Ali Zuweid’s Political Programme
Proposed legislative package · Health, Social Protection and Family
Pension, Social Security and Social Insurance Reform and System Integration Law
A federal framework connecting existing pension systems without hastily merging their assets, protecting accrued rights, aggregating public- and private-sector service, and reforming future parameters, governance, investment and indexation on an accountable actuarial basis.
Executive summary
Iraqi pension reform starts from an existing framework. Unified Pension Law No. (9) of 2014, as amended, mainly governs state employees and public-sector personnel. The State Employees Pension Fund receives 10% employee and 15% state contributions, with periodic actuarial examination and some public–private service-transfer rules. Workers’ Pension and Social Security Law No. (18) of 2023 significantly expanded coverage of the private sector, informal work and voluntary pensions, adding unemployment, maternity and health insurance branches alongside pensions and employment injuries, and requiring digitalisation and actuarial assessment every three years.
The systems still differ in eligibility, retirement age, earnings bases, financing, minima and administration. Service-transfer mechanisms exist but do not provide a seamless mixed-career system. The joint IMF, ILO and World Bank 2024 analysis described substantial fragmentation and inequity, finding that different sectoral rules weaken labour mobility and increase public pension fiscal pressure. In 2025, the IMF again called for public pension reform and closer alignment with private-sector rules.
POL-81 therefore does not propose repealing Law 18 of 2023 or immediately merging the workers’ and state funds. A single integration and reform law would establish common insurance-record, service-totalisation, inter-fund settlement, sustainability and governance rules, then specifically amend the unified pension and workers’ social security laws. Parametric reform applies to future service while preserving entitlements built through previous service, so sustainability does not confiscate existing rights.
Constitutional and legal context
Article (30) of the Constitution guarantees individual and family social and health security, including protection in old age, sickness, disability and unemployment, with details regulated by law. It supports both pensions and social security without requiring all risks to be administered through one fund.
Unified Pension Law No. (9) of 2014, amended by Law No. (26) of 2019, governs the National Pension Authority, State Employees Pension Fund, contributions, service, entitlements and survivors. The 2019 amendment reduced mandatory retirement age to 60, with exceptions, and changed some benefit conditions. Since 2023, the private sector has operated under the separate, modern Workers’ Pension and Social Security Law No. (18) of 2023, which repealed Law 39 of 1971.
Limited bridges already exist. The unified law permits adding subsequent private-sector service; Law 18 recognises voluntary pensions and in certain cases transfer or recognition of government service. However, these provisions depend on money transfers, differentials and varying conditions, not unified totalisation automatically displaying combined rights for someone working ten years in government and twenty in the private sector without exceptional procedures.
Legislative gap
| Issue | Current position | Proposed response |
|---|---|---|
| Mixed careers | Scattered transfer provisions, conditions and financial differentials complicate movement. | Automatic totalisation with each fund bearing its share and institutions settling between themselves, rather than burdening workers. |
| Rights where employers default | Workers’ law generally links service recognition to paid contributions and allows workers to sue employers. | Recognise proven employment and make contribution debt an employer liability rather than a worker penalty. |
| Sectoral inequality | Wide differences in entitlement age, earnings bases, minima and increases. | Gradual convergence of future rules while protecting previous rights and avoiding immediate merger. |
| State fund sustainability | Relatively generous formula, retirement at 60 and a short earnings reference period; independent studies warn of growing fiscal pressure. | 2% accrual for new service, progressively broader reference earnings, age 63 for new entrants and transparent indexation. |
| Inflation | State-system adjustments have historically relied on separate decisions and allowances. | General annual inflation-linked indexation instead of selective grants. |
| Investment | Investment powers exist, but risk, conflict and disclosure standards need stronger legislation. | Written investment policy, a risk committee, restrictions on related-party dealings, audit and disclosure. |
| Data | Separate systems and databases. | Linked insurance records using national identification, with correction rights and annual statements. |
Proposed legislative policy
Policy has four levels. First, protect existing pensions and every entitlement component earned through previous service. Second, make rights portable through totalisation and inter-fund settlement, without requiring citizens to repurchase their working lives. Third, gradually reform future state-system rules, including new-entrant age, accrual and reference earnings, retaining modern Law 18 rules unless a specific problem warrants change. Fourth, establish common financial and actuarial governance prohibiting unfunded privileges and disclosing treasury support.
