KRG-Baghdad public sector salary dispute escalates as Eid Al-Adha approaches

ERBIL — Tensions between the Kurdistan Regional Government and the federal government in Baghdad escalated this week after Iraq’s Ministry of Finance ordered a halt to salary payments to the Kurdistan Region, drawing strong backlash from Kurdish political leaders ahead of Eid Al-Adha.

On Wednesday, the federal Finance Ministry informed the KRG that it would suspend salary transfers beginning in May, citing the Kurdistan Region’s failure to submit verified records of its oil and non-oil revenues. The ministry also claimed the KRG has exceeded its allocated share of the 2025 federal budget by more than 19 trillion dinars as of April.

In a formal letter seen by 964media, KRG Finance Minister Awat Janab Nuri rejected the accusations, calling Baghdad’s interpretation of the budget law “legally flawed and politically motivated.” Nuri said the move violates Iraq’s constitutional guarantees of equality and dignity, citing Articles 14 and 37. He also said the disputed funds had been deposited into the Central Bank of Iraq and that the KRG had met its revenue-sharing obligations.

The decision has sparked a wave of political condemnation in the Kurdistan Region.

Since 2014, the Kurdistan Region’s public sector—which employs over 1.2 million people and dominates the local economy—has faced chronic salary delays due to ongoing disputes with Baghdad over oil revenues and budget allocations.

The Kurdistan Democratic Party warned Thursday that it would adopt a “serious position” if the funds were not released before Eid Al-Adha. In a statement, the party’s political bureau called the finance ministry’s decision “unconstitutional” and accused Baghdad of “politicizing people’s livelihoods.” The issue is expected to be discussed at the KDP’s central committee meeting on June 2.

Eid Al-Adha is already a financially demanding time for families, even when salaries are paid on schedule, as it involves purchasing sacrificial animals, new clothes, and preparing large meals — all of which place added strain on household budgets.

Kurdish blocs in Iraq’s Parliament also issued a joint statement denouncing the suspension, describing it as “collective punishment” that is pushing public sector employees in the Kurdistan Region into hardship. The lawmakers called on Prime Minister Mohammed Shia al-Sudani to intervene, warning against linking citizens’ constitutional rights to political or administrative disputes.

“Salary is not a favor but a legal and constitutional right,” the statement read. The MPs also urged the President of the Republic and Kurdish ministers in the federal Cabinet to publicly clarify their positions on the matter.

Leaders in Erbil are calling for a long-term resolution to the salary issue, warning that continued delays could lead to serious political fallout and further erode trust between the Region and Baghdad.