ERBIL, Kurdistan Region – The Kurdistan Region parliament has passed a major bill that commits the government to undertake radical reforms to the payroll system and pension fund.
"Today we are delighted to announce that the reform bill has been approved by the Kurdistan parliament," Jaafar Imniki, deputy parliament speaker said at a press conference late on Tuesday night, attended by other parliament officials as well as Finance Minister Rebaz Hamlan.
Hamlan said the bill is needed to “fight injustice,” and welcomed the two weeks of intense talks it spurred between the government and parliament.
The bill will cancel out double salaries and ghost employees, and lower special promotions given to people who were elevated in retirement to the status of ministers, deputy ministers, or general directories without ever holding such posts, Hamlan detailed.
"A special status has been set for the honourable relatives of the martyrs, political prisoners, and people with disabilities," Hamlan said, explaining that such people can receive two salaries if they are public employees. But he warned that these beneficiaries will be "heavily audited" to differentiate "worthy" people from those who are not.
Dr Izzat Sabir, head of the finances committee of the parliament, praised the bill as "good news" for the people of the Kurdistan Region.
"There are people who will lose out [because of the bill] – they are the corrupt," Sabir said, adding that they expect some people will fight the measures because it affects their unlawful salaries.
The government now has 90 days to implement the reforms, the first major overhaul of the public servant sector since the foundation of the Kurdistan Regional Government.
KRG reveals plans for radical reforms to salary system
Under the reforms, the minimum pension will be set at 300,000 Iraqi dinars ($253) and pensions of high-earners will be decreased, according to Sabir.
The parliament also committed the government to will open two bank accounts for state employees, Omed Khoshnaw, head of the parliamentary group of the ruling Kurdistan Democratic Party (KDP), told reporters Tuesday evening.
One of the bank accounts will be for funds cut from employee salaries under austerity measures since 2016. Employees will not be able to withdraw from this account, but can use the money to pay loans and bills, the MP explained.
Under the salary-saving system, state employees saw their pay cheques cut by as much as 40 percent – a move that sparked a series of protests.
The second bank account will receive the actual salary that employees can withdraw in cash, monthly.
The parliament has passed a number of articles of the 23-article reforms bill that should reduce the financial burden of the Region.
Articles 9, 10, and 11 were approved on Tuesday.
Article 9 pertains to reorganizing the Pershmerga’s multiple accounting divisions into a single unit under the auspices of the Ministry of Peshmerga Affairs.
The parliament could not agree on one section of the Article, pertaining to the number of guards for officials, and party and governmental headquarters. It has been returned to the government to develop a mechanism to set the number of guards for officials and entities.
The aim is to decrease the disproportional number of guards and ghost employees on the books of some officials who are accused of pocketing the funds for non-existent guards.
The guards will be organized under the Ministry of Interior, according to the bill.
Sections of Article 10 providing extra funds for worthy employees were passed. Extra funds are in addition to the base salary and are given to cover factors like transportation costs and danger pay.
Article 11 is concerned with years of service. The base salary of the military and internal security forces will be determined based on education degree and actual years of service.
Second salaries will remain available for relatives or survivors of events related to the Kurdish struggle, like the genocidal Anfal campaign and chemical attacks, if they are public employees, Khoshnaw said.
The parliament last Wednesday approved a controversial article that concerns the fate of pensioners with "special ranks" – people who were promoted to higher salaries in their retirement. Pensions will now be based on their qualifications, years of service, and age, among other criteria.
Under the proposed amendments, the KRG could save about a quarter of its current salary costs, 100 – 120 billion dinars ($85-100 million).
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