Surprise deductions hit Iraqi salaries, pensions

Shafaq News- Baghdad

Iraqi public-sector employees and retirees saw unexpected cuts to their monthly salaries and pensions on Saturday after state banks deducted multiple loan installments at once.

A source explained to our agency that the deductions were linked to outstanding loans and cash advances, but some state-run banks, including Rafidain and Rasheed, recovered two or more installments in a single payment instead of applying standard monthly deductions.

Several affected individuals told Shafaq News, on condition of anonymity, that the reduced payments disrupted household finances, prompting demands for an urgent investigation by parliament and oversight bodies.

Authorities, including the National Pensions Authority and the banks involved, have yet to issue an official explanation.

The salary shock comes as broader disruptions continue to strain state finances, such as decisions to raise customs tariffs on certain luxury goods, triggering protests and causing a buildup of cargo containers at border crossings and ports. The resulting slowdown in trade has weighed on public revenues, which economic experts say was among the factors contributing to delays in paying state employee salaries for January.

Read more: Iraq’s budget paralysis: How the 1/12 rule reduced state finances to salary payments