to align its pension system with that of Iraq. Under the new law, the minimum pension will increase to 500,000 dinars (approximately $382), with an additional 100,000 dinars (approximately $76) added for a period previously determined by the Iraqi Council of Ministers.

The Kurdistan Region is home to around 230,000 pensioners, including 160,000 civilian retirees and 70,000 military retirees. Of these, 80,000 currently receive a pension of 220,000 dinars, which will now be increased to 500,000 dinars. The remaining pensioners, who receive amounts ranging from 500,000 to 1 million dinars (approximately $382 to $764), will also see an additional 100,000 dinars added to their monthly payments.

Fatimah Mohammed, a 64-year-old pensioner from Halabja, expressed her relief to 964media, stating, “The increase from 220,000 to 600,000 Iraqi dinars will help ease some of our burdens, as we have been receiving very low pensions in recent years.”

Jamila Sabir, who has spent 43 years in the education sector as a teacher, school administrator, and education supervisor, also welcomed the increase but noted, “My years of service deserve a better pension. What I currently receive barely covers my essential needs and does not take into account my health issues.”

There are still several challenges with how pensioners receive their payments. The current system is outdated and cumbersome, requiring them to visit a limited number of banks across various cities. In some towns, there is only a single bank available, forcing pensioners to endure long queues, often outside in extreme weather—whether intense summer heat or harsh winter conditions. Given their advanced age and often poor health, many face significant difficulties.

Sadiq Osman, spokesperson for the Kurdistan Region Pensioners’ Union, expressed his gratitude during a press conference Tuesday, following the announcement of the equalized pension payments. He paid tribute to the pensioners who lost their lives while waiting to receive their payments outside banks.

On Aug. 14, 2022, an elderly retiree died while waiting in line to receive his salary in Erbil, and two more retirees passed away in similar circumstances in March of that year in Sulaymaniyah.

“Today, you can feel relieved and content because your pensions are being increased,” Osman said.

He also expressed his appreciation to all parties that have supported the implementation of Iraq’s Unified Retirement Law, an effort that has been ongoing for the past 11 years.

KRG Pensioners to Receive Higher Payments on Par with Iraqi Counterparts for the First Time (Photo: 964media)

The KRG is attempting to address this issue through “My Account,” its flagship financial inclusion initiative aimed at digitalizing the salary distribution process for over one million public sector employees. Launched in September 2023, the initiative aims to ensure that all public sector employees in the Kurdistan Region have active bank accounts by the end of the year. According to the official website, “My Account is an ambitious program by the Kurdistan Regional Government to modernize and streamline how public beneficiaries receive their payrolls and save money.”

However, many residents in the Kurdistan Region remain skeptical about the viability of this scheme, particularly given the ongoing economic crisis and extended periods without salary payments. Several protests have occurred in the Sulaymaniyah and Halabja governorates, with demonstrators demanding that their salaries be managed via Baghdad instead of the new Kurdistan Region system.

The implementation of the Unified Retirement Law No. 9 of 2014 will also standardize the official retirement age at 60 years. Additionally, employees who reach the age of 45 and have completed 15 years of service will be eligible for voluntary retirement.

On July 3, the KRG clarified that all pensioners in the Kurdistan Region will now retire under a unified legal framework with consistent terms and conditions. A new entity, the National Retirement Department, will be established to oversee retirements for civil servants, military personnel, Peshmerga fighters, and internal security forces, replacing the previous system where each category was governed by separate retirement laws under the 2006 legislation.