Iraq moves to program-based budgeting from 2027, lawmaker says

BAGHDAD, Iraq — Iraq's parliament and the executive branch plan to transition to a program and performance-based budget beginning in 2027, Finance Committee member Hussein al-Darraji said. The Finance Committee hosted Finance Minister Falih al-Sari last week to discuss the main amendments to the draft budget and the mechanism for moving to program-based budgeting. The first phase of the 2027 program budget will cover the Ministry of Electricity and the cities of Diwaniyah and Saladin, al-Darraji said. The 2028 plan will be expanded to include five ministries and five cities, with the new framework subsequently extended to other state institutions. Al-Darraji said the program-based approach is intended to protect public funds, regulate spending channels and align investment budget items with the government's strategic vision. Finance Committee chair Ady Awad said the committee will continue to support legislation that helps overcome financial challenges and will work to develop non-oil revenue sources and strengthen fiscal sustainability. Minister al-Sari said the 2027 draft provides for a phased program-based budget that will pilot certain cities and later expand to all cities across the country. The Cabinet approved preparation of the program budget in June under Prime Minister Ali Falah al-Zaydi's direction, in coordination with the World Bank and the Finance Committee, and Prime Ministry financial adviser Muzahir Mohammed Saleh has announced that work on the 2027 federal budget draft has begun.