*** EXCELLENT READ WHICH REVEALS THE LACK OF DEPTH TO MOST IRAQI NEWS REPORTS : THERE ARE SOME REAL REVELATIONS IN THE CONTENT OF THIS ARTICLE ABOUT THE SPECIFIC POINTS OF CONFLICT BETWEEN THE " GOI " AND THE " KRG " REGARDING BUDGET ISSUES AND CONSTITUTIONAL ARGUMENTS ***
Gorran’s Detailed Analysis of Iraq’s 2014 Budget
The report estimates the Iraqi budget for this year at more than 164.5 trillion Iraqi Dinars, exceeding the 2013 budget by 27 trillion ID.
ERBIL, Kurdistan Region – The Kurdistan Region’s share from Iraq’s 2014 budget is 9.9 percent, a report by the autonomous Kurdish enclave’s Change Movement (Gorran) says, as Erbil continues efforts to win the 17 percent allocation specified in the constitution and resolve other oil and budget disputes with Baghdad.
The report titled “Analysis Report of the 2014 Budget Bill of Iraq and the Share of Kurdistan Region,” and sent to the Kurdish parliament by Gorran, provides a detailed examination of the Iraqi budget.
It estimates the Iraqi budget for this year at more than 164.5 trillion Iraqi Dinars, exceeding the 2013 budget by 27 trillion ID.
National income in 2014 is estimated at about 139.6 trillion ID, with a deficit of some 20.8 billion ID.
The budget expects oil revenues to come from selling 3.4 million barrels per day, higher than the 2.9 million bpd specified for 2013, according to the Gorran report.
The Kurdistan Region needs to pump out 400,000 bpd in 2014, while in 2013 it was required to produce 250,000 bpd. The budget stipulates all Iraqi oil revenues – including Kurdistan’s – to be deposited in the Development Funds of Iraq (DFI) in the United States.
The International Monetary Fund (IMF) has warned that the Iraqi budget contains “a structural problem” for relying too heavily on oil revenues, making it vulnerable to oil price variations.
The major portion of the budget – some 99.5 trillion ID -- is allocated for governance, with only about 59.3 trillion ID going to investment, the report says. It shows that 36 percent of the Iraqi budget is allocated for investments, while international standards call for investments between 65-70 percent.
The limited investment budget is expected to negatively impact the improvement of social services and economic infrastructure, which are major public demands.
The Kurdish share of the budget, after subtracting sovereign and governance costs, is 17 percent of the total, or about 16.5 trillion ID. That is 2.46 trillion ID higher than in 2013. Erbil’s share comes from 15.4 trillion ID from the total Iraqi budget, and 933 billion ID from Kurdistan’s share in the funds allocated to the Development Project of the Iraqi Governorates.
Gorran notes that the 2014 budget lacks any economic vision. It contains no initiatives to boost local production, decrease imports, create jobs and improving income for Iraqi citizens.
It adds that the bill is focused more on improving military and political strength, containing steep rises for governance, security and defense expenditures, and relatively small outlays for the agricultural and industrial sectors.
Defense and security expenditures take up 23.2 trillion ID of the budget, while agriculture outlay is a paltry 4 trillion ID. This means that the security and the defense expenditures are seven times greater than the agricultural sector. Industry receives only 415 billion ID – 14 times less than for defense and security.
Gorran notes that the Kurdish share of the budget is calculated after deducting governance and sovereignty costs. This means that Kurdistan’s share will fall with every increase in the governance and sovereign expenditures. However, Kurdistan has its own share in governance and sovereign expenditures as well.
Sovereign costs in 2014 equal about 47.5 trillion ID. The 17 percent Kurdish share is calculated after subtracting this amount from the total budget.
Erbil should receive 17 of the allocation for governance costs. Part of this budget was not given to Kurdistan in the past, especially the costs of electricity production and pilgrimage to Mecca.
In 2012 the Kurdistan Region should have received 289 billion ID from the central government for fuel supplies and electricity generation, but this never happened. In 2013, the same expenditures totaled 302 billion ID, but were again withheld.
In 2014, about 12.6 trillion ID is allocated for governance expenditures. The Kurdistan Region constitutionally deserves more than 2 trillion ID, but is not expected to receive it.
Some articles in the budget bill are considered harmful to the Kurdistan Region if implemented, such as article 10, which is related to local Kurdish revenues.
It states that domestic Kurdish revenues will be identified and calculated by audit agencies in Erbil and Baghdad, requiring the Kurdistan Regional Government (KRG) to send the amount to Baghdad on a monthly basis.
“If Kurdistan Region failed to send its domestic revenues to the federal central bank, the central government shall subtract that money from the budget of the Kurdistan Region,” according to a clause in the article, which was contained in previous budgets and can be activated by Baghdad at any time.
The Kurdistan Region has sent its revenues to the central bank in the past, but Baghdad has not agreed to the calculations.
The same article also holds the KRG or any other governorate responsible for damage to any telecommunications facilities, including Internet cables.
