Iraq Prepares Bill to Establish Salary Stability Fund
At a Glance
- Iraq’s Parliamentary Finance Committee has prepared a draft law to establish a fund aimed at guaranteeing employee salaries.
- The proposed fund would receive 10% of annual surplus oil revenues.
- The fund would also generate resources through investments, donations, and loans.
- Government approval is required before the financially related bill can move forward.
Iraq’s Parliament is preparing legislation aimed at ensuring employee salaries remain available during periods of budget deficits or financial pressure.
Key Statements and Focus Area
- Government Approval: Since the project includes a financial aspect, government approval is necessary to ensure the draft is consistent with Federal Court rulings concerning legislation with financial consequences. — Uday Awad, Head of the Parliamentary Finance Committee.
- Fund Management: The proposed fund would be overseen by representatives of the Ministries of Finance and Planning, the Central Bank, the Integrity Commission, and an independent economic expert.
The Parliamentary Finance Committee prepared the draft under Article 60 of the Iraqi Constitution. The proposed legislation would establish a dedicated “Salary Stability Fund” tasked with providing employees’ financial entitlements when the state budget faces deficits or other financial difficulties.
The fund would be directly linked to the Council of Ministers, with the proposed structure intended to support the timely distribution of salaries.
Under the draft, 10% of annual surplus oil revenues would be allocated to the fund. Its resources would also include profits generated through investment of the fund’s assets, along with domestic and foreign donations and loans.
The proposed management structure would bring together representatives from several federal institutions. The Ministries of Finance and Planning, the Central Bank, and the Integrity Commission would each have representation, alongside an independent economic expert.
The committee said the structure is intended to provide oversight over the fund and how its revenues are managed and used when financial resources are needed.
FYI
Iraq’s public finances remain heavily dependent on oil revenues, making government spending vulnerable to fluctuations in oil income and broader fiscal pressures. Employee salaries represent a major recurring expenditure in the federal budget, making the availability of reliable funding important for maintaining regular payments.
The proposed fund is designed as a financial reserve that could be used when budgetary resources are insufficient, with surplus oil revenues serving as its main planned source of funding.
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