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September salaries are weeks late, October salaries have not yet been paid, and the government is trying to borrow again from state reserves
Qusay, the government employee, was terrified when his monthly salary was late. Waiting days became weeks and he was late in paying his house rent and his monthly bills.
The man, who works as a graphic designer for the Ministry of Health, spends nearly half of his salary on his monthly rent, which is about 450,000 Iraqi dinars, or the equivalent of about $ 400, and is worried that he will find himself and his family homeless if he is two months late in payment.
Qusay says the delay in salaries is severely affecting his ability to carry a burden of living. The Iraqi government is struggling to cover the salaries of inflated public sector employees amid an unprecedented liquidity crisis caused by low oil prices. September salaries are weeks late, October salaries have not yet been paid, and the government is trying to borrow again from state reserves.
The crisis has fueled fears of instability ahead of upcoming mass demonstrations this week. The government had reviewed a plan, or rather a "vision," to bring about comprehensive structural changes in the Iraqi economy, in a "white paper" presented to the Iraqi parliament members and political factions last week.
But with the early elections approaching, advisors to the prime minister fear that there is no strong political will to implement that vision.
"We call on the same people who we protest against and criticize, to reform the system," said Sajid Jiyad, an ethnic researcher. Calls for the White Paper to cut public sector salaries and reform the state’s financial sector would destroy the system of quotas and favoritism that political elites rely on to consolidate their powers.
Much of this muhasasa system is the distribution of state jobs in exchange for subsidies, and as a result, the number of public sector workers has tripled since 2004. The government is now paying salaries that are 400 percent more than it did 15 years ago. 75 percent of the state's expenditures in the fiscal year 2020 are intended to pay for public sector expenditures, a huge drain on dwindling financial resources.
Member of the Finance Committee in the Iraqi Parliament, Representative Muhammad al-Darraji, says, "The situation is now dangerous."
A political official in the government, speaking on condition of anonymity, said that the political factions deny the need for change, and believe that oil prices will rise again and that "things will be fine ... We will not be well, the system cannot be supported and will collapse sooner or later."
Iraqi activists called for a march on October 25, which is expected to attract large crowds, after a year of massive anti-government protests that saw tens of thousands take to the streets to demand reforms and the overthrow of the corrupt political class.
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