Azad, who represents the Patriotic Union of Kurdistan (PUK), told NRT in an interview that a combination of oil exports, which he said have reached 450,000 barrels per day (bpd), the devaluation of the Iraqi dinar, cash assistance from the International Coalition, and income from customs fees and taxes were enough to begin distributing salaries, albeit with a twenty-one percent cut.
Because of low oil prices, the Covid-19 pandemic, and a budget disagreement with the federal government that saw cash transfers from Baghdad stop in April, the KRG struggled to pay its public servants this year, deciding to skip entirely five monthly salary disbursements this year.
Salary payments in two months were paid with twenty-one percent cuts and two others with eighteen percent cuts.
Public servants received their full paychecks just three times during 2020.
The government’s failure to pay its workers shook that faith and contributed to a serious decline in economic conditions in the Region.
Erbil has sought economic relief from Baghdad, sending delegations to broker agreements to resume the cash transfers, with only limited success.
KRG Deputy Prime Minister Qubad Talabani and a negotiating team visited the Iraqi capital during December, returning to Erbil with news of a deal that reportedly secured financial resources for the Region as a part of the 2021 Federal Budget Law.
Remarks from other lawmakers and figures, including Kurdistan President Nechirvan Barzani, suggest that there are issues that remain unaddressed that could upset the apple cart when the Council of Representatives convenes this month to take up the budget.
The Kurdistan Parliament has not passed a budget since 2013 so the financial details of government operations are opaque and corruption is rampant, making claims about the financial capacity of the KRG mostly unverifiable.
Protests in all four of the Kurdistan Region’s governorates since the summer about unemployment, poor public services, and rising poverty incentivize politicians, particularly those outside of the Kurdistan Democratic Party (KDP), to claim that the government can pay salaries despite the circumstances.
Azad’s PUK is a member of the government, along with the KDP and the Change Movement (Gorran), and has participated in the decision-making that led to the skipped and cut salary disbursements.
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