Republic of Iraq District Government Field Manual: Iraq Local Governance Program

Iraq Local Governance Program
Republic of Iraq
District Government
Field Manual
OCTOBER 2007
Ve r s i o n 2
USAID-Funded Local Government Strengthening Project RTI International

TABLE OF CONTENTS
Introductory Note 3
Abbreviations 4
Glossary 5
Arabic Terminology 6
Map of Iraq 6
Part I 7
Chapter 1. Introduction 7
Chapter 2. Iraq As A Federal State 8
Chapter 3. Constitutional Mandates In Iraqi Governance 11
Part II 13
Chapter 4. Framework of Sub-National Governance 13
Chapter 5. Special Case: Baghdad Governorate and Amanat 17
Chapter 6. The Federal Presence 23
Part III 29
Chapter 7. Fiscal: Fiscal Powers and Current Intergovernmental Financial Framework 29
Chapter 8. Budget: Qada’a and Nahiya 36
NOTES 47
This publication was made possible through support provided by the U.S. Agency for International Development under Contract No. 267-C-00-05-00505-00.
The opinions expressed herein are those of the authors and do not necessarily reflect the views of the U.S. Agency for International Development.
Republic of Iraq District Government Field Manual

INTRODUCTORY NOTE
This manual aims to guide the practice of embedded Volume II of this manual will present more detailed
Provincial Reconstruction Teams (ePRTs), deployed resource material that may be examined for further
in mid-2007 in the governorates of Baghdad, North information on the subjects covered in this Volume I.
Babil, and Al Anbar in Iraq. The material will include the Constitution of Iraq;
The manual consists of a glossary, a map of Iraq, selected relevant legislation; a map of Iraq; lists of
and three parts. The glossary defines certain terms local councils, governorate administrative units, and
used in the text. Part I (Chapters 1 to 3) contains a federal offices in each of the governorates that will
“Chapter Overview” at the beginning of each chapter receive ePRTs; and explanatory material on public
to guide the reader to the chapter’s contents. Part finance and economic development.
I differs from Parts II and III in style and format: Acknowledgement: We would like to express our
it is in narrative form and covers background deep appreciation to Farqad Salih for his assistance
information relevant to Parts II and III. The text in with the translation of material.
Parts II (Chapters 4 to 6) and III (Chapters 7 to 8) is Vijaya Samaraweera, Ricardo Silva Morales, Muhsin
separated into numbered paragraphs to categorize Jaber, Esam Younis, and Najed Hamody
information and enable the reader to easily extract
the desired information. Part II examines, in turn, Iraq Local Governance Program, Baghdad
the framework of sub-national governance, the November 4, 2007
Baghdad Governorate and Amanat, which have their
distinctive features, and the nature of the presence
of the federal administration at the governorate
level. Part III focuses on fiscal and budgetary
matters, with Chapter 7 covering fiscal powers and
intergovernmental financial networks and Chapter 8
examining the qada’a and nahiya budgets.
October 2007
ABBREVIATIONS
ARDF Funds for Accelerated Reconstruction and MOPCD Ministry of Planning and Cooperative
Development Projects transferred by the Ministry Development
of Finance (MOF) to governorate councils under the NDS National Development Strategy
provisions of the 2006 budget
NGOs Nongovernmental organizations
CERP Commander’s Emergency Response Program
O&M Operations and Maintenance
COA Chart of Accounts for the Public Sector
Order 71 CPA Order No.71 on Local Governmental
Constitution Constitution of the Republic of Powers, 06 April 2004
Iraq 2005
Order 95 CPA Order No. 95 on Financial
COR Council of Representatives Management Law and Public Debt Law,
CPA Coalition Provisional Authority 02 June 2004
DGs Directors General PDS Provincial Development Strategy
ePRT embedded Provincial Reconstruction Team PRDC Provincial Reconstruction Development
IRRF Iraq Relief and Reconstruction Fund Council
ITAO Iraqi Transitional Assistance Office PRT Provincial Reconstruction Team
KRG Kurdistan Regional Government SOEs State-Owned Enterprises
Law No. 130 of 1963 Revenue of Municipalities TAL CPA’s Transitional Administrative Law of
Law No. 130 of 1963 8 March 2004
MOF Ministry of Finance UK United Kingdom
MOMPW Ministry of Municipalities and UN United Nations
Public Works USAID United States Agency for International
Development

GLOSSARY
Note: This glossary provides basic definitions of the Implementing legislation A law that puts into
technical terms as used in this manual. No attempt effect the directives or instructions as formulated in
is made to offer definitive or expansive explanations the Constitution.
or variations to be found in general usage. When the Judicial review Review by the cognizant judicial
term is first used in the text, it is highlighted. body of the constitutionality of legislative measures
Administrative unit Geographically demarcated and executive action.
area within which a formal sub-national Refresh The replacement of the membership
administration has been established. of the governorate councils and local councils by
Citizen caucus An ad hoc gathering of adults of CPA officials.
local-level administrative units organized by the Self-funding services Federal services and facilities
Coalition Provisional Authority (CPA) to nominate that are entitled to collect certain fees. This revenue
candidates for sub-national councils. is supplemented by the National Budget funds.
Constitutional mandates Binding fundamental Self-sustained services Services that are able to pay
constitutional principles. for their operations and maintenance on the basis of
Deficit municipalities Qada’as (districts) that do user fees.
not collect sufficient revenue to defray their share of Surplus municipalities Qada’as that collect revenue
the cost of the beladiya (federal directorate office in more than sufficient to bear the cost of beladiya by
qada’as and nahiyas) (the cost is shared between the themselves—contra: deficit municipalities.
qada’as and Ministry of Municipalities and Public
Works [MOMPW])—contra: surplus municipalities. Transfers Non-reimbursable release of money to
administrative units by the federal government.
Federal state A state that is distinguished by a
central government and sub-national governments, Unitary state A state that is governed as a single
with each entity having its own sphere, independent political entity, with a centralized political structure.
yet co-ordinate.
October 2007
Arabic Terminology
Map of Iraq
Althma’am Reconstruction levy
Dahuk
Amanat Baghdad capital mayoralty Dahuk
Erbil
Amin The Amanat’s principal executive official Mosul
Erbil
(Mayor of Baghdad Capital) Ninewa
Kirkuk Sulaymaniyah
Beladiya Office of the Ministry of Municipalities Kirkuk Sulaymaniyah
(Ta'mim)
and Public Works in the qada’a and kati’
Salah Ad Din
Hayy Neighborhood Samarra Diyala
Kati’ District (in Baghdad capital) Ba'qubah
Ramadi Baghdad
Mudiyar Executive official for subdistricts (nahiya) Baghdad
Anbar
Wasit
Nahiya Subdistrict Karbala Babil Kut
Karbala Hillah
Qa’im maqam Executive official for districts Qadissiyah Maysan
Najaf Diwaniyah Amarah
(qada’a)
Dhi Qar
Najaf Samawah
Qada’a District (outside of Baghdad capital) Nasiriyah
Basrah
Muthanna Basrah
Kurdistan Region
Governorate
Governorate Capital
Capital of Iraq

PART I
Chapter 1. Introduction respective authority, leaving details to be worked out
by implementing legislation.
Overview In many instances, the constitutional language
• The Constitution is a necessary but not sufficient lacks clarity. There are gaps in the specifications
source for defining local government in Iraq. Its of the institutional arrangements and with
main drawbacks are that respect to their roles and responsibilities. These
• It does not spell out in detail the particular problems make it difficult to enumerate precisely
structural form or authority of certain and completely the structure and institutions and
institutions of governance: such details are left authorities of governance in Iraq solely on the basis
to be determined by implementing legislation; of the Constitution.
• Its language is ambiguous and lacks clarity in Consequently, it is necessary to fall back upon the
some cases; and pre-Constitution legislation to provide guidance.
The pre-Constitution laws have retained their legal
• It contains gaps in the specification of
validity on the basis of the constitutional rubric that
institutional arrangements and in the
“existing laws shall remain in force, unless annulled
definition of their roles and responsibilities.
or amended in accordance with the provisions of this
• Where the Constitution contains gaps in defining Constitution” (Article 130)1.
local government, it is necessary to fall back on
pre-Constitution laws that have retained their Yet, governance in Iraq is to be understood not
legal validity and ad hoc measures that have only in terms of the constitutional scheme and the
become a custom over time. legislative legacy. Ad hoc measures embraced as
functional necessities in governance have assumed
The Constitution does not spell out in detail the the character of “custom,” and they have been
structural form or authority of all institutions of
governance. Rather, it identifies, in broad terms, 1 The only law specifically annulled by the Constitution was the Transitional
the specific institutions and the substance of their Administrative Law (TAL). Its Articles 53(A) and 58, which dealt with the
future of Kirkuk, were saved.
October 2007
engrafted into the apparatus for governance. The • Details of the authorities of governorates
best example of this is in Baghdad’s Amanat (see outside the regions are not enumerated in
Chapter 7). the Constitution; they are to be determined by
implementing legislation.
Chapter 2. Iraq As A Federal State
• Capital territory, formed of the municipal
Overview boundaries of Baghdad, was newly created.
• Iraq, a unitary state, first became a federal state The antecedents of Iraq as a federal state are
with the establishment of the Iraq Interim traced back only to the inauguration of the Iraqi
Government in June 2004 by the Coalition Interim Government on 30 June 2004 as the
Provisional Authority (CPA). “federal government” pursuant to the Transitional
• The Constitution, which came into force on Administrative Law (TAL) of 8 March 2004.
28 December 2005, ushered in new Iraq This law, issued by the CPA, functioned as the
also as a federal state. The basic distinction “Interim Constitution” of Iraq until a “permanent
between the federal power and the two levels constitution” of Iraq came into force in December
of sub-national governance that existed was 2005. The TAL was the basis for the establishment
retained, but institutional arrangements were and the legal authority of the successor to the
sharply different. Iraqi Interim Government, the Iraq Transitional
Government that was formed following the national
• The federal government is organized under
elections of 30 January 2005.
three separate branches, legislative, executive,
and judiciary, under the principle of separation Iraq—beginning in modern times as a monarchy
of powers. created in 1921 and succeeded by the Republic
in 1958—was a unitary state until the CPA’s
• Sub-national governance is formed by
adoption of the federal model for post-hostilities
hierarchically arranged regions and by
governorates outside a region.