Immediate unification is not assumed to be the solution. Funds differ in insured populations, contribution rates, branches and risks; merger may transfer liabilities and create hidden losses. Integration therefore begins with rights, data and settlement, leaving institutional or financial merger to separate legislation after reliable actuarial accounts become available.
Draft Law
In the name of the people
Presidency of the Republic
Pursuant to enactment by the Council of Representatives under Article (61/First) and Article (30) of the Constitution, the following Law is issued:
Pension, Social Security and Social Insurance Reform and System Integration Law
Part One — General provisions and integration
Article (1) — Definitions
For this Law: First Ministry means the Ministry of Finance; Second Ministry, the Ministry of Labour and Social Affairs; Authority, the National Pension Authority; Social Security Department, the Workers’ Pension and Social Security Department; State Fund, the State Employees Pension Fund; Workers’ Fund, the Workers’ Pension and Social Security Fund. Pension scheme: any compulsory or voluntary contributory scheme providing pensions or periodic benefits for old age, disability or death. Insurance record: the electronic record of service and contribution periods, contributory earnings and benefits. Mixed service: contribution or service periods across several schemes. Accrued right: a finally vested benefit or pension component earned through service and contributions before commencement. Inter-fund settlement: financial clearing allocating benefit costs among schemes according to contribution periods and actuarial principles. Actuarial assessment: independent professional evaluation of liabilities, resources and medium- and long-term sustainability.
Article (2) — Scope
This Law applies to federal contributory pension and social insurance schemes, portability among them, and public entities, employers, insured persons, contributors, pensioners and beneficiaries insofar as integration, sustainability, governance and rights protection are concerned. It does not replace non-contributory social protection except for coordination against duplication or supplementation of inadequate pensions under the relevant law.
Article (3) — Objectives
The Law seeks fair, sustainable pension income; public–private labour mobility without lost rights; broader self-employed and informal-worker coverage; reduced unjustified scheme disparities; better collection and investment; published actuarial and fiscal assessment of decisions affecting benefits and contributions; and interoperable insurance records.
Article (4) — Governing principles
Covered entities shall protect accrued rights, equality before law, proportionality between benefits, contribution periods and financing, adequate protection against poverty in old age, disability and death, intergenerational sustainability, separation of fund assets from the treasury with explicit government support, portability, transparency and data protection. Pension privileges must not be created by law without funding.
Article (5) — Protecting previous rights
First: this Law shall not reduce an existing pension or recover benefits lawfully paid before commencement. Second: prior service and contributions retain their legally assigned value when performed; future-service rules may differ only where expressly provided. Third: accrual formulas must not change retrospectively to reduce components earned through prior service.
Article (6) — Existing laws
Unified Pension Law No. (9) of 2014, as amended, and Workers’ Pension and Social Security Law No. (18) of 2023 remain effective, amended only as expressly stated here. Conflicting provisions shall be interpreted to promote portability and insured-person protection. Different administrative bodies shall not bar aggregation or totalisation.
Article (7) — Separating social assistance and insurance
Contributory pensions rest on contributions and assigned financing. Non-contributory poverty and old-age benefits fall under social-protection law. Low pensions may receive means-tested non-contributory supplements without charging pension funds costs unrelated to members’ contributions.
Article (8) — No parallel scheme
No ministry, unaffiliated public entity or public company may establish a new compulsory pension fund outside statutorily regulated schemes. Voluntary professional or association funds are supplementary, not substitutes, and participation does not remove mandatory-scheme rights.
Article (9) — Scheme Coordination Council
A permanent ‘Pension and Social Insurance Schemes Coordination Council’ shall be established without separate legal personality or budget, chaired by the Minister of Finance, with the Minister of Labour and Social Affairs, heads of the National Pension Authority and Workers’ Pension and Social Security Department, and appropriately ranked Planning, Central Bank and Federal Board of Supreme Audit representatives. Pensioner, worker, employer and expert representatives may be invited without voting rights.
Article (10) — Coordination Council tasks
The Council shall approve interoperability and inter-fund settlement rules, review joint actuarial assessments, propose legislation for gradual convergence, adopt common data and disclosure standards, monitor portability, prevent duplicate service credits and coordinate international benefit-portability agreements. Individual entitlement decisions remain with the competent body.
