VZCZCXRO1768
RR RUEHBC RUEHDA RUEHDE RUEHIHL RUEHKUK
DE RUEHGB #0843/01 0691216
ZNR UUUUU ZZH
R 101216Z MAR 07
FM AMEMBASSY BAGHDAD
TO RUEHC/SECSTATE WASHDC 0102
INFO RUCNRAQ/IRAQ COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHDC

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. 
 
-------------------------------- 
"Our Responsibility is to Spend" 
-------------------------------- 
 
¶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 
------------------------- 
 
¶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.) 
 
----------------------------------- 
The CD-ROM: Clarifying Instructions 
----------------------------------- 
 
¶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 
 
BAGHDAD 00000843  002 OF 002 
 
 
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