Iraq; this constituted a radical departure in national Council whose composition and authority is to
governance. The federal (that is, central) government be determined by implementing legislation and
is vested with “exclusive competence” over a list of which is intended to act as a second legislative
specified subjects, and the authority over subject chamber, together constitute the legislative branch
matters outside that specification was handed over at the center. The Federation Council has not been
to the two levels of sub-national governments, the created as of October 2007. The executive branch is
Region of Kurdistan (which encompasses three made up of the President and two Vice-Presidents,
governorates or provinces under the Kurdistan elected by the COR; the Prime Minister, selected
Regional Government) and the 15 governorates that by the President from the COR; and his Council of
were not incorporated in a region. Ministers, drawn from COR. The judiciary consists
of the Higher Judicial Council entrusted with
BOX 2.1: REPUBLIC OF IRAQ overseeing the judiciary and the Federal Supreme
The Republic of Iraq is a single federal, independent and Court, which will be the highest judicial tribunal in
fully sovereign state in which the system of government is the country with significant and expansive judicial
republican, representative, parliamentary, and democratic review authority.
and this Constitution is a guarantor of the unity of Iraq.
Constitution, Article 1 BOX 2.2: FEDERAL AUTHORITIES
The federal authorities shall preserve the unity, integrity,
Federal Government independence and sovereignty of Iraq and its federal
The federal government is organized under three democratic system.
branches: legislative, executive and judicial. The Constitution, Article 109
Council of Representatives (COR), the popularly
elected national legislature, and the Federation
October 2007
The Constitution vests the federal government BOX 2.3: FEDERAL SYSTEM
with exclusive authority and powers that it shares The federal system in the Republic of Iraq is made up of
with the regions and with the governorates not a decentralized capital, regions and governorates, as well
incorporated in a region. as local administrations.
Figure 1. The Three Branches of Federal Government Constitution, Article 116
JUDICIAL LEGISLATIVE EXECUTIVE The Constitution expressly recognized Kurdistan as

a region, validating the special status given to this
Higher Federation President
entity under the CPA. Other regions may be formed,
Judicial Council Council by one or more governorates. The Constitution gave
Vice President (2)
the regions the right to adopt a constitution of
their own that would define the institutions and
authorities and structure of powers of the region
Council of Ministers
Federal Supreme COR Prime Minister
concerned, provided such arrangements do not
Court
contradict the Constitution or the exclusive powers of
the federal government.
Other Federal Federal offices in
Courts Governorates
As far as the governorates outside a region are
concerned, the Constitution offers few details of
Sub-National Governance their institutions and authorities. The governorates
are granted broad financial and administrative
The structure of sub-national governance is authorities that would enable them to manage
organized at two levels, regions and governorates their affairs in accordance with the “principle
not incorporated in a region. Baghdad, the capital, of decentralized administration.” Each of the
became the new “capital territory,” formed within the governorates would have a governorate council with
municipal boundaries of Baghdad; its governance is independent finances, and they would not be subject
to be determined by implementing legislation. to the control of the central ministries. The governor,
10 Republic of Iraq District Government Field Manual
elected by the council, is to be the highest executive The Constitution does not identify the governance
official within each governorate. The details of all institutions below the level of the governorate.
these features of governance were to be determined
Chapter 3. Constitutional Mandates In
by implementing legislation.
Iraqi Governance
The Constitution vested specific and general
authorities upon the regions and governorates Overview
outside the regions. They had powers shared with
• Four fundamental constitutional principles are
the federal government and were entitled to receive
identified as constitutional mandates in Iraqi
equitable shares of the national revenues. They were
governance.
the recipients of all powers not entrusted on an
exclusive basis to the federal government. A number of fundamental constitutional principles
are enshrined in the Constitution. Of these, four
Figure 2. Sub-national Government
merit special notice in this manual; they may
JUDICIAL LEGISLATIVE EXECUTIVE legitimately be identified as constitutional
mandates in Iraqi governance (see Box 3.1):
Prime Minister
Regional KRG
Judiciary? Parliament Cabinet
BOX 3.1: CONSTITUTIONAL MANDATES
Governorate Governor “Constitutional mandates in Iraqi governance” are
Councils (3)
derived from the fundamental principles enshrined in the
Local Councils Administrator 2005 Iraqi national Constitution. These mandates are
(Municipal Councils)
significant for they underlie, separately and collectively,
Governorates Governor the entire Iraqi governance structure and the institutions
Council (15)
and authorities embedded in it. In essence, institutions
Qa'im
District Councils Qada’a Maqam of governance should be validated with reference to
Subdistrict Councils Nahiya these mandates.
Mudiyar
Neighborhood Councils Hayy
Capital Territory (Baghdad)

October 2007 11
1. Supremacy of the Constitution: 3. Decentralization:
“This Constitution is the preeminent and supreme “The federal system in the Republic of Iraq is
law in Iraq and shall be binding on all parts of made up of a decentralized capital, regions and
Iraq without exception” (Article 13 – First). governorates, as well as local administrations”
“No law that contradicts this Constitution shall be (Article 116).
enacted. Any text in any regional constitutions
4. Democracy:
or any other legal text that contradicts
this Constitution shall be considered void” “The law is sovereign. The people are the source
(Article 13 – Second). of authority and legitimacy, which they shall
exercise in a direct, general, secret ballot and
2. Separation of Powers: through their constitutional institutions”
“The federal powers shall consist of the legislative, (Article 5).
executive and judicial powers, and they shall
exercise their competencies and tasks on the
basis of the principle of separation of powers”
(Article 47).

PART II
Chapter 4. Framework of Sub-National 2. CPA Order 71 has not been uniformly
Governance implemented:
• Some Iraqis contend that Order 71 is the
A. CPA ORDER 71 product of an occupying power and as such is
1. Order 71 on local governmental powers remains not deserving of respect.
the basic framework law for sub-national • Security issues have precluded the working out
governance, until the COR enacts a new law of particular aspects of Order 71 in some areas.
for governorates pursuant to the Constitution’s
• Certain provisions of Order 71 undermine the
directive for implementing legislation. It is not
popular basis that it sought to introduce for
applicable to the Kurdish Regional Government.
governance.
BOX 4.1: ORDER 71: PURPOSE • The interventions of individual CPA officials
By appropriately empowering government bodies at the
at the governorate level— for example, opting
governorate, municipal and local levels, the Order [71] to refresh the memberships of councils
is designed to improve the delivery of public services to —undermined the credibility of the measure.
the Iraqi people and make the Iraqi government more • The decentralization principle embodied in
responsive to their needs. This Order encourages the Order 71 has not won favor at the center,
exercise of local authority by local officials in every region and indeed, decentralization in general has
and governorate”.
been overtly resisted by the Ministry of
Order 71, Section 1 Finance (MOF) and Ministry of Planning and
Cooperative Development (MOPCD).
October 2007 13
3. Despite the problems in the working of the 6. Order 71 does not provide for the election of
Order 71, it established the formal contours of chairmen by the governorate councils, but in
sub-national governance. practice, such officers are in place in all the
councils. Many of the councils have adopted
B. GOVERNORATE-LEVEL AUTHORITIES bylaws that govern their internal proceedings.
Governorate Council 7. The governorate councils have policy-making and
4. Order 71 formalized the structure and role of the supervisory powers. These include
governorate councils in governance. As conceived • Setting priorities for the governorate;
by Order 71 and the Constitution, this council • Amending a specific local project described in
is the highest elected body in the governorate, an annual ministry budget without increasing
the principal administrative unit in sub- the set spending limits or efficient execution of
national governance in Iraq. Its independence national objectives set forth;
from the central ministries was granted by both
• Monitoring and recommending improvements
instruments, and under Order 71, it was to be
in the delivery of public services;
funded by a national budget allocation. The
national funding continues to be the primary • Representing the concerns of constituents;
revenue source for the councils. • Independently generating and collecting
5. The Elections Law of 2005 introduced the revenue by imposing taxes and fees;
principle of popular elections for the membership • Organizing the operation of the governorate
of the governorate councils (41 for each, with 51 administration;
for Baghdad). The elections for the councils were • Initiating and implementing provincial
held on 30 January 2005 coinciding with the projects alone or in partnership with
national elections. nongovernmental organizations (NGOs) and
international organizations;

