The Federal Court rejects a lawsuit against sending 700 billion dinars to the Kurdistan Region

The Federal Court rejects a lawsuit against sending 700 billion dinars to the Kurdistan Region

Amanj Rahim, the Secretary of the Kurdistan Regional Council of Ministers, announced on Thursday that the Federal Supreme Court, which is the highest judicial authority in Iraq, declined to issue a state order to halt the decision made by the Iraqi Council of Ministers to send 700 billion dinars to the region. The funds will be used to pay the salaries of public sector employees and workers in the region.

Rahim issued a written statement to local Kurdish media, stating that the Federal Court has rejected Representative Mustafa Sanad’s request to issue a state order suspending the work of Federal Council of Ministers Resolutions No. 23500 and 23520 for the year 2023. The resolutions were related to granting a loan worth 700 billion dinars per month to the Kurdistan Region government for a period of three months.

A delegation from the Kurdistan Regional Government, led by Masrour Barzani, visited Baghdad last week. They held a series of meetings with the three presidencies, leaders of political blocs and forces, with the aim of resolving the issue of financing the monthly salaries of the region’s employees and securing Kurdistan’s share of the budget. The Council of Ministers later announced that a formula has been agreed upon and an understanding has been reached.

The Council of Ministers, in a session held on September 17, decided to amend its previous decision No. (23500) of 2023.

  1. The Rafidain and Rasheed Banks, along with TBI, have decided to lend the Iraqi Kurdistan Regional Government a total of 2.1 trillion dinars for the current fiscal year. The loan will be paid in three equal installments of 700 billion dinars, with the first installment starting in September.
  2. The loan amounts mentioned in Paragraph (1) will be repaid from the region’s allocations in the federal general budget for fiscal year 2023, after settling outstanding debts.
  3. “If the remaining amount of the region’s share is not enough to repay the loan amounts as mentioned in Paragraph (2), then the Federal Ministry of Finance will repay the loan amounts from the region’s allocations in the federal budget for the fiscal year 2024, or from any other outstanding dues that the aforementioned banks may have before paying any dues to the region.”
  4. The Ministry of Finance deposits funds equal to the loan amounts with the aforementioned banks and withdraws them after implementing paragraphs 2 and 3.
  5. The Federal Office of Financial Supervision, in coordination with the regional Office of Financial Supervision, will conduct an audit of the number of employees, social welfare recipients, and retirees in the region based on the lists submitted to the Federal Ministry of Finance. The audit will also cover the amount of their salaries. The audit process will not exceed 30 days from the date of issuance of this decision. Both offices will ensure that the requirements are met.