Iraq’s top officials discuss Kurdistan salary crisis, regional tensions

ERBIL, Kurdistan Region – Iraq’s top leaders convened on Sunday to discuss the ongoing suspension of public sector salaries in the Kurdistan Region, alongside regional developments, particularly the escalating Israel-Iran conflict, according to a statement from the speaker’s office.

President Abdul Latif Rashid, Prime Minister Mohammed Shia’ al-Sudani, and Parliament Speaker Mahmoud al-Mashhadani met at Baghdad Palace, joined by the head of Iraq’s Supreme Judicial Council, Faiq Zidan.

The top officials reviewed the steps taken by the federal government to ensure the Region’s salaries are disbursed in a "regular and fair" manner, consistent with constitutional and legal obligations.

Tensions between Erbil and Baghdad intensified in late May when the federal finance ministry halted all budget transfers to the Kurdistan Regional Government (KRG), including salaries for over 1.2 million public sector employees. The ministry said the move was due to the Region exceeding its allocated 12.67 percent share of the 2025 federal budget.

The decision has sparked strong backlash from Kurdish political parties, who argue the suspension is politically motivated and unconstitutional.

On Wednesday, Kurdistan Region Prime Minister Masrour Barzani submitted a formal letter to Iraq’s highest judicial authority regarding the salary crisis.

In a statement, the KRG quoted PM Barzani as saying, “We have sent a letter to the Federal [Supreme] Court regarding the illegality and unconstitutionality of the decision by the federal finance ministry to suspend the salary [disbursements] and financial entitlements of the Kurdistan Region.”

The Region premier further expressed hope that the court would rule in favor of the people of Kurdistan, stressing that the KRG has fulfilled all of its constitutional obligations and that its rights and financial entitlements must be upheld.

Earlier in June, the Federal Supreme Court confirmed it had registered a lawsuit filed by Kurdistan Region public servants, seeking an injunction to compel the federal government in Baghdad to resume salary payments. The court has yet to set a date for deliberation.

Sunday’s meeting also addressed regional security concerns. The officials discussed the ramifications of the recent "aggression" against Iran and Israel’s repeated violations of Iraqi airspace. They emphasized the need to safeguard Iraq’s sovereignty and take appropriate legal and diplomatic measures in response.

Regional tensions have surged since June 13, when Israel launched strikes on Iranian nuclear facilities, killing several senior military officials and triggering retaliatory attacks from Tehran. Iran responded with multiple waves of missile and drone strikes targeting Israeli territory.

In a significant escalation on Sunday, the United States carried out airstrikes on Iran’s primary nuclear sites - Fordow, Natanz, and Isfahan. Iranian Foreign Minister Abbas Araghchi condemned the strikes as “outrageous,” warning on X that Tehran “reserves all options to defend itself,” and that the attacks “will have everlasting consequences.”

Earlier this month, Iraq filed an official complaint with the United Nations Security Council, accusing Israel of violating Iraqi airspace during its attacks on Iran, according to state media reports.

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