• Playing a role in the appointment and removal the governor. One of the primary impetuses for
of directors general (DGs) of the national this development came from the MOF decision
ministries and senior federal officials; and to require the establishment of, at the minimum,
• Establishing subcommittees and taking spending units in each governorate that
testimony of and requiring reporting by DGs. would engage in the utilization of Accelerated
Reconstruction and Development Project Funds
Governor (ARDF) transferred and placed under the control
8. Order 71 authorized the governorate councils of governorate councils under the 2006 national
to elect governors and deputy governors. budget. In all governorates, more than the
The governors and deputy governors may be minimum has been met.
removed for cause, defined as incapacity, serious
misconduct in or out of office, dereliction of duty, C. LOCAL-LEVEL AUTHORITIES
or abuse of office. Qada’a and Nahiya Councils
9. The governor is the chief executive official of the 11. Below the governorate are two formal
governorate, responsible for the implementation administrative units: qada’as (districts) and
of the decisions of the governorate council and nahiyas (subdistricts) within each of the qada’as.
accountable to that body. The governor has the Qada’as and nahiyas have governing councils.
authority to appoint administrative officials, Each nahiya incorporates hayys, or neighborhood
subject to the approval of the council, and the councils. However, hayys are of significance
sole authority remove them. in formal governance only in Baghdad (see
10. Order 71 does not address the subject of a Chapter 5:14). There is no symmetry in the
governorate administrative structure, separate presence of these councils within a governorate,
and distinct from the federal presence. However, either in terms of their numbers or geographical
in virtually all governorates such a mechanism extent and population distribution.
has come into being under the executive office of
October 2007 15
12. Order 71 provides that qada’a and nahiya • Recommend appropriate action to the
councils—local councils hereafter—in the governorate councils with respect to officials
administrative units of qada’as and nahiyas on matters such as misconduct.
may be established by the governorate councils
Qa’im Maqams and Mudiyars
on the basis of majority vote to achieve greater
efficiency and economies of scale and coordinate 15. Qa’im maqams and nahiya mudiyars are the
provision of service delivery. executive officials of the qada’as and nahiyas,
respectively.2 They are elected by the majority
13. The members of each local council and their
vote of the local council and may be removed for
respective chairmen are to be selected in
cause by these bodies; the definition of cause is
accordance with regulations approved by the
the same as that applicable for the removal of the
majority of the governorate council.
governor by the governorate council (see 8).
14. These bodies are vested with the following
16. Qa’im maqam and nahiya mudiyar are
authorities:
responsible for implementing the decisions of
• Represent the constituents; their respective councils and serve as the primary
• Ensure that service delivery responds to liaison between their council and the governor.
local needs; They are also authorized to appoint the local
• Organize operations of local administrations; officials subject to approval of their councils.
• Review local ministry plans; D. BELADIYA
• Collect and retain local revenues, taxes, 17. The beladiyas owe their existence to the Beladiya
and fees; Administrative Law No. 165 of 1964. They are an
• Identify local budgetary requirements through integral part of the outreach of the Ministry of
the national budgetary process; and Municipalities and Public Works (MOMPW) in
2 Order 71 collectively identifies the executive officials of local councils as
“mayors.” This is inappropriate and misleading.

the governorates. The beladiyas are the executive 1. The recent history of the governance in Baghdad
offices of MOMPW at the sub-national levels, is quite complicated. The make-up of Baghdad
and their operations are critical to the sub- governance is owed to disparate sources: the
national governance. MOMPW, although the Constitution, pre-Constitution legislation that
most prominent, is not the only federal presence dates back as far back as 1964, and custom. All
within the governorates. A variety of central of this means that Baghdad governance is unlike
ministerial agencies function in the governorates. that of any other governorate in Iraq.
Their role is examined in Chapter 6. 2. For governance purposes, Baghdad is currently
Chapter 5. Special Case: Baghdad divided into two distinct entities: governorate
Governorate and Amanat and Amanat, with the boundaries of the Amanat
in the interior urban core demarcating the
Figure 3. Baghdad Governorate and Amanat Territory two. The Amanat’s original boundaries were
established by the Baghdad Master Plan Law
AL TARMIYA No. 151 of 1971, although these boundaries have
been adjusted more recently. The governorate
AL TAJI AL ISTIQLAL and Amanat have their own unique roles and
institutional arrangements, share in common
BAGHDAD
institutions, and are linked at different
ABU GHURAIB
administrative and political levels by other
MADA’IN
institutional mechanisms.
MAHMOUDIYA
Note: Amanat territory marked “Baghdad.”

October 2007 17
A. GOVERNORATE AND GOVERNORATE COUNCIL Al Tarmiya, Abu Ghuraib, Al Istiqlal, and Al Taji
(see map). Al Istiqal and Al Taji became qada’as
Baghdad Governorate
in April 2003; prior to that, they functioned
3. The Baghdad Governorate is one of the 15 as nahiyas that came respectively under the Al
governorates in Iraq that are treated separately in A’dhamiya qada’a and Abu Ghuraib qada’a, which
the Constitution as governorates not incorporated form part of the Amanat.
in a region. Thus, it shares the same institutions
5. Although now separated, Al Istiqal and Al
and authorities as the other governorates outside
Taji continue to be linked to their original
a region, as well as certain rights, such as the
administrative units; their administration
right to establish itself as a region following
continues to be directed respectively from Al
the constitutional requirements. Like other
A’dhamiya qada’a and Abu Ghuraib qada’a. This
governorates, Baghdad is subject to Order 71.
arrangement means that they do not have qa’im
Yet, since it is linked to the unique institution
maqams; nahiya mudiyars remain their executive
of Amanat, the Baghdad Governorate is also
officials. The other qada’as have qa’im maqams as
characterized by institutional arrangements that
their principal executive officials.
are not replicated elsewhere in Iraq.
6. Except for the two councils created in 2003, the
4. The Governorate of Baghdad as an administrative
qada’a councils of the governorate pre-date the
unit is best identified by listing the qada’as that
regime change in 2003. Under the CPA, they
are incorporated within it. In general, these
were re-defined as advisory councils with new
qada’as are known as the outer qada’as since
members nominated by citizen caucuses; the
they form a ring around the administrative areas
two new councils emerged as advisory councils,
under the Amanat. Six qada’as come under the
as well. This was also the experience of the local
Baghdad Governorate: Mada’in, Mahmoudiya,
councils elsewhere in Iraq. Similarly, the qada’a

