Exclusive: Kurdistan Region’s non-oil revenues can’t cover employee salaries

Shafaq News/ The Kurdistan Regional Government (KRG) requires one trillion Iraqi dinars per month ($762.861 million) to pay salaries for its employees and retirees, an Iraqi MP revealed on Tuesday.

The member of the Iraqi Parliament's Finance Committee, Nermin Maarouf told Shafaq News, “After the Paris Court's decision to halt oil exports, the region now relies solely on non-oil revenues to fund its investment projects and cover operational expenses for its internal institutions.”

“If not for the Federal Supreme Court’s ruling requiring the federal government to pay salaries for employees and retirees in the region, the KRG would have had to fund these salaries from its limited revenues,” the Iraqi MP explained.

She referred to Article 121 of the constitution, which stipulates a fair share of federal revenues for all provinces, adding that the Financial Management Law, particularly Article 29, obligates the KRG and provinces to remit part of their local revenues, including taxes and customs, to the federal treasury.

According to the Federal Board of Supreme Audit, the KRG's non-oil revenues amounted to around 4 trillion dinars, while Iraq’s total non-oil revenues did not exceed 12 trillion dinars.

Regarding the amount received from the federal government, Maarouf revealed, “The KRG received less than 11 trillion dinars of employee and retiree salaries,” pointing out that salaries for December had not been paid yet.

On Tuesday, The Financial Committee in the Iraqi Parliament decided to form a special committee to follow up on the financial entitlements of the Kurdistan Region for the years 2024 and 2025.

According to a letter signed by the head of the Parliamentary Finance Committee, Atwan Al-Atwani, dated January 11, the committee will be led by his first deputy, Ahmed Muthar Al-Jubouri.

The salary issue in the Kurdistan Region has remained unresolved for years due to ongoing disputes with the federal government. Each year, the matter resurfaces during the approval of the federal budget, which ties the Region’s share to conditions, particularly the transfer of oil revenues. Over the past two years, following the suspension of the Region's oil exports through the Turkish port of Ceyhan, the federal government has been providing salaries as loans.

In February, the Federal Supreme Court directed Baghdad to pay the salaries of the Kurdistan Region’s employees directly, by passing the Kurdistan Regional Government, after months of salary delays.

In Parliament, the Iraqi PM emphasized that the salary issue is not political but noted that the Kurdistan Region has failed to meet any of the clauses in the Budget Law. He further stated that no additional transfers would be made for the Region’s salaries and confirmed that only 760 billion dinars (approximately 608 million USD) would be disbursed, corresponding to the Region’s fixed share of 12.67%.