Article (11) — Technical secretariat
The Authority and Social Security Department shall alternate the secretariat every two years using existing staff, without a separate department or posts. Temporary joint data, actuarial, investment and complaints teams may be formed.
Article (12) — Joint actuarial policy unit
The Council shall establish a professional network among existing actuarial units to harmonise fundamental demographic and economic assumptions for scheme comparisons, retaining each fund’s own assessment responsibility. A methodological summary shall publish life-expectancy, wage-growth, inflation, return and sensitivity assumptions.
Article (13) — National insurance record
A linked national insurance record shall be established without merging assets or replacing operational records. The national identity number shall identify persons, with a technical identifier for each scheme. It shall record contribution and service periods, contributory earnings, scheme type, benefits due and inter-fund settlement status.
Article (14) — Periodic insurance statement
Every contributor or employee may obtain a free electronic annual statement of recorded service and contributions, paying entity, data gaps or conflicts, and a non-binding benefit estimate under current law. An in-person route shall serve those unable to use digital services.
Article (15) — Data correction
Persons may request correction of periods, earnings or contributions during or after service. Decisions shall be issued within thirty days; refusals require reasons and a challenge route. Proof of service shall not be time-barred where supported by public or employer records, tax data, bank transfers or other lawful evidence.
Article (16) — Interoperability
Identity, tax, labour, payroll, pension and social security bodies shall exchange minimum necessary data through secure government interfaces. Paper documents must not be required where lawful, technically feasible verification is available from a reliable government source.
Article (17) — Data protection and confidentiality
Earnings, contributions, health, disability and survivor data are highly sensitive. Processing requires a specific lawful purpose, access shall be role-limited, and viewing and changes logged. Commercial or electoral use and disclosure without legal authority are prohibited, with regard to personal-data legislation upon commencement.
Article (18) — Digital-service continuity
The Authority and Department shall maintain continuity, disaster-recovery, backup and periodic cybersecurity testing plans, with alternative application and payment channels during outages. Purely technical failures must not suspend an entitled pension.
Article (19) — Totalisation of service and contributions
Recognised pension service or insured contribution periods across federal schemes shall be totalised for eligibility without double counting. Transfer into one fund is not required to benefit from totalisation.
Article (20) — Mixed service
For careers combining government, public-sector, private-sector and self-employment, eligibility shall reflect all recognised periods. Each fund bears its proportionate benefit share for registered periods under a regulatory formula and actuarial settlement.
Article (21) — Unified payment
Beneficiaries may choose one payment body for pensions from multiple schemes; it shall collect from other funds through electronic clearing. Established beneficiaries shall not bear inter-fund settlement risks or delays.
Article (22) — Financial settlement between funds
On the Council’s proposal, the Council of Ministers shall regulate past-service liability calculation, clearing frequency, reconciliation failures and institutional-delay penalties. Each fund’s assets and reserves remain separate unless a special merger law follows independent actuarial study.
Article (23) — No duplicated periods
A month shall not be counted twice towards one pension entitlement. Simultaneous covered employment shall lead to aggregated or allocated contributions under the relevant scheme up to the insurable ceiling, not service exceeding actual calendar time.
Article (24) — Protection from employer default
Workers shall not lose credit for proven employment merely because employers failed to register or pay contributions. After verifying employment and pay, the Workers’ Fund shall record service and recover debt and fines lawfully from employers, with recourse rights. Workers shall not pay employers’ shares or violation penalties.
Article (25) — Purchasing or completing service
Notional service may be purchased only where law permits and at actuarial cost equal to the present value of expected liability, except expressly treasury-funded statutory social or compensatory credits. Added-service categories and funding sources shall be published annually.
Article (26) — Leaving public employment
Resignation to join the private sector shall not extinguish prior pension service or freeze it in a way preventing later aggregation. Departing employees shall receive a final statement of service, pensionable earnings and contributions, entered in the national record within thirty days.
Article (27) — Entering public employment
The Authority shall recognise insured private-sector, formal or voluntary contribution periods for eligibility. Funds’ shares shall follow settlement rules without requiring workers to pay differences caused solely by varying employer or state contribution structures, unless they purchase additional benefits.