councils of the governorate were re-defined again as distinct from the federal offices in the
with the coming into force of Order 71. governorate; this apparatus had begun to take
shape even before the council was entrusted with
Figure 4. Baghdad Governorate Qada’as
the task of utilizing ARDF transferred to it by
MOF, and now there is a notable presence of the
governorate administration.
Abu Mada'in Al Tarmiya Mahmoudiya Al Taji Al Istiqlal
Ghuraib Qada’a Qada’a Qada’a Qada’a Qada’a 9. The Baghdad Governorate Council took over
Qada’a (With 1 (With 1 (With 1 (2003) (2003) from the Baghdad City Council, which was
(With 1 Qa'im Qa'im Qa'im (Admin- (Admin-
Qa'im Maqam) Maqam) Maqam) istered by istered by dissolved when the governorate council was
Maqam) Al A'dhamiya Abu Ghuraib
Qa'im Qa'im established. The Baghdad City Council had come
Maqam) Maqam)
into existence under the CPA in February 2004;
this council had 46 members, the majority of
7. The history of the nahiya councils of the whom were chosen under the caucus system, and
governorate followed the same path as that of its this was viewed by CPA as providing it with a
qada’a councils. representative character. The dissolution of the
Baghdad City Council may properly be viewed
Baghdad Governorate Council
as a successful power play on the part of the
8. Baghdad Governorate Council formally came Baghdad Governorate.
into existence after the nationwide elections
10. Two other councils were in existence at the time
for governorate councils on 30 January 2005. It
the governorate council began functioning. The
consists of 51 members and a chairman elected
first was the Baghdad City Council that was
from the council members. It has drafted bylaws
established by the Coalition in July 2003 with
and established and regularized its internal
37 members; its primary responsibility was
proceedings, including the establishment of
service delivery. In March 2005, the governorate
committees devoted to specialized subjects. It
has developed its own administrative apparatus,
October 2007 19
council dissolved the Baghdad City Council and 13. The Constitution requires implementing
established in its place the Baghdad Services legislation for the government of the capital
Commission. The second body was the Baghdad territory. If and when this is accomplished, it will
Regional Council with membership drawn from likely have an impact on the Amanat’s role as an
all the outer qada’as, and it was dissolved in administrative entity, as well as dramatically and
June 2007 with the Baghdad Outskirts Service radically transform the current arrangements
Commission replacing it. in place for linkages between governorate and
11. The governor, elected by the governorate council, the Amanat.
functions as the governorate’s chief executive
C. AMANAT
official with powers vested in him under
Order 71. 14. The Amanat is an administrative entity and has
no elected body solely attached to it, although it
B. BAGHDAD AS THE CAPITAL is linked to the governorate council by the fact
12. The geographical area of the Baghdad that its principal executive official, the Amin,
Capital Territory created by the Constitution is appointed by that body and is accountable to
corresponds to the area that comes under the it. Incorporated within the Amanat are hayys
Amanat. The capital territory is a unique entity, as subsidiary administrative units. Nahiyas, the
and under the Constitution, it is separated from standard administrative unit below qada’as, are
the governorate. It is also not permitted to join absent in the Amanat. Thus, hayy councils take
a region—in other words, it will not become a the place of the nahiya councils with respect to
part of the region of Baghdad, if Baghdad realizes administrative affairs.
its aspiration to politically and administratively
transform itself.

Figure 5. Baghdad Amanat: Administrative Structure BOX 5.1
AMANAT USAGE GOVERNORATE USAGE
AL AMIN
Kati’ Council Qada’a Council
Hayy Council Nahiya Council
Technical Municipal Administrative
Deputy Deputy Deputy 16. Currently, the following kati’s together form the
administrative entity of Amanat:
Municipal Affairs Administration and
Technical Affairs
13 Beladiyas Finance Office • On the Risafa (east) bank of the Tigris
Water Office River (5): Al Sadr, Al A’dhamiya, Al Risafa,
Administration Real Estates
and Finance Office Al Karrada, and 9 Nissan. Al Karrada and 9
Sewage Office
Accountancy
Nissan were established as kati’s in April 2003.
Production Office • On the Kharkh (west) bank of the Tigris River
Warehouses
(4): Al Kharkh, Al Khadhumiya, Al Mansour,
Projects Office
Personnel and Al Rashid. Al Rashid and Al Mansour
Affairs
Designs Office became kati’s in April 2003.
Legal Affairs
Planning and 17. Although geographically separated by the river,
Follow-up Office
Public
Relations
the kati’s on its two banks are administratively
linked. Since their establishment, the two
kati’s of Al Karrada and 9 Nissan have been
15. In 2003, the Coalition authorities introduced a administratively annexed to Al Risafa kati’.
new terminology to Amanat governance. This Similarly, after establishment, the kati’s
terminology continues to be used as custom, even of Al Rashid and Al Mansour have been
though it has no legal basis. Thus, the Baghdad administratively linked to the Al Kharkh kati’.
Governorate and Amanat reference different Thus, these four kati’s do not have their own
entities in terms of governance (see Box 5.1). qa’im maqams, unlike the rest.
October 2007 21
18. Another unusual arrangement in the Amanat 21. The legal basis for the expansive authority
is the appointment of two qa’im maqams that the Amanat qa’im maqams enjoy is the
for Al Sadr. Al Sadr is a sprawling, densely Governorates Law No. 159 of 1969. Order 71 in
populated district. fact suspended this law, as it did other existing
19. The Amanat’s main responsibility is to deliver laws, to the extent they were inconsistent with it.
services to the administrative units within its However, there has not been any formal judicial
boundaries pursuant to two pre-Constitution adjudication as to which provisions, if any, of
laws, Law No. 151 of 1971 and Law of Amanat the 1969 law are inconsistent with Order 71.
Baghdad No. 16 of 1995. In strict terms, the Thus, the qa’im maqams of the Amanat continue
activities are limited to its territorial coverage, to function with the authority they had under
but the fact that some of its kati’s are linked the Law No. 159 of 1969. In addition, they also
administratively with qada’as belonging to the exercise authority granted by Order 71.
governorate has meant that faithful adherence Figure 6. Baghdad Amanat: Kati’s
to this restriction has not been followed.
The Amanat has responsibilities beyond
AL KHARKH AL RISAFA
service delivery, such as the development and KATI’ KATI’
implementation of projects.
20. The role of the kati’ qa’im maqams as the Al Kharkh Al Khadhimiya Al Risafa Al Adhamiya Al Sadr
principal executive officials is significantly (with 1 (with 1 (with 1 (with 1 (with 2
Qa’im Qa’im Qa’im Qa’im Qa’im
different from those of the qa’im maqams of Maqam) Maqam) Maqam) Maqam) Maqams)
the governorate, and indeed, those in other

qada’as in Iraq. Unlike the qa’im maqams of the Al Rashid Al Mansour Al-Karrada 9 Nissan
governorate, who are constrained by Order 71,
the kati’ qa’im maqam act in accordance with
custom on the basis of the original powers
granted to the official in 1969.
Chapter 6. The Federal Presence 2. The table below provides information on the
1. This chapter describes the way that federal presence of the federal ministries in general in
authorities radiate and function at the sub- the qada’a and nahiyas.
national level.
Table 1. Qada’as and Nahiyas: Federal Ministry Presence
Governorate Level Qada’a Level Nahiya Level

Ministry of Finance
Retirements Directorate None None
Governmental Real Estate Directorate None None
Commission for Taxes None None
Treasury Directorate Treasury Branch Treasury Branch
Ministry of Interior
Nationality Directorate Nationality Branch Nationality Branch
Civil Defense Directorate None None
Police Directorate Police Directorate None
Traffic Police Directorate None None
Ministry of Labor and Social Affairs
Social Care Department None None
Labor and Social Security Department None None
Ministry of Health
Health General Directorate None None
October 2007 23
Table 1. Qada’as and Nahiyas: Federal Ministry Presence (continued)
Governorate Level Qada’a Level Nahiya Level
Ministry of Education
Education General Directorate None None
Ministry of Youth and Sport
Youth and Sports Directorate Youth and Sports Branch None
Ministry of Municipalities and Public Works
Construction Planning Directorate None None
General and Local Administration None None
Water Directorate Offices at production site None
Sewage Directorate Offices according to own None
territorial scope
Municipalities General Directorate Municipality Municipality
Ministry of Agriculture
Agriculture Directorate Agriculture Section Agriculture Section
Ministry of Water Resources
Irrigation Directorate Irrigation Section Irrigation Section
Ministry of Planning and Development Coordination
Statistics Directorate None None
Ministry of Environment
Environment Directorate None None

3. Each central ministry has a distinctive way to A. MINISTRY OF MUNICIPALITIES AND PUBLIC
deliver the services it covers. In addition, there is WORKS
no uniformity in the way these ministries radiate 4. The MOMPW has three directorates at the
to the governorates. The offices are identified governorate level: Municipalities, Water, and
as governorate general directorates (in essence, Sewage. As examples, two of these directorates
offices headed by DGs), although in formal terms are discussed below.
only the offices of the ministries of Finance,
5. Municipalities Directorate:
Education, and Health and the MOMPW are
ranked as general directorates (commonly called The basic functions of this directorate are
also DGs in the governorates). The relationship of • Surfacing and maintenance of roads;
both decentralized and centralized governorate • Building and maintenance of gardens
offices to the central ministries, including with and parks;
respect to the important functions of the drawing
of funds and procurement, varies considerably. • Defining the usage of lands for commercial
The decentralized offices do not enjoy complete and residential purposes, and distribution of
autonomy from the center; what decentralization land among the citizenry either through direct
means here, in general, is that they have a allocation or public sale;
degree of authority to handle administrative • Placement of traffic signals, as well as cleaning
duties that are formally prescribed or deemed of public places and organization of streets;
attributes by custom. • Garbage collection and its safe disposal; and
• Environment controls and actions to prevent
and clean pollution generated by factories and
industrial areas.
October 2007 25
6. The Municipalities Directorate, headed by BOX 6.1: BELADIYA
DG of Municipalities, represents MOMPW Al-Beladiya is a local institution which has a moral
in the governorate and is fully funded by it. character, renders public services and acts in accordance
The DG is responsible for the distribution of with what have been stated in this law and certain
the MOMPW’s budget among the qada’as and other laws.
nahiyas, depending on the area that they serve Law No. 165 of 1964, Article 1
and the deficit between their revenues and
expenditures. Further, the DG reviews all work of BOX 6.2: HOW MANY BELADIYAS? : BASRAH
the administrative unit to ensure that they meet GOVERNORATE
their objectives. Basrah incorporates 15 qada’as, and thus, it has 15
7. Each qada’a and nahiya contains a directorate beladiyas, each one with a department manager and
staff. The total staff in Basrah Governorate Beladiyas in
office, identified as a beladiya, to deliver
2007 is 1,912 employees.
services to the inhabitants of the corresponding
jurisdiction (see Boxes 6.1 and 6.2). As an
8. Capital investment for projects assigned to
executive office of the MOMPW, the beladiya
the beladiyas rarely comes from surpluses in
is a federal office, yet it is also deemed to be
the qada’a revenue collection. They are usually
the administrative offices of the qada’as and
provided by the MOMPW from Baghdad, through
nahiyas. This status permits the beladiya to
its governorate DG. Occasionally, the beladiya
control all revenues authorized to be collected
may become associated with projects promoted
and retained by the qada’as under the Revenue
by the governorate council in the qada’a or
of Municipalities Law No. 130 of 1963 (Law
nahiya. In particular, this occurs when the
No. 130). All beladiyas function under a self-
governorate council delegates to the MOMPW
finance principle approach, but in actuality, they
DG in the governorate the execution of specific
use the qada’a revenues to pay for their respective
projects funded with ARDF (see Chapter 7).
operational expenditures (see also Chapter 7:2).

