Shafaq News- Baghdad
An Iraqi government team has proposed wide-ranging measures to curb public spending under the 2027 federal budget, including examining the possibility of merging some independent bodies and reviewing salaries of certain groups and pension payments to some officials, a government source told Shafaq News on Monday.
The team, tasked by Prime Minister Ali al-Zaidi with assessing the financial crisis and proposing solutions, has submitted a series of recommendations in coordination with the parliamentary legal committee to ease pressure on state finances and limit unnecessary spending, the source said. The proposals include reviewing the oil sector and crude oil export procedures, merging some independent bodies, tightening oversight of dollar transactions, cutting government spending, and reviewing salaries for certain groups and pension payments to some officials.
According to the source, to avoid political controversy over some of the proposed measures, the team is seeking to include a general provision in the 2027 budget bill allowing the government to defer financially burdensome obligations and measures during the coming fiscal year, provided this does not negatively affect the public interest.
Such a provision would give the government greater flexibility to manage spending and set priorities based on available financial resources, while avoiding specific measures that could spark political disputes or objections from affected groups, the source noted.
The draft budget bill is expected to be referred to parliament soon for consideration. If the proposed spending cuts are approved, government spending is expected to fall significantly next year, the source said.
Iraq’s public finances face mounting pressure from declining oil revenues and disruptions to crude exports, alongside rising operating costs, particularly salaries for public-sector employees and pensioners and spending on social protection programs.
On September 27, the Ministerial Council for the Economy approved the draft 2027 federal budget and referred it to the Council of Ministers. The Cabinet has yet to give final approval before the bill is sent to parliament.
Preliminary figures put total expenditure at about 217 trillion dinars, with a projected deficit of 50 trillion dinars. The draft assumes an oil price of $58 per barrel.