That means that the KRG could be penalized for damage done by companies owned by – or close to -- the Kurdish political parties.
Article One of the bill states that 400,000 bpd will be produced by the KRG, and that Baghdad will determine fines if that target is unmet, meaning that the Kurdish budget will suffer every time there is a dispute over production with the central government.
At $100 a barrel, the production target should contribute $14.6 billion (17.5 trillion ID) to the Iraqi budget, whereas the allocated budget for Kurdistan is 16.4 trillion ID.
Article 9 states that, “the expenditures of the guards of Kurdistan Region (Peshmarga) such as salaries, arms, and other necessities will be provided by the central government in a way that will not violate the Iraqi constitution.”
Since 2007, this article has been repeated in the Iraqi budget laws in various ways, without being implemented. According to the estimates, the central government owes more than 10 trillion ID to the Ministry of Peshmarga.
Breaking News … Parliament fails to hold Saturday session
Saturday, 01 February 2014 13:19
Baghdad (AIN) –The parliament failed to hold Saturday session due to the lack of quorum.
Parliamentary source stated to AIN "The parliament chairmanship postponed holding the session due to the lack of quorum caused by the absence of MPs of the Kurdistani Alliance and Mutahidoun Alliance."
"The session was postponed till next Monday," the source concluded.
BAGHDAD / NINA / Independent MP, Sabah al-Saadi revealed that the State of Law coalition MPs boycotted the meetings of the Council of Representatives.
He said at a news conference at the parliament building today, "members of the state of law coalition have boycotted the sessions of the House of Representatives when the budget bill included on the agenda."
Saadi ruled out holding session for the House of Representatives today due to lack of quorum because the absence of MPs of Motahedoon, State of Law and the Kurdistan Alliance.
The House of Representatives failed on last Thurs. to start the first reading of the budget bill of 2014, and adjourned it to Saturday for lack of a quorum.
Breaking News … Nijaifi announces return of Mutahidoun MPs to parliament sessions
Saturday, 01 February 2014 13:52
Baghdad (AIN) –The parliament Speaker, Osama al-Nijaifi, announced the return of the MPs of Mutahidoun Alliance to the parliament sessions.
In a press conference, Nijaifi said "Due to the calls of the Head of the Supreme Iraqi Islamic Council and the Sadr Trend in addition to the other blocs, I call Mutahidoun MPs and the MPs of the Kurdistani Alliance to attend the parliament session to endorse the important laws and discuss the crisis in Anbar."
Urgent.. National Alliance agrees with the presidency of the parliament to include budget and retirement at next Monday meeting
BAGHDAD / NINA / MP, of the State of Law coalition, Sadiq al-Labban declared that an agreement between the National Alliance and the Presidency of the Council of Representatives to include the federal budget for 2014 and the retirement law on the Parliament agenda on Monday.
He said in a statement to the National Iraqi News Agency / NINA / " The National Alliance agreed to include the laws of the general budget and the retirement and social welfare to be discussed during the session on Monday after a request made by the state of law coalition."
The House of Representatives has adjourned its meeting scheduled today to next Monday for lack of a quorum.
A special committee formed by State of Law to communicate with the other political blocs to solve outstanding problems in budget law
BAGHDAD / NINA / State of Law coalition announced that it formed a special committee to communicate with the other political blocs for solving the outstanding problems in the budget law.
MP, Khalid al-Attiyah, chairman of the State of Law parliamentary bloc held the Presidency of the Council of Representatives the responsibility to "disable reading vote on the budget and retirement laws for not including them on the agenda of today's meeting."
" the boycotting blocs , the Kurdistan Alliance and Motahedoon coalition, delayed the budget and Retirement Law, in addition to the presidency of the Council , " calling for the two blocs to return to attend the meetings of the Council for the purpose of reading the budget and show notes on it after reading," adding that "the insistence of the blocs on the disable the budget and retirement will affect their approval , and consequently will affect the interest of the country and the Iraqi people."
Arbil / NINA / Kurdistan leader, Massoud Barzani discussed, in telephone call, with Joe Biden , U.S. Vice President, the bilateral relations and negotiations between Baghdad and Erbil .
The head of the Presidium of the region , Fouad Hussein, said in a press statement that: " the conversation between Biden and Barzani also dealt with the visit, which was scheduled to be paid by Barzani on Friday to Washington , which was postponed to an undetermined date ," noting that the two sides stressed the need that the visit takes place at an appropriate time later.
He continued , "The two sides discussed the general situation of Iraq, especially the security situation and the ongoing negotiations between the federal government and the provincial government ."
BAGHDAD / NINA / House Speaker Osama al-Nujaifi signed the longest peace document to renounce violence and terrorism in Iraq, in cooperation with the parliamentary commission on tribes and the (Najaf's youth group) in the social networking / FB /.
The signing of the document was attended by First Deputy Chairman of the parliament, Qusay al-Suhail and a number of MPs. "/