The Kurdistan Regional Government on Wednesday has abolished the salary cuts for the low-earners who work for the government following a meeting headed by Prime Minister Nechirvan Barzani.
It also reduced salary cuts for high-earners to as low as 30 percent, down from about 60 percent.
The measures announced are in response to anti-government protestors, calling for an end to the unpopular salary system introduced by the KRG in 2016. It also comes in light of funds sent by the Iraqi government to the Kurdistan Region.
"Today, after the passage of three years, I am delighted to announce that we have taken a very good step in the interest of the salary holders, a step towards ending the [salary] saving [system]," PM Barzani said in his press conference held in Erbil following the meeting.
"This is an important step. It is not the entire measures. But I can say that, following the application of the reforms currently put before the Kurdistan parliament ... I can say we can reach the level to cancel the salary savings [program]," he added, saying that Erbil is close to end the measure for all state employees "soon."
The Kurdistan parliament late last year passed a reform package regarding the salary-system of the Kurdistan Region. But it is not in effect yet because of a section that gives Kurdish MPs high pensions, a move not well received by the public.
Under the new regulations revealed by the KRG's Finance Minister Rebaz Hamlan, who held a joint press conference with PM Barzani, people who earn below 400,000 Iraqi dinars ($336) will no longer have their salaries cut.
The Kurdistan Region will impose the new regulations once it receives continued cash as installments from the Iraqi government, Hamlan said, adding that Iraq have promised to do so.
"We receive every month 375 billion dinars ($315 million) from the [KRGs] Ministry of Natural Resources, the federal government provides us with 317 billion dinars ($266 million dollars), and thankfully, the Unites States of America sends us 25 billion dinars ($21 million)," Hamlan explained, saying that the total of the sum of the money will be spent on the salaries.
He said that the KRG, under the salary-saving system, is now paying the salary holders each month a total of 588 billion dinars ($493 million). But since the money received from oil revenues plus the sum from Iraq and the US government equates to 720 billion dinars ($604 million), the KRG decided to redistribute the remainder to make changes to the cuts, explained Hamlan.
For example, earners whose salary was 800,000-900,000 dinars in 2016 before the introduction of the cut, will now have their salaries reduced only by 18 percent, Hamlan said.
Renowned audit firm Deloitte will publish figures for the oil revenues of the Kurdistan Region very soon, Amanj Rahim, the Secretary of the KRG Council of Ministers also said at the conference.
The firm published its first report in January that stated they found no "misstatement" in KRG's financial figures with regard to oil production and export.
Both Rahim and Hamlan said that they continue to pay financial entitlements to international energy companies.
The two officials stressed that the KRG is also responsible for paying non-salary expenses such as delivering services in the Region.
PM Barzani said that they "understand," and respect the people's right to protest against the salary cuts, but warned that his government will not tolerate the spread of "violence" under such pretext.
He thanked the people of Kurdistan who endured economic difficulties, mainly caused by the Iraqi budget cut in 2014.
Asked about a demand by some anti-government protesters who have called for the removal of the current cabinet, Barzani said that such requests are proof that some political parties want to make political gains.
"The protests are manipulated," he said. "The political parties are manipulating their rightful demands. The government has come through ballot boxes, and the only way to remove it is using the same method," he said.
The Kurdistan Region is expected to hold general elections later this year. It was delayed from its original November 1 date after the fall of the disputed oil-rich Kirkuk to Iraqi forces last October.
State employees have continued their anti-government protests in a number of Kurdish cities on Wednesday including in Erbil, Sulaimani, and Halabja.
“We will no longer accept the salary saving system,” Abdullah Mohammed, an organizer of the striking health workers in Sulaimani, told Rudaw on Tuesday when asked whether they plan to end their walkout if the KRG reduces the percentage of the salary cuts by 10 to 30 percent.