GOI HOLDS BUDGET EXECUTION CONFERENCE

UNCLAS SECTION 01 OF 02 BAGHDAD 000843

SIPDIS

SBU
SIPDIS

E.O. 12958: N/A
TAGS: ECON EFIN PGOV IZ
SUBJECT: GOI HOLDS BUDGET EXECUTION CONFERENCE


1. (SBU) Summary: The Government of Iraq hosted a day-long
conference on 'Accelerating Budget Execution' on March 7,

2007. Led by Minister of Finance Bayan Jabr, Deputy Prime
Minister Barham Salih, and Minister of Planning and
Development Coordination Ali Baban, the conference was
attended by GOI ministers, governors, and senior provincial
representatives and their staffs. Some 200 Iraqi officials
attended the event along with a small group of international
observers, and a large press presence. The importance of
implementing the capital budget was a unanimous message
throughout the conference; speakers addressed both corruption
concerns and the penalties of slow spending. There was also
time for questions and statements from the audience, which
largely contributed to an open, constructive discussion. The
conference organizers distributed a CD-ROM with budget
documentation, spending guidelines, and contracting
regulations. The Embassy Baghdad Budget Execution Task Force
has encouraged the GOI to hold this type of conference for
several months, and held a follow-on conference for Coalition
Provincial Reconstruction Teams on March 8 and 9. End
summary.

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"Our Responsibility is to Spend"
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2. (U) Deputy Prime Minister Barham Salih, Minister of
Finance Bayan Jabr and Minister of Planning and Development
Coordination Ali Baban opened the conference, each
emphasizing the need to execute the capital budget. DPM
Salih and MoF Jabr both highlighted the article in the 2007
budget law that allows for a reallocation of funding from
under-spending ministries and provinces after a mid-year
review. Several speakers tried to mitigate concerns that
taking routine spending decisions might open them up to
accusations of corruption. "Our responsibility is to spend,"
said DPM Salih. The head of the Board of Supreme Audit
(BSA),Dr. Abdul Bassit Turki, and the head of the Commission
on Public Integrity (CPI),Judge Radhi al Radhi, both
encouraged the audience to execute the budget "properly".
The Minister of Finance also emphasized the role of the
Council of Representatives (CoR) in oversight of government
spending. Yanadam Kanna, Vice Chair of the Economic
Committee at the CoR, gave remarks that listed security
problems, lack of qualified personnel, and the inexperience
of CPI as the primary reasons for slow budget execution.

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A Constructive Discussion
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3. (U) The audience of over 200 people included ministers or
deputy minister of the ministries of Electricity, Defense,
Interior, Industry and Minerals, and Housing and Construction
and the governors, deputy governors and provincial council
chairman of Anbar, Baghdad, Salah ad Din, Wasit, Al
Qadisiyyah, Karbala, Najaf, Diyala, Kirkuk, Ninewa and
others. The audience participated actively in the discussion
throughout the conference, both during the morning in
response to formal remarks and in the open session in the
afternoon. Pointed questions on payments, allocations,
spending authority limits and requests for training were made
directly to the ministers involved. Minister Jabr raised the
draft Provincial Powers law to emphasize the legislative,
rather than executive, nature of the Provincial Councils.
(Note: The draft Provincial Powers law has had its first
reading at the Council of Representatives. End note.)

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The CD-ROM: Clarifying Instructions
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4. (U) The conference organizers distributed a CD-ROM with
budget documentation, spending guidelines and contracting
regulations, including topics such as letters of credits and
feasibility studies. Some of these documents were the result
of intensive negotiations between the Ministry of Finance and
the Ministry of Planning and Development Coordination over
the past few weeks; they reflect a joint MoF and MoPDC
product and resolve past issues of conflicting regulations
from the two ministries most responsible for budget execution
oversight.

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Comment
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5. (SBU) The GOI Budget Execution Conference is a good first
step in addressing confusion regarding regulations and fears
of accusations of corruption, two major obstacles to
successful budget execution in Iraq. The discussions were

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frank and constructive, and represented officials from almost
all of the related government entities. The Embassy Baghdad
Budget Execution Task Force has encouraged the GOI to hold
this type of conference for several months. A follow-on
conference for Coalition Provincial Reconstruction Teams met
on March 8 and 9. It disseminated and reviewed the GOI
budget execution material and shared best practices on
tracking projects and contracting.
KHALILZAD