9. The Municipalities Directorate is responsible for through which funds ultimately reach the Water
managing the work of all beladiyas in the qada’as Directorate sector offices in the governorate.
and nahiyas, and it does so technically and Sector offices in the governorate reach qada’a
financially. Each beladiya should report monthly and nahiya, but the sector’s coverage may include
to the Municipalities Directorate on financial more than one qada’a. In general, Water DG
matters and on the physical progress of its works. sector branches are located near the principal
10. Water Directorate pumping stations.
11. The basic objectives of this directorate are 13. The governorate Water DG’s administrative
structure is given below:
• Pumping and purifying of potable water;
Figure 7. Water DG’s: Governorate Administrative Structure
• Lay out of the water pipeline network; and
• Maintenance of all potable water projects. MANAGER
12. Each governorate contains a governorate Water Finance Dept.
Directorate, headed by the governorate Water Technician

DG, which is directly linked to the MOMPW in Committee
Baghdad. In the ministry office in Baghdad, there Computer Dept.

Planning
is a Ministerial Water Directorate with a DG. This
Management Dept. City Center
constitutes the central office, and the governorate Printer Projects
Water DGs report to the DG at this office. The Inventory
Ministerial Water Directorate is considered a Personnel
Qada’a and
semiautonomous directorate, and this affects the Inward Mall
Nahiya Projects
manner in which it may manage the budget. The Sectors

Audit
Water Directorate in Baghdad receives the budget
Pipe Line
allocations from the MOMPW’s Finance Office, Legal Dept. Property
and these are distributed throughout the country Atelier
through its governorate DGs. This is the process Vehicles
October 2007 27
B. MINISTRY OF FINANCE D. MINISTRY OF EDUCATION
14. The MOF’s branch offices at the governorate 17. There is a DG for Education in the charge of
levels are known as the governorate Treasury the Education Directorate in each governorate.
Directorates. Their branches at the qada’a He is responsible for the implementation
level are known as Treasury Departments. The and management of education programs in
Treasury Departments receive their funds from the respective governorates. There is no DG
the governorate Treasury Directorate, which in representative at the lower administrative units.
turn receives its funds from MOF in Baghdad. In each qada’a, the directorate simply controls
15. The Treasury Departments are responsible for schools and other programmatic activities from
managing all financial matters at the qada’a level, the center of the governorate.
most importantly the tax collection. The Treasury
E. MINISTRY OF HEALTH
DG is in charge of distributing all federal moneys
in the governorate, and his office controls a 18. The Ministry of Health has branches in each
significant share of the financial operations governorate in the form of governorate
and bank accounts of the different public sector Directorates of Health headed by the Health DG.
offices in the governorate. The directorate organizes the delivery of health
services to the inhabitants through hospitals,
C. MINISTRY OF AGRICULTURE clinics, and dispensaries. All health facilities
16. The Agriculture Department of the Ministry of are located at strategic geographical locations
Agriculture at the governorate level has sub- consistent with population density. Every
offices in each qada’a. The qada’a offices manage hospital and clinic has its own budget, which is
the delivery of agriculture services in qada’a and allocated from the governorate directorate on the
nahiya, and they report directly to the head of basis of the rules and releases authorized by the
the governorate Agriculture Department. Ministry of Health in Baghdad.

PART III
Chapter 7. Fiscal: Fiscal Powers and MOMPW in each qada’a. The beladiya may also
Current Intergovernmental Financial transfer surplus revenue collected to any other
Framework administrative unit.
3. In 2003, the CPA empowered the governorate
A. REVENUES
councils by Order 71 to organize governorate
1. In the past, the highly centralized public revenues according to the needs of their
administrative structures in Iraq provided little jurisdictions (see Box 7.1). However, Iraqi
room for fiscal autonomy for qada’as and nahiyas. administrative practice requires implementing
Legislation enacted in 1969 and 1995 took away legislation to detail how these powers will
the attributes of autonomy from qada’as and actually be implemented. This implementing
nahiyas. Even through the centralization process, legislation has not been passed.
however, the right of these administrative
units to collect and retain some revenues was BOX 7.1: GOVERNORATE COUNCILS
maintained. The list of revenue sources for The governorate councils may set priorities for the
the qada’a was long, and their financial weight provinces to independently generate and collect revenues
appears not to have been significant; they did not by imposing taxes and fees…
provide large inflows of money, and moreover,
Order 71, Section 2 (2)
they have been diminishing over time.
2. Sub-national authorities’ development of their 4. The only indisputable revenue attributed to
own administrative structures to handle the the governorates by Order 71 is the so called
assigned revenues was hindered by the central “reconstruction levy” (see Box 7.2); hence, many
authorities. Collection of local revenues has been governorate councils are applying this levy to a
in the hands of the Tax Inspectorate of the MOF variety of transactions. Governorates are also
in all qada’as. Disposition of these moneys is authorized to impose taxes and fees.
closely controlled by the offices or beladiya of the
October 2007 29
BOX 7.2: “RECONSTRUCTION LEVY” BOX 7.3: LOCAL COUNCILS
Notwithstanding existing Iraqi law, governorates are Local councils are responsible for …. collecting and
hereby authorized to impose althma’am of no greater than retaining local revenues, taxes, and fees.
5% of the relevant taxes. Order 71, Section 4 (1)
Order 71, Section 8
7. Revenue-raising powers of qada’as and nahiyas
5. The MOF’s sustained opposition has deterred depend exclusively on legislation enacted by the
governorate councils from becoming more active COR or by the governorate council concerned.
in developing a more comprehensive governorate To date, no governorate council has enacted
fiscal framework. legislation to share revenues with qada’as or
6. Order 71 also authorizes local councils to act attribute new revenues to these bodies. Thus,
with respect to their own revenues (see Box 7.3). the only revenues local councils have are those
While governorate councils can generate, collect, established under the Law No. 130 of 1963. The
and retain revenues, taxes, and fees, local list of revenues of qada’as as stated in this law
councils can only collect and retain revenue but is summarized for budgeting purposes and is
cannot impose measures to raise revenue. This illustrated below.
essentially means that local councils can collect
and retain revenue on the basis of measures
introduced by the governorate councils.