Article (28) — Kurdistan Region coordination
Federal and Kurdistan Regional governments shall pursue reciprocal implementing agreements for totalisation, information exchange and rights settlement under the Constitution, existing laws and reciprocity. Accrued rights in either system remain protected when workers move between them.
Article (29) — Rights outside Iraq
Bilateral or multilateral agreements may totalise contributions, preserve rights and transfer benefits for Iraqis abroad and foreign workers in Iraq under reciprocity and international standards. Fund contributions may leave Iraq only under an effective agreement or law.
Part Two — Reform and sustainability rules
Article (30) — Parametric reform principle
Changes to eligibility age, calculation formulas and accrual rates apply to subsequent service and shall not reduce components earned beforehand. This governs transition towards sustainability without confiscating accumulated rights.
Article (31) — Harmonised actuarial assessment
The Authority and Department shall independently assess each fund at least every three years and jointly assess mobility effects. Within ninety days of approval, an executive report shall publish ten-, thirty- and fifty-year projections, sensitivity scenarios and required treasury support.
Article (32) — No unfunded obligations
Benefit increases, contribution reductions, added service or exemptions creating continuing liabilities require legislation or decisions specifying financing and an independent actuarial estimate. Bodies granting special privileges shall fund costs not generated by ordinary contributions.
Article (33) — Retirement-age review
Eligibility and retirement ages shall be reviewed every five years against healthy life expectancy, contributor-to-pensioner ratios, labour markets and occupations. Age changes require legislation. Studies shall distinguish public-service termination age from social-insurance pension eligibility.
Article (34) — Early retirement
Early retirement shall be voluntary and funded. Post-commencement service components shall receive actuarial reductions reflecting longer payment periods, except for medical disability, occupational injury or treasury-funded special provisions. Insured persons shall see reduction values before accepting.
Article (35) — Deferred retirement
Persons legally permitted to work beyond pension eligibility may defer retirement within statutory limits. Further contributions shall increase benefits actuarially fairly. Deferral confers no employment-retention right contrary to service law.
Article (36) — Reference earnings
Schemes shall progressively calculate benefits from average contributory earnings over longer periods than the final years, reducing manipulation and unfunded jumps. Historical earnings shall be adjusted using an official regulatory index. Transition applies to future service, protecting prior components.
Article (37) — Accrual and ceiling
New-service accrual shall provide adequate, sustainable replacement rates with converging public–private direction. Future-service benefits shall not exceed eighty per cent of reference earnings except statutory disability or occupational-injury cases or previously accrued rights.
Article (38) — Minimum pension
A contributory minimum shall reflect contribution years, minimum wages and living costs. Application shall not reduce existing pensions below the nominal minimum effective at enactment. Any gap between actuarial and social minima shall be covered by explicit treasury transfers, not other contributors’ reserves.
Article (39) — Post-retirement indexation
Pensions shall be reviewed annually and automatically adjusted for official inflation to preserve purchasing power. In exceptional fiscal circumstances, budget law may temporarily cap increases after publishing impacts, accumulated gaps and remediation plans. Selective increases cannot replace a general rule.
Article (40) — Survivors’ benefits
Schemes shall provide eligible survivors’ benefits under harmonised criteria where possible, avoiding unjustified sex discrimination between spouses and protecting children, persons with disabilities and actual dependants. Combined shares shall not exceed the deceased’s entitlement except under a specially funded provision.
Article (41) — Disability and occupational injury
Disability and occupational-injury benefits remain distinct from old-age pensions where financing differs. Updated medical and functional schedules shall apply, with appeals to a medical panel independent of the original decision-makers.
Article (42) — Hazardous or arduous work
Exceptionally hazardous or arduous occupations may receive different ages or contributions by regulation based on occupational and actuarial assessment. Extra cost shall be funded by higher employer contributions or treasury allocations as appropriate. Entity names or job titles alone do not qualify.
Article (43) — Caregiving and maternity
Maternity leave, employment injury and interruptions legally recognised as insured service must not create record gaps. Limited credits for caring for severely disabled children or exceptional care needs may be granted if explicitly treasury-funded without charging non-beneficiaries’ contributions.
