The Council of Ministers rejects any amendments to the draft budget which violate the agreement between Erbil and Baghdad

Prime Minister Masrour Barzani of the Kurdistan Regional Government (KRG) presided over a meeting of the Council of Ministers on May 24, with Deputy Prime Minister Qubad Talabani in attendance.

The meeting focused on the latest developments regarding Iraq's federal budget bill for 2023, 2024, and 2025. Discussions focussed on sections of the bill concerning the financial entitlements of the Kurdistan Region. Changes made to certain articles of the budget, particularly Article 12, were also deliberated.

During the meeting, the council acknowledged the efforts of certain members of the Finance Committee in the Iraqi House of Representatives who attempted to amend articles 13 and 14. These proposed amendments, if passed, would have infringed upon the rights and entitlements of the Kurdistan Region. It should be noted that these rights had previously been agreed upon and approved by both the Council of Ministers of the Kurdistan Regional Government and the Federal Government of Iraq on April 4, 2023.

The Prime Minister provided the Council with an update on the recent negotiations between the Kurdistan Regional Government and the Federal Government of Iraq. These negotiations led to an agreement in April that is beneficial to both sides and is in line with the constitution. The Prime Minister called for the prompt approval of the budget law and urged the central government to respect the financial entitlements of the Kurdistan Region. He emphasised the importance of refraining from making any changes or amendments to the draft budget law or the mutual agreement between Erbil and Baghdad.

The Prime Minister stressed that the Kurdistan Region has fulfilled all its obligations, and therefore, the federal government must fulfil its duty by providing the entitled financial support to the Kurdistan Region, just as it does for the rest of Iraq.

The Council of Ministers urged the negotiating team to maintain communication and coordination with the federal government, the Iraqi Council of Ministers, and the Kurdish factions in the Iraqi Parliament. This is to prevent any attempts to infringe upon the rights and entitlements of the Kurdistan Region, which have been approved in accordance with the Iraqi constitution and reflected in the agreement between Erbil and Baghdad.

Regarding the financial entitlements of the Kurdistan Region in the first five months of 2023, the Council of Ministers approved the proposal put forth by Dr. Amanj Rahim, the Secretary of the Council of Ministers. This proposal involves sending a letter to the Iraqi Council of Ministers, requesting compliance with Article 13 of the Financial Management Law of 2019. The letter suggests remitting a twelfth of the KRG's audited practical expenditures from the financial year 2022, as conducted by both the Financial Oversight Bureaus of Erbil and Baghdad. This mechanism aligns with how expenditures of other Iraqi provinces are handled. The Council emphasised the importance of ensuring equality between the Kurdistan Region and other regions of Iraq, thereby reaffirming the readiness of the Kurdistan Regional Government to fulfil all obligations outlined in the Financial Management Law.

The second part of the meeting centred around identifying appropriate mechanisms to implement the decision made during the previous Council of Ministers meeting concerning the restructuring of public finances in the Kurdistan Region.

Following a productive discussion, the Council of Ministers unanimously approved all provisions of the public finance restructuring. Both the Prime Minister and his deputy emphasised that the restructuring aims to centralise revenues, expenditures, and salaries throughout the Kurdistan Region, with a focus on treating the salaries of the public sector as a priority. They also highlighted the importance of equitable revenue distribution based on the region's population.

The Council of Ministers instructed all ministers to develop plans for implementing the provisions of the public finance restructuring. To ensure this, a support board was established to address any obstacles that may arise.

Furthermore, the draft bill of the Ministry of Health in the Kurdistan Region was presented by Vala Fareed, Minister of State for Parliamentary Affairs. The aim of this bill is to improve the quality of public services and the health institutions in the region. The Council requested the Ministry of Health, along with its directorates and departments across the region to enrich the draft bill with their inputs.