Table 2. Qada’as: List of Revenues beladiya, the executive office of the MOMPW
Some revenue is being collected in the name of local authorities situated in the qada’as. The federal budget
(General Budget 2006) allocates a matching grant to meet the
Number Concept Amount in Iraqi operational cost of the beladiyas. However,
Dinars the matching grant formula implies that the
qada’a levy revenues for 40% of the cost and
3 Other Charges and 4,000,000,000
Duties the remaining 60% be provided by the federal
budget through the MOMPW. In the event that
5 Capital Income 4,000,000,000
a qada’a exceeds the given amount, the matching
6 Rent Income from 15,000,000,000 grant is correspondingly reduced to match the
Municipal Property budgeted amount.
7 Transfers from the 5,952,000,000 9. Some qada’as have collected revenues that are
Federal Budget
more than sufficient to pay the operational cost
8 Charges for 0 of the beladiya. Such qada’as are called surplus
Services municipalities. The MOMPW is entitled to
9 Unclassified 3,000,000,000 transfer the surplus from such qada’as to supply
Income for the needs of the deficit municipalities,
Total 31,953,000,000 those that cannot collect sufficient revenues to
fund the operation of the beladiya. The transfer
Note: US$1 = ID1,200
of surpluses is possible because the beladiya,
which is an office of the MOMPW, controls the
8. In the aggregate, these revenues are insufficient authorized bank account where the collected
to cover the operational costs of the qada’as. revenue is deposited in the qada’a.
The major operational cost of qada’as is the
October 2007 31
10. This transferring of surpluses discourages the B. FUNDING SERVICE DELIVERY
fiscal effort of all qada’as, but it is a national 12. Neither the beladiya nor the local council
policy that qada’as are powerless to change. Prior authorities collect charges or fees for services.
to 2007, some surplus municipalities succeeded The user fees are collected by the offices and
in devoting their surpluses for projects of facilities of the federal ministries that organize
interest to them. the provision of services in qada’as and nahiyas.
11. Although the Constitution reinstates the financial 13. The current structure of charges for services in
autonomy of the governorate administration, no Iraq seeks to make the service self-sustained.
mention is made of the financial situation of the Overall, “self-sustained” is understood to mean
next level of administrative units. The qada’as the ability to pay for operational cost and
and nahiyas remain subject to the authority maintenance, omitting new construction or
of the governorate councils with respect to overhaul requirements.
finances. Also, details have yet to be worked
14. This leaves out of the equation the growth of
out regarding the governorate administration’s
services, traditionally funded from the federal
financial authority, as required by implementing
government’s capital investment budget.
legislation. In absence of legislation that
Building infrastructure that is sustained by
addresses fiscal intergovernmental issues, qada’as
the users is sound policy. However, building
and nahiyas will be well served by continuing
health care and education infrastructure, if
to use the fiscal framework and revenue
left to the local authorities to fund operational
authorizations of Order 71 and a prior law, Law
and maintenance cost, is deemed bad policy.
No. 130 of 1963.
In addition, the infrastructure is built without
consulting the recipient population as to their
priorities regarding services they would like
to receive.

15. Delivery of services by the federal ministries does assets, and no Iraqi public expenditure was
not necessarily correspond to the administrative devoted to them. There have been few funds for
units of governorate, qada’a, and nahiya. maintenance because federal budget resources
Hospitals and clinics follow the population are scarce and dedicated mainly to sustain the
density regardless of the administrative- payroll and the rehabilitation of infrastructure
territorial divisions. Electrical generation built before 2003.
and distribution serves several qada’as or 19. The qada’a and nahiya councils may, under
governorates. Water resources routinely cover Order 71, influence federal offices working on
several qada’as. Elementary and secondary their jurisdictions with respect to investments.
education follow mainly the population density. However, this task has sometimes been
16. Many of the services and facilities, such as delegated to the governorate councils. Local
hospitals, clinics, schools, drinking water councils coordinate the activities of NGOs and
enterprises, or power generation and distribution international donors in their areas.
enterprises, could be self-funding, which would 20. By and large, the original authority that was
entitle them to collect certain fees. This revenue vested by the Law No.159 of 1969 in the executive
is combined with the national budget funds officials of the qada’a and nahiya local councils—
allocated to them by the center. qa’im maqam and nahiya mudiyar, respectively—
17. During the 1990s, the maintenance of most was transferred to local councils by Order 71.
basic infrastructure was postponed, allowing However, in some cases, they have continued
deterioration in the delivery of basic services. to exercise some or all of the original authority
18. The lack of autonomy of local administrative on the basis of delegation from local councils
units meant that infrastructure developed by concerned or from the governor. On the other
donor funds could not be maintained. Iraqi hand, the qa’im maqams, as noted previously,
legislation on public investment precluded continue to exercise the power originally vested
federal agencies from accepting them as public them (see Chapter 5:20).
October 2007 33
BOX 7.4: QA’IM MAQAM AND NAHIYA MUDIYAR 23. The collection of municipal revenues in Baghdad
It is prudent to delegate to the executive branch some capital is in hands of the Amanat. Prior to 2003,
or all of the authorities that local councils received from revenues collected by the Amanat were sizable.
these officials under Order 71, without resigning them That made Baghdad a surplus municipality; it
for good. With respect to the budget, the governor may even transferred fiscal resources to the federal
delegate some of the coordinating tasks to these officials budget. The deterioration of security has left the
as well. Amanat with about one-quarter of the collections
it used to register. The year 2005 was a zero
C. THE CASE OF BAGHDAD AS CAPITAL: collection year due to lack of legal framework
THE AMANAT to support the enforcement of revenues by the
21. Baghdad as a capital has a different constitutional Amanat. Qada’as and nahiyas of Baghdad also
standing than other governorates but since the intervene in the collection of revenues under
implementing legislation that should order its specific circumstances but are required to deposit
administration has yet to be enacted (see Chapter all money inflows in the official accounts of
5: 12-13), the capital is subject to the control of the Amanat.
the governorate council established pursuant to 24. The qa’im maqams and nahiyas of Baghdad
Order 71. continue to exercise some coordinating
22. The Amanat administers the capital (see Chapter functions. Of these, coordination relating to
5: 14-19). Currently, public sector interventions the interventions by federal offices, NGOs, and
in all sectors in the capital are coordinated via international donors are particularly noteworthy.
the office of the Amin or Mayor. The executive 25. The accumulated unattended needs, combined
office of the Amin of Baghdad is the Amanat, and with the growth in demand by the population,
it essentially functions as a commission of the have reduced the impact of investments in
governorate council. In fact, both the Amin and basic infrastructure aimed at providing basic
Amanat are dependent on that council. services in Baghdad. The rehabilitation of

the infrastructure for basic services based on BOX 7.5: THE CASE OF PROVISION OF ELECTRICITY
user fee recovery has proved impossible. The TO BAGHDAD
provision of the services either does not exist or Provision of electricity generates the most indignation in
is substantially deficient, and the users in many Baghdad capital’s population. This failure of government
qada’as are unwilling to pay for it. service has led to a situation in which supply of
electrical power—where available—is in private hands.
26. The major difference in the organization of the Neighborhoods and private groups of citizens have
provision of services between Baghdad capital managed to obtain generators that cover small residential
and Baghdad Governorate is that Baghdad areas. Citizens organize themselves, on their own
Governorate’s qada’as and nahiyas did not benefit initiative, sometimes under the qada’a or nahiya councils
from the concentrated coordination exercised by and in other cases under the hayy councils, and actively
the Amanat upon the intervention of the federal look for subsidized gas or oil that they purchase with
authorities until 2007. voluntary contributions to keep the generators operating.
In 2002, the State-owned enterprise (SOE) for Baghdad
27. Baghdad Governorate’s qada’as and nahiyas work power was able to collect sufficient funds from users’ fees
with the same administrative structure as the to keep the services running 22 hours a day. However,
qada’as and nahiyas elsewhere. This structure is this level of service was sustained by transferring the
the beladiya office belonging to the MOMPW. power away from other provinces to Baghdad. This
The qa’im maqams and nahiya mudiyars function scheme deprived those who should have been the original
on the executive side of the local administration recipients of service.
but with much reduced authority. The main
coordinating authority lies with local councils.
October 2007 35
28. In 2007, the federal government decided in BOX 8.1: QADA’AS AND NAHIYAS: DO THEY HAVE TO
its budget law that all federal ministries could DRAFT THEIR OWN BUDGETS?
perform improvements and work on service The obligation to prepare qada’a and nahiya budgets
delivery in Baghdad without the authorization of is set forth in the Law No.159 of 1969. The current
the Amanat, which had been required in the past. law on financial management—CPA Order 95—defines
governorate budgets but says nothing about the budgets
Chapter 8. Budget: Qada’a and Nahiya of the local councils. Iraqi legal experts agree that, in
absence of new regulations, the duty to prepare local
A. INTRODUCTION budgets as established in Law No. 159 of 1969 remains
1. This chapter describes the process for a donor in place. There is the need to harmonize this law with the
to interact with the qada’as and nahiyas in new legislation on the public budget.
financial terms. It also describes the budgetary As a consequence of this legal imprecision, no qada’a
arrangements that endeavor to make qada’as or nahiya has prepared its own budget. In certain
and nahiyas participants of the public budgetary instances, either the qa’im maqam or the qada’a council
participates in the preparation of the budget request
process of Iraq.
by the beladiya and in that of other federal offices
present in the qada’a. As for the nahiya, sometimes its
authorities—nahiya council or mudiyar—are consulted or
participate in the making of the federal budget for the
offices operating in the qada’a in an effort coordinated by
the qada’a authorities.
More recently, an extensive citizens’ consultation process
on needs and service priorities has been initiated through
the Provincial Development Strategy. The Provincial
Development Strategy aims to channel major federal
capital budget resources according to the needs and
priorities as expressed by the people.