Article (44) — Combining wages and pensions
Public wages and pensions shall be coordinated to prevent two fully treasury-funded payments for the same period, with clear exceptions for consultancy, part-time and private-sector work. Pension receipt alone shall not bar private employment.
Article (45) — Special pensions and privileges
New special institutional, office-holder or group schemes require legislation stating objective grounds, cost and funding. Existing special schemes shall be reviewed when amended to align with general principles and prevent duplicate benefits without impairing accrued rights.
Part Three — Amendments to Unified Pension Law No. (9) of 2014, as amended
Article (46) — Actuarial assessment amendment
The assessment frequency under Unified Pension Law No. (9) of 2014, as amended, becomes at least every three years instead of five, by independent actuarial experts or bodies. Executive summaries shall publish unfunded liabilities, cash-flow projections and treasury support needs.
Article (47) — Retirement age for new entrants
Without affecting existing staff, mandatory retirement for first-time pensionable appointments after commencement shall be sixty-three. Existing employees retain the age applicable at commencement unless voluntarily opting into the new scheme. Future changes require legislation and actuarial and demographic assessment.
Article (48) — Age transition rules
Raising new-entrant age does not automatically extend existing employment. Scarce-specialty and special-role rules remain within their limits. Youth-employment and staffing effects shall be reviewed every three years and reported to Parliament with the actuarial report.
Article (49) — Voluntary early retirement for state employees
Early retirement for future service shall use a minimum age, at least twenty contribution years and actuarial reductions for years before standard entitlement age. Already-qualified rights remain protected, with exceptions for disability, employment injury and treasury-funded compensation benefits.
Article (50) — Pension contributions
Existing employee and state rates remain at commencement and may change only through actuarially supported legislation. Both shall be transferred monthly on fixed dates. Arrears shall be separately reported and may not be settled by accounting entries without actual transfers.
Article (51) — Pensionable earnings base
Regulations shall define pensionable earnings through regularly contributed components, preventing final-year increases from allowances not previously subject to contributions. Base expansion applies only to future service unless insured persons and employers pay their past-period shares at actuarial cost.
Article (52) — Replacing service-transfer rules
Public–private transfer provisions throughout the unified law shall be replaced by this Law’s totalisation and settlement rules. Employees shall not pay past-period differences arising from fund contribution structures except to purchase benefits above their entitlement share.
Article (53) — Protecting pre-reform accrual
At commencement, a notional value shall be calculated for prior-service entitlement under existing rules and retained as a protected retirement component. This does not make it payable before eligibility conditions are met.
Article (54) — Future-service formula
Post-commencement service shall accrue annually at two per cent of adjusted reference earnings, capped for this component at eighty per cent. The protected prior-service component shall be added, subject to no-duplication rules.
Article (55) — Future-service reference earnings
For existing staff, future-service reference earnings shall average the final five years’ pensionable earnings beginning at commencement, progressively expanding by one year every two years to ten. New entrants shall use career-average pensionable earnings, revaluing historical pay with an official index.
Article (56) — Ending non-contributory additions for new service
Future-service pension increases shall not be granted solely for academic qualifications or titles without extra contributions. Previously earned increases remain protected. The state may legislatively fund separate social or occupational grants from the budget without charging pension funds.
Article (57) — Ceiling and high pensions
Future-service benefits are subject to Article (37)’s ceiling, without affecting protected prior service. It prevents new privileges producing pensions above reference earnings without explicit financing.
Article (58) — State-system minimum and indexation
Separate minimum adjustments and allowances shall be replaced by minimum-pension and annual indexation rules under Articles (38) and (39). Future general cost-of-living allowances shall be integrated into indexed pensions rather than layered additions with unclear bases.
Article (59) — Reappointment
When pensioners return to pensionable public employment, State Fund payments shall be suspended for that employment period. Recorded rights remain and new service is added on departure under applicable rules. Suspension does not extend to private or professional income unless the law provides otherwise.
Article (60) — Heirs and survivors
Survivor provisions shall align with equality, non-discrimination and protection of minors and persons with disabilities. Regulations shall use government data links where possible to establish continued study, disability or dependency, avoiding repeated documents verifiable electronically.
Article (61) — State Fund board
Two independent members experienced in actuarial work, investment and risk management shall join fund governance through published selection for fixed terms, with conflicts prohibited. One pensioner representative may observe general-policy sessions without involvement in individual files.
