A deficit of 43 trillion dinars: Balancing inflation and the refusal to increase Kurdistan’s share
A deficit of 43 trillion dinars: Balancing inflation and the refusal to increase Kurdistan’s share
11-3-2026
The federal budget is facing a critical financial juncture due to unprecedented inflation in operational spending and a mounting deficit. Economic warnings are mounting about the depletion of the treasury caused by exorbitant privileges granted to special-grade officials and the inflated, unaccounted-for funding of pension and welfare funds. This comes as the Kurdistan Region’s demands for an increased financial allocation have been met with firm rejection from both parliament and the government.
The economic expert, Nasser al-Kinani, revealed data and figures exposing deep structural imbalances within the budget, warning of continued financial losses resulting from bloated public sector employment, inflated special-grade positions, and undeserved salaries. He also highlighted unjustified discrepancies in social safety net allocations.
Al-Kinani told Al-Maalomah News Agency in an exclusive statement that “the general budget is the largest in the country’s history, reaching 217 trillion dinars, compared to expected revenues of no more than 174 trillion dinars, leaving the country with an operational deficit of nearly 43 trillion dinars.” He explained that “the most prominent flaw lies in funding the pension fund from the budget, when it should be self-financing through employee deductions, not being drained to pay pensions to groups who have not provided actual public service, such as members of the National Assembly, the Council of Representatives, and successive presidencies.”
He added that “the social welfare program alone consumes about 33 trillion dinars, equivalent to 14.8% of the total budget. This is an enormous sum that is not logically proportional to the announced number of beneficiaries and requires a comprehensive audit and a genuine review to clarify expenditures and address shortcomings.” He called for “the strict implementation of administrative automation to uncover ‘ghost employees’ and instances of double employment in the Baghdad Municipality, other municipalities, and the oil and electricity sectors.”
Shocking figures reveal the extent of the bloated senior civil service. An economic expert unveiled a map of this overstaffing, highlighting the existence of 770 high-level (A) positions, granting their holders allowances and privileges equivalent to a ministerial rank. These include 118 positions within the Ministry of Foreign Affairs alone, in addition to over 5,300 high-level (B) positions and approximately 51,841 first-level (director general) positions. These positions are accompanied by extensive security details, travel allowances, and enormous financial allocations that burden public spending.
Al-Kinani warned of the worsening crisis, noting that the number of state employees, which already exceeded 4,074,000, is poised to surpass 5 million with continued job expansion and the increase in special grades. He emphasized that controlling the deficit requires genuine courage to reduce the privileges of senior officials, eliminate the bloated bureaucracy, and eradicate the sources of waste.
Parliamentary rejection of imposing a 14% share at the expense of the governorates.
Regarding the financial disputes between the central government and the region, Rabie Abdul Jalil, a member of the Parliamentary Oil, Gas and Natural Resources Committee, confirmed the impossibility of meeting the Erbil government’s demands to obtain 14% of the general budget, stressing the strict commitment to the percentages determined according to the surveys and official data at the Ministry of Planning, which determine the region’s entitlement to only 12%.
Abdul Jalil explained in a statement to Al-Maalomah that “the region’s demand to increase its share is impossible and completely unfeasible, and will be met with strong and decisive parliamentary rejection from most blocs and representatives from various governorates within the halls of the House of Representatives.” He pointed out that “the government is legally and morally obligated to adhere to the 12% quota, as the distribution of federal wealth must be based on fairness, population size, and indicators of deprivation, without yielding to any pressures seeking to impose undeserved percentages.”
These financial challenges place the executive and legislative branches before an urgent national imperative to restructure spending. Observers agree that reducing financial waste resulting from the proliferation of special grades and high allowances, and adjusting the constitutional quotas for regions and governorates according to actual entitlement rather than political favoritism, are the only inevitable paths to avoid financial collapse and maintain overall economic stability.
almaalomah.me