2. Nahiyas have no authorization to generate 4. The advantage of this procedure is clear: the
revenues, but it is possible for a nahiya to community recipient of the service would likely
collect and retain some revenues under legal be interested in preserving these assets. In
authorization. In 2007, the only legal way for a reality, the nahiya and hayy authorities are not
nahiya to start collecting any type of revenues strictly accountable. The best way to ensure the
is to secure authorization from the governorate proper use of these resources by nahiya and hayy
council; any attempt to collect taxes and fees by authorities is through the active involvement
the nahiyas without prior authorization of the of the community in the projects; thus, the
governorate council is illegal. There are no cases community would have a sense of ownership
recorded nationwide of any nahiya collecting in the asset that ultimately results. Under the
revenue under authorization of the governorate current legislation, the nahiya mudiyar is charged
council because the MOF has opposed the with recording these assets in the official books
exercise of most revenue-raising efforts of the of the nahiya and reporting to the relevant
governorate councils. federal entity in the qada’a the donations
3. Regarding donations, the nahiyas are authorized concerned. There have been attempts by the MOF
to assist in initiating and implementing to seize such donations.
local projects alone or in conjunction with 5. Qada’as are authorized to collect and retain the
international organizations and NGOs. Some revenues established under Law No. 130 of 1963.
donors have coordinated projects or given As noted previously (Chapter 7:2), currently the
funds to nahiya authorities to carry out timely revenue is collected by the Tax Inspectorate of
improvements in the delivery of certain basic the MOF, which controls its disposition.
services. The same has happened between hayy
authorities and donors.
October 2007 37
BOX 8.2: IMPROVING THE TECHNICAL CAPACITY AT beladiya may allocate qada’as’ surpluses to
THE QADA’A AND NAHIYA LEVELS IS A LONG-TERM the deficit qada’as. Their limited finance and
CHALLENGE technical staff makes it difficult for qada’a to
Baghdad, with its technically strong Amanat, is unique. undertake technical designs for public capital
Most qada’as do not have an extensive cadre of investment projects. The most likely way a qada’a
technical staff. Typically, the qa’im maqam works with a may obtain technical expertise is by using the
limited—3 to 5—staff paid for by the MOF, and at times, avenues opened to local councils by Order 71:
he outsources services when no permanent staff is
coordinating the actions of the federal offices
appointed to him.
in the provision of public services. Another
Adding staff to the offices of the qa’im maqam requires alternative is outsourcing to a private provider
adherence to all the procedures for hiring federal
the entire technical design of a given project,
employees, which require the candidate to be interviewed
in Baghdad. Creating ad hoc positions to support
but for this, the qada’a needs to have its own
temporary tasks is feasible but needs consultation with financial resources or obtain support from a
the qa’im maqam. In this regard, there is no certainty that donor or a NGO.
staff paid by donors while being trained would be included
Federal Funding
in the official cadres once the training is completed and
the donor aid ends. 7. The most common way a qada’a obtains capital
investment funds is by participating in the
B. CAPITAL INVESTMENT AND THE PROVINCIAL preparation process of the federal budget. This
DEVELOPMENT STRATEGY is a time- and effort-consuming process with
uncertain results. The qada’a must develop
Own Resources strong links with the federal offices in its
6. Surplus municipalities can engage in certain territorial jurisdiction, if there are any, and at
investment projects with their own resources, the governorate. The illustration below shows
but such cases are few, since the MOMPW the way this process was ordered to take place

for the 2007 annual budget. In the illustration, Provincial Funding
the role of the qada’as and nahiyas is illustrated 8. In 2006, thanks to the decentralization process,
as only applying to the identification of needs local council authorities had the opportunity to
from the communities; the technical aspects of receive transfers the federal government. These
investment projects have yet to come within transfers were allocated to the governorates
their competence. under the 2006 Budget Law (the ARDF).
Governorate authorities—governor and
Figure 8. Local-Level Authorities: Obtaining Captital
Investment Funds
governorate council—are charged with managing
Federal Ministries
these transfers, which are relatively sizable,
Approved TO MoF exceeding US$ 100 million per governorate in
many cases. The distribution of these transfers
PC
List of Projects Governorate interest among the local councils within the governorate
Federal
differs from governorate to governorate (see
Governorate Sector Plan Box 8.3). Qada’a and nahiya authorities may try
Council NEEDS
to influence the federal offices in the governorate
with respect to the preparation of the federal
DGs Budget
Governor Request budget, and they can participate in the decisions
DGs
Qada’a NEEDS
related to the listing of capital investment
projects. The list of capital investment projects
that the governorate authorities submit to the
Nahiya Governorate Communities
and Organizations DG Technical
MOF is the key to grantee capital investment in
Teams the qada’a.
October 2007 39
BOX 8.3: PRACTICES RELATING TO THE DISTRIBUTION instructions are being improved and are taking
OF TRANSFERS RECEIVED BY THE GOVERNORATES into consideration the issues and obstacles faced
Babil follows a per capita distribution of the transfers by transfer recipients.
for capital investment. This governorate applies an
adjustment to the per capita distribution to provide further Provincial Development Strategies (PDS)
support to the qada’as that have security problems. 10. International donors have offered help in the
Ninevah has set aside 10% of total transfers for provision reconstruction efforts for Iraq. The donor
of grants to any qada’a or nahiya that is able to present its community requires the design of an articulated
initiative in a viable project with a proper feasibility study medium- to long-term investment program that
and technical design. would guide their decision making. For that
Baghdad Governorate Council uses a consultation process purpose, the United Nations (UN) and MOPCD
with every qada’a and nahiya council to establish needs have launched the National Development
and priorities through the communities. Strategy (NDS). The national strategy becomes
At’Tamin pledges to consult all qada’as in the governorate based on the needs of qada’a and nahiya
before deciding on the final capital investment list of populations through the Provincial Development
projects that the governorate will fund with transfers. Strategy (see 11 below).
11. Under the PDS, the governorates engage in
9. For the governorate authorities and the a process intended to produce the principal
governorate administrative unit authorities, strategic planning instrument that would
the process of participating in decision making guide and inform all planning, budgeting, and
to fund investment projects in the governorate decision making by the respective governments.
is new. The MOF is the regulating body that The process is participatory. It begins with
controls that process. Because these transfers identifying needs and opportunities, followed
are a recent feature of public finance in Iraq, by identifying the strategic development course
the process still presents contradictions that includes an overall community vision,
and confusing instructions. However, the

objectives, and strategies designed to address the controlling instrument for developing and
needs and capitalize on opportunities. These implementing specific programs and projects
process components are incorporated into a and for prioritizing provincial budgeting and
PDS document that, upon incorporation of execution decisions.3
public comments and formal approval by the 12. Table 3 below shows the status of the PDS as
governorate council, is expected to become of October 2007.
Table 3. PDS Status (October 2007)
Phase Tasks Provinces Output

1 Preparatory meeting with PRTs All 18 governorates PDS Guidelines: Provincial Coordination
Development of PDS process guidelines have completed Committee and Sectoral Task Teams
Enhance provincial knowledge of PDS Key development areas
Facilitate provincial stakeholders forum

Selection of key development areas
PDS Formulation Process

2 Assessment of provinces’ socioeconomic profile Except Dahuk, other Provincial socioeconomic profile
Data collection and compilation 17 governorates have Service standards and challenges
completed
Data and sectoral analysis of service standards
and gaps
Compilation of provincial profile
3 Preparation and facilitation of provincial Except Dahuk, other Provincial vision
stakeholders forum 17 governorates have Provincial mission statement
Development of provincial vision completed
Provincial priority issues, goals, and
Development of mission statement objectives
Identification of priority issues with
corresponding goals and objectives
3 The PDS is discussed in detail in the forthcoming LGP publication, Writing

the Future: Provincial Development Strategies in Iraq.
October 2007 41
Table 3. PDS Status (October 2007) (continued)
Phase Tasks Provinces Output
4 Facilitation of inter-sectoral stakeholders forum Except Dahuk Al Provincial strategic objectives
to formulate appropriate strategies Anbar, Diyala, and Strategic objective for each priority issue
Preparation for district and subdistrict Salah ad Din, other 14
governorates completed The PDS document
workshops to discuss priority issues
Complation of prioritized strategies
5 Translation of strategies into projects and 14 governorates List of prioritized projects and programs
PDS Formulation Process

programs have completed; Major activates and timeline
Preparation of project and program document Baghdad, Basrah,
Babil, Diwaniyah, Project/program documents
for prioritized projects and programs
Erbil, Karbala, Kirkuk, Responsible agencies
Identification of resources and cost and budget Maysan, Muthanna,
estimation Najaf, Ninewa, Cost/budget estimate
Identification of agencies responsible for Sulaymaniyah, Dhi Qar,
implementation and Wasit
6 Cost estimation and resource allocation 12 governorates have Prioritized projects