Article (62) — Unamended provisions
Other Unified Pension Law No. (9) of 2014 provisions not expressly amended remain effective, read together with this Law’s integration and accrued-rights rules.
Part Four — Amendments and integration of Workers’ Pension and Social Security Law No. (18) of 2023
Article (63) — Preserving the modern workers’ law
Law No. (18) of 2023 remains the legal basis for private-sector workers, informal work, voluntary pensions, occupational injury, unemployment, maternity and health insurance. This Law neither repeals it nor merges its fund with the State Fund.
Article (64) — Non-payment of contributions
Article (32) of Law No. (18) of 2023 is repealed insofar as it denies proven service because of employer non-payment. Proven employment and earnings shall constitute insured service, with contributions and fines recovered from employers. Only workers’ previously undeducted shares may be collected from them, through instalments preserving entitlement.
Article (65) — Voluntary-pension age condition
The absolute maximum age for voluntary coverage is repealed. Any Iraqi below standard eligibility age may contribute. Where available contribution years cannot produce a periodic pension, options for continuation, actuarially permitted service purchase or a statutory lump sum shall be explained beforehand, without promising unfunded pensions.
Article (66) — Service transfer under Article 71
Article (71) and related provisions shall use totalisation and inter-fund settlement instead of requiring complete financial transfer before recognising service. Each scheme shall value service under rules effective when performed.
Article (67) — Self-employed and informal workers
The Department shall provide simplified contribution bands and monthly, quarterly or seasonal payment options, allowing income categories to reflect actual earnings. Traditional employment contracts must not be required where voluntary or informal coverage is legally permitted.
Article (68) — Platform and digital workers
Digital-platform, application and electronic-intermediary workers qualify according to the actual employment or self-employment relationship, not contractual labels alone. The Ministry of Labour shall coordinate classification with modern labour law without duplicate contributions.
Article (69) — Contribution-rate stability
Law No. (18) of 2023 rates remain effective and may change only by legislation following actuarial assessment of formal employment, compliance, benefits and sustainability. Insurance-branch surpluses must not be transferred to non-social purposes outside the Fund.
Article (70) — Workers’ Fund assessment
General actuarial assessment remains at least triennial under Law No. (18) of 2023, with an added published executive summary and separate indicators for pensions, unemployment, occupational injury, maternity and health insurance.
Article (71) — Health insurance and duplication
Workers’ health insurance shall coordinate with health-insurance law and universal coverage. The same person must not pay twice for the same basic benefit. Clearly funded supplementary benefits providing additional coverage may remain.
Article (72) — Maternity, unemployment and occupational injury
Old-age pension reform must not reduce these branches under Law No. (18) of 2023. Separate accounts and disclosure of resources, benefits and reserves shall prevent permanent, undisclosed cross-subsidies.
Article (73) — Foreign workers and agreements
Foreign workers remain subject to Law No. (18) of 2023, international agreements and reciprocity. Exemptions or transfers require effective agreements preventing duplication and protecting accrued rights.
Part Five — Financing, investment and governance
Article (74) — Separate fund assets
State and Workers’ Fund assets are earmarked public assets, not treasury revenue, and must not finance non-pension government spending. Budget borrowing requires market instruments compliant with investment policy and risk limits, on terms no less favourable than those offered to non-government parties.
Article (75) — Government support
Every treasury contribution, subsidy or transfer shall have a separate budget line explaining its purpose: government employer contribution, social minimum, legacy liability or deficit coverage. Unrecorded support is not a permanent fund resource.
Article (76) — Legacy liabilities
Historically granted benefits without adequate contributions shall be separately analysed, with statutory costs borne by the treasury rather than hidden in contributory results. Legacy liability balances shall be published annually.
Article (77) — Reserve policy
Each fund shall set appropriate operational and strategic reserves through actuarial assessment and a recovery plan if they fall below target. No fixed statutory reserve is set because suitability depends on cash flows, demographic maturity and scheme type.
Article (78) — Investment policy
Each board shall adopt written objectives, horizons, risk limits, strategic asset allocation, liquidity, diversification and environmental and social governance criteria where relevant to returns and risks. Priority is benefit-payment capacity and risk-adjusted returns, not politically motivated projects.
