Monitor

Iraqi finance ministry rejects statement by deputy finance minister on Kurdistan Region salary delays

BAGHDAD — The Iraqi Ministry of Finance has dismissed statements made by Deputy Finance Minister Rebaz Hamlan regarding salary delays in the Kurdistan Region, labeling his remarks as “inaccurate.”

The ministry’s statement followed a meeting between Deputy Finance Minister Hamlan and Prime Minister Mohammed Shia Al-Sudani on Tuesday. During their discussion, Hamlan addressed Iraq’s financial challenges in 2025, specifically focusing on the Kurdistan Region’s salary issues.

Hamlan conveyed a message from Kurdistan Regional Government Prime Minister Masrour Barzani, which was discussed during the KRG’s extraordinary cabinet meeting on Jan. 11. At the meeting, Barzani stated, “Kurdistan people must be freed from this psychologically distressing situation. The relationship between the Kurdistan Region and Iraq must be rectified. We are demanding our constitutional rights from Baghdad. The people of Kurdistan do not deserve this oppression and injustice being perpetrated against them.”

During the meeting, Hamlan also highlighted the ongoing efforts of the KRG and the Ministry of Finance, in collaboration with federal finance officials, to resolve the salary delays. He emphasized that the region’s demands are within the constitutional framework, necessitating the implementation of the Budget Law and Federal Court rulings.

A subsequent meeting between KRG and federal finance officials is scheduled for Friday in Baghdad, led by Deputy Prime Minister and Foreign Minister Fuad Hussein, to further address the financial issues affecting the region.

As of January 2025, public sector employees in Iraq’s Kurdistan Region are still awaiting their December 2024 salaries. The Kurdistan Regional Government attributes the delays to insufficient budget allocations from the federal government in Baghdad.

Full statement by Ministry of Finance:

The Ministry of Finance clarifies that the statement by Mr. Rebaz Hamlan, deputy minister of finance, is inaccurate. This response comes in reaction to his personal page’s posts regarding delays in salary disbursements for the Kurdistan Region.

The Ministry of Finance informs the public that we handle the issue of salaries for regional employees with full professionalism, in the same manner applied to federal ministries and governorates. These procedures are also followed for the Kurdistan Region.

We reiterate and confirm that the Ministry of Finance has no connection to the delay. This is because we have sought to implement the Federal Court’s decision for over a year, while the Kurdistan Region has yet to provide the Ministry with any data related to the localization of employee salaries in all banks (not just government banks), per the Federal Court’s ruling. This ruling treats Kurdistan Region employees equally with federal employees, a principle the Ministry of Finance has adhered to.

The delay stems from the Region’s failure to separate the names of employees referred for retirement. To resolve this, the Federal Ministry of Finance dispatched a team over ten days ago, including experts from accounting, budgeting, and retirement departments. They are working with the Region to audit lists, isolate retirees, calculate pensions under Retirement Law No. 26 of 2019 (amending Law No. 9 of 2014), process the recent 100,000 dinar increase for retirees, finalize end-of-service benefits, and distinguish between old retirees and those covered by the new law. Workshops are being held to address these issues for over 29,000 employees slated for retirement, as stated by the Region’s representatives during their latest visit to Baghdad.

Additionally, the Peshmerga forces—a subset of the federal ground forces—are being addressed. The Region has been paying their salaries from its budget, causing a deficit. These personnel should instead receive salaries from the Federal Ministry of Defense, as their allocations and personnel records have been under the federal defense budget for over two years.

The Region must also disclose individuals receiving multiple salaries and provide copies of its relevant laws to avoid monthly discrepancies during payroll audits.

Direct salary deposit (localization) is essential to implement the Federal Court’s decision, replacing paper-based lists to ensure timely monthly payments—a constitutional right for all employees. The Federal Ministry of Finance has repeatedly clarified that delays are not due to its actions but the Region’s non-compliance.

The December 2024 monthly audit balance remains incomplete due to input errors by the Region. Federal accounting staff are collaborating with the Region’s representatives to correct these, as funding for any month requires submitting the prior month’s audit balance. This is necessary to finalize the state’s closing accounts and submit them to the Parliamentary Finance Committee, the General Secretariat of the Council of Ministers, and the Federal Audit Bureau, per Article 6 of the 2019 Amended Financial Management Law.

The Ministry confirms it continues to disburse federal employee salaries for January 2025, as the month has not yet concluded.