Preparation of annual plan of action completed; Baghdad, Annual Development Plan
Basrah, Babil,
Preparation of annual budget Diwaniyah, Karbala, Annual Budget
Najaf, Kirkuk, Maysan,
Muthanna, Ninewa,
Dhi Qar, and Wasit
Remark: During both phases 5 and 6, the specificity C. BUDGETing for MAINTENANCE
of outputs and outcomes will vary due to the 13. Maintenance expenditures are budgeted on
circumstances in each governorate, as well as the the basis of the instructions and technical
nature of each project, because some projects may assessment of each line ministry in the
need in-depth feasibility studies that may not be governorate. Regular maintenance is budgeted
manageable within the PDS planning period. by the technical offices in accordance with field
reports of the sub-offices and technical staff. 16. To some extent, qada’as and nahiyas have been
In addition, they also budget extraordinary able to use the funding from the transfers
maintenance in the form of major preventive for maintenance. Coordination with the
actions to be undertaken in case of major federal technical offices has been essential for
problems or emergency needs. this undertaking.
14. On many occasions, these efforts conflict 17. In any case, maintenance funding is not the
with MOF overall levels for operations and strength of the budget system in Iraq.
maintenance (O&M). Usually salaries consume
the bulk of MOF funding, and maintenance is D. BUDGET IMPLEMENTATION
left aside. The most common instruction by 18. Local councils have oversight authority on any
the MOF is to prepare budgets by adjusting the investment taking place in their jurisdiction.
previous year’s approved request in accordance Information on work planned by the federal
with a given percentage increase. This base authorities flows to the local authorities,
budget increment does not take into account enabling them to organize their oversight
realistically the need for the maintenance of work. In urban centers this oversight function
essential infrastructure, giving preference is easier to exercise, while in the rural areas
for new investments and disregarding the local authorities generally face the problem
urgent maintenance. of funds and qualified staff to carry out
15. The 2006 transfers to the governorates were split effective oversight.
into “reconstruction funds” and “new investment 19. If the investment project is funded with transfers
funds.” The reconstruction funding provided to the governorate, there is a funding amount
the opportunity to the governorate councils the governorate authorities can use to defray
to devote expenditures to the much delayed the oversight cost. Since the local authorities
maintenance in lieu of waiting for the federal generally lack technical capacity to undertake
ministries to come forward with funds from their
own budget.
October 2007 43
the oversight tasks of complex projects, the 22. In 2007, there are efforts to shift the Budget
governorate council may decide to outsource such Classification and COA from the customary
tasks to the private sector. format followed in Iraq to international
20. Credit is not an option for qada’as and nahiyas. standards. This has resulted in the development
Order 95 does not permit them to resort to credit of a new Budget Classification embedded in COA
in the public sector without the authorization of that is compatible with government financial
the MOF. During 2006, the MOF attempted to statistics standards prescribed by the UN and
recapitalize the regional banks that are State- International Monetary Fund.4 The new Budget
owned enterprises. The move was scrapped Classification and COA make the understanding
because of the many problems the State as a of financial reports easier. During 2007, the new
lender faces and imposes on the financial market. COA is expected to be adopted officially, and
No bond obligations may be legally issued by all public sector offices, including the qada’as
governorates, qada’as, or nahiyas. and nahiyas, would be required to follow that
new template.
E. TECHNICAL FINANCIAL ASPECTS
F. ECONOMIC DEVELOPMENT ISSUES5
21. Regardless of the type of expenditure local
authorities would like to budget or track and 23. From a strictly economic viewpoint, the local
register, they are duty bound to follow the authorities are most likely to be interested in
Budget Classification and the official Chart of diversification. Finding new sources to invigorate
Accounts for the Public Sector (COA) prescribed the existing productive activities or finding new
by the MOF. The qada’as and nahiyas have a duty ones that can help to alleviate poverty in their
to maintain certain official journals, and such communities is important to local authorities.
documentation necessarily should follow the
4 A sample of the new Budget Classification, including the conversion table,
official COA.
will be included in Volume II of this manual.
5 Volume II of this manual will constitute an additional resource on economic
development issues.

24. Micro-credit cooperatives can be multipurpose, G. DONOR RELATIONSHIPS
dedicated to agriculture, or targeted to a 27. To have donor funds reach the chosen qada’a,
specific social group, such as women or widows. nahiya, or governorate, donors need to negotiate
Orientation of micro credit for activities such with the MOF regarding their choices. If no
as improving market facilities or providing agreement with the MOF is reached, then the
machinery or other forms of capital, such as funds may not reach the recipients earmarked by
seeds, pesticides, and fertilizers, though well the donor.
received, have proved to be unsustainable when
28. In 2007, only a few donor sources fund the
loans were not repaid.
qada’as and nahiyas. The U.S. Military provides
25. The best guide to promote economic development multipurpose financial assistance through the
in many governorates may be found in the Commander’s Emergency Response Program
Provincial Development Strategy technical (CERP). The process for defining CERP fund
documents. These documents analyze the usage implies the creation of a Provincial
economic impact of certain activities prioritized Reconstruction Development Council (PRDC) in
by the population. the governorate. Ideally, PRDCs should include
26. The PRT structure offers experts in a number the governorate council, and this body and
of subject areas that may also effectively help PRDC should work harmoniously, but the PRDC
to guide economic development initiatives in structure presents uneven results as governorate
each governorate. authorities have not been fully cooperative. With
the governorate authorities now facing increasing
responsibilities to respond to their constituents,
the need for funding has grown and the dialogue
between them has improved.
October 2007 45
29. The fact that PRDC functions mainly at the the MOPCD is soliciting input from governorate
governorate level has led to a tendency to administrations in furtherance of the National
overlook linkages with the authorities at the local Development Strategy.
levels. It is important that the qada’a and nahiya
authorities be consulted of the initiatives taken. NEGOTIATIONS
30. The U.S. Government’s Iraqi Reconstruction and 32. When donors negotiate with qa’im maqams
Re-Development Funds (IRRF) and successor and nahiya mudiyars while in Baghdad capital
accounts remain an important funding source for or Amanat, it would be a sound strategy also to
the qada’a and nahiya levels. Originally, this fund meet with local councils.
was dedicated to large reconstruction projects. 33. Local councils may delegate the coordinating
Moreover, the indications are that IRRF will authority with respect to donor funds to the
shift to smaller projects in water, electricity, and qa’im maqams and nahiya mudiyars. However, in
sanitation. some qada’as and nahiyas, because of the security
31. The MOPCD is engaged in refining the National situation or the weakness of local councils, the
Development Strategy, which will integrate the qa’im maqams and nahiya mudiyars continue
national and governorate development goals to exercise the coordination authority in the
and coordinate the communications between customary manner.
governorate administrations and agencies 34. Care should be taken to identify who legally
such as the Iraqi Transitional Assistance Office has the authority to negotiate on behalf of local
(ITAO), United Nations Assistance Mission for councils. Anecdotal evidence suggests that there
Iraq, USAID, UK Department for International are individuals who claim to have the proper
Development, and the World Bank, UN Trust credentials but proved to be fakes.
Fund, and individual governments. Currently,

NOTES
October 2007 47

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 Republic of Iraq District Government Field Manual

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 Republic of Iraq District Government Field Manual

 Republic of Iraq District Government Field Manual

Figure 1. The Three Branches of Federal Government Constitution, Article 116

JUDICIAL LEGISLATIVE EXECUTIVE The Constitution expressly recognized Kurdistan as

Capital Territory (Baghdad)

12 Republic of Iraq District Government Field Manual

14 Republic of Iraq District Government Field Manual

2 Order 71 collectively identifies the executive officials of local councils as

“mayors.” This is inappropriate and misleading.

Note: Amanat territory marked “Baghdad.”

18 Republic of Iraq District Government Field Manual

20 Republic of Iraq District Government Field Manual

the governorate, and indeed, those in other

Governorate Level Qada’a Level Nahiya Level

24 Republic of Iraq District Government Field Manual

26 Republic of Iraq District Government Field Manual

12. Each governorate contains a governorate Water Finance Dept.

Directorate, headed by the governorate Water Technician

Baghdad. In the ministry office in Baghdad, there Computer Dept.

manner in which it may manage the budget. The Sectors

28 Republic of Iraq District Government Field Manual

30 Republic of Iraq District Government Field Manual

32 Republic of Iraq District Government Field Manual

34 Republic of Iraq District Government Field Manual

36 Republic of Iraq District Government Field Manual

38 Republic of Iraq District Government Field Manual

40 Republic of Iraq District Government Field Manual

Phase Tasks Provinces Output

Enhance provincial knowledge of PDS Key development areas

Facilitate provincial stakeholders forum

PDS Formulation Process

3 The PDS is discussed in detail in the forthcoming LGP publication, Writing

PDS Formulation Process

6 Cost estimation and resource allocation 12 governorates have Prioritized projects

44 Republic of Iraq District Government Field Manual

46 Republic of Iraq District Government Field Manual

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