Article (79) — Prohibited investments
Funds must not invest in instruments lacking independent valuation, lend directly to board members, officials, relatives or materially interested companies, buy related-party assets without independent valuation and competition, or provide guarantees unrelated to their purposes.
Article (80) — Investment and risk committee
Each fund shall have financial and actuarial expertise independent of executive management reviewing policy compliance, concentration, liquidity, credit and market risks. Reports shall go quarterly to boards and annually to the Board of Supreme Audit.
Article (81) — Custody and valuation
Investment decisions shall be separated from custody and valuation where possible, using custodians or institutional banking arrangements against embezzlement and manipulation. Assets shall follow recognised accounting standards, with non-traded valuation methods disclosed.
Article (82) — External investment managers
External managers may be competitively appointed where needed under clear performance, risk and fee criteria. Outsourcing does not remove board fiduciary responsibility. Names, mandates and total fees shall be published annually unless a specific commercial detail is legally protected.
Article (83) — Domestic investment
Funds may invest in Iraqi instruments and projects passing financial, risk and governance assessment without reliance on unpriced political guarantees. Administrative decisions shall not earmark compulsory allocations to particular projects.
Article (84) — Debts and arrears
Public-body and employer contribution arrears shall be published monthly or quarterly by entity, value and age without personal data. Collection plans are required, and principal contributions deducted from workers must not be waived.
Article (85) — Joint annual report
The Council shall annually compare contributors, beneficiaries, coverage, contributions, benefits, government support, returns, administration costs and inter-scheme mobility, reporting to the Council of Ministers and Council of Representatives and publishing publicly.
Article (86) — Oversight and audit
Funds are subject to the Federal Board of Supreme Audit and independent annual external financial audit under legal frameworks. Each shall publish audited statements, opinions, oversight findings and remediation plans for material findings.
Article (87) — Conflicts of interest
Board chairs, members and senior management shall file annual interest declarations and abstain from related decisions. Gifts or benefits from investment or contracting counterparties exceeding lawful limits are prohibited.
Article (88) — Procurement and contracts
Fund procurement and technology, consultancy and investment-management contracts shall follow government procurement law, transparency and competition rules. Material contracts and awards shall be disclosed, protecting narrowly defined commercial secrets.
Article (89) — Performance indicators
The Authority and Department shall publish processing times, electronic completion rates, successful objections, data gaps, contribution collection and administration-cost-to-benefit ratios. Indicators must not become grounds for denying established rights.
Article (90) — Whistleblower protection
Secure channels shall report manipulation of contributions, pensions, investments or data, applying protections under existing integrity and whistleblower legislation or its replacement.
Part Six — Rights, grievances, implementation and final provisions
Article (91) — Reasoned decisions
Registration refusal, service exclusion, contributory-earnings determination, pension denial or suspension and recovery decisions shall be written or electronic, stating reasons, facts, legal basis, challenge route and deadline.
Article (92) — Administrative objection
Persons may object within sixty days of notification to a committee functionally independent of the original unit, deciding within forty-five days. Late objections may be accepted for legitimate excuse or defective notice.
Article (93) — Judicial appeal
Administrative objection does not remove court access, with jurisdiction under existing law. Litigation shall not suspend undisputed benefit portions.
Article (94) — Recovering undue payments
Good-faith recipients face recovery only after reasoned decisions and objection rights. Monthly deductions shall be proportionate and preserve decent living standards. Fraudulent payments shall be fully recovered with legal accountability.
Article (95) — Employer violations
Deliberate non-registration, under-declared pay or withholding contributions is punishable under Law No. (18) of 2023, with repetition aggravating the offence. Pension clearance may be linked to licence renewals and public contracts under law.
Article (96) — Public employee responsibility
Intentional alteration of service, earnings, benefits or beneficiary data for unlawful personal or third-party gain incurs disciplinary, civil and criminal liability. Discipline does not bar recovery or prosecution.
Article (97) — Electronic evidence
Records, signatures and communications from secure government systems are admissible under electronic transactions and signature law, with rights to challenge authenticity and request amendment logs.
Article (98) — Transition plan
Within six months, the Council of Ministers shall approve a plan lasting no more than three years covering the national record, Authority–Department links, settlement, existing staff’s protected-old and new accrual components, data protection, training and beneficiary communications.
Article (99) — No universal re-registration
Pensioners and contributors shall not all be required to start registration anew. Existing data shall migrate and reconcile progressively. Existing payments shall not stop because reconciliation is incomplete without serious individual evidence of ineligibility and lawful procedures.
Article (100) — Regulations and instructions
Within twelve months of commencement, the Council of Ministers shall regulate integration, settlement, indexation and investment. Finance and Labour and Social Affairs ministers shall issue instructions within their powers. Compatible existing instructions continue until replaced.
Article (101) — Commencement
This Law enters into force ninety days after Official Gazette publication, except provisions assigned later dates by the transition plan within three years. Existing benefits, contributions and procedures continue uninterrupted.
Statement of reasons
This Law is enacted to realise constitutional protection in old age, disability, death and unemployment; preserve pensions across public–private movement; reduce inequality without harming accrued rights; address State Fund sustainability; strengthen rather than repeal Workers’ Law No. (18) of 2023; and regulate records, settlement, indexation, governance and investment transparently and actuarially.
Explanatory memorandum
1. Why not merge the funds immediately?
Administrative or financial merger is not an end in itself. Funding rules, branches and insured risks differ; pooling reserves and liabilities before evaluation may conceal unintended cross-subsidies. Functional integration therefore combines records, totalisation, simplified payments and settlement while each fund bears its share.
2. Protecting rights while reforming
Accrual and earnings-base changes apply to new service while preserving previous value. This distinguishes future reform from rewriting the past. Existing pensioners face no downward recalculation; current employees retain protected components and earn new components for subsequent years.
3. Why 2% for new service?
The joint IMF, ILO and World Bank analysis proposed reducing accrual from 2.5% to 2% within a package covering reference earnings, age and minima. The draft applies this rate only to new service with an 80% reference-earnings ceiling, preserving prior accrual.
4. Retirement age
The unified law’s first amendment reduced mandatory retirement to 60. This proposal sets 63 for first-time public entrants after commencement, leaving existing employees unchanged. This softens transition and improves long-term sustainability. Age is not automatically linked to life expectancy; future changes require law and a public study.
5. Private sector and Law 18 of 2023
The modern workers’ law is broader than its predecessor, so rewriting it entirely serves no purpose. Amendments target integration: protection against employer default, removal of rigid voluntary-entry age limits, totalisation and settlement instead of burdensome transfers, and coverage of new work patterns. Unemployment, maternity, occupational injury and health insurance branches remain.
6. Minimum pensions and indexation
Minimum pensions fulfil social as well as insurance functions. If the state raises them above contribution-funded levels, the treasury must transparently finance the difference. Purchasing power should be protected through general indexation, not seasonal grants and unequal allowances reproducing disparities.
7. Investment
Pension funds are not government-project financing vehicles. Investment is acceptable where independently assessed and appropriate for return, risk and liquidity. The draft therefore prohibits political allocation and addresses conflicts, custody and disclosure.
Alignment with existing legislation
| Legislation | Relationship | Action |
|---|---|---|
| Unified Pension Law No. (9) of 2014, as amended | Principal state-employee scheme. | Specific assessment, age, service, future-benefit and governance amendments; other provisions retained. |
| First Amendment Law No. (26) of 2019 | Changed retirement age, benefits and other provisions. | Effects preserved for current staff and prior rights; new age applies only to new entrants. |
| Workers’ Pension and Social Security Law No. (18) of 2023 | Governs private, informal and voluntary coverage and insurance branches. | Retained, amending only default protection, age conditions, service transfer and necessary integration provisions. |
| Labour Law No. (37) of 2015 and its modernised replacement upon amendment | Establishes employment, wages and employer obligations. | Use labour and inspection data to prove service and recover employer debts. |
| Social Protection Law | Non-contributory poverty and vulnerability benefits. | Coordinate low-pension supplementation from the budget, not fund social obligations from insurance assets. |
| Health Insurance Law | Healthcare coverage. | Prevent duplicate contributions for the same basic package and coordinate workers’ health insurance. |
| Legislation on martyrs, victims, political prisoners and other groups | State-funded compensatory benefits. | Separate accounting from contributory insurance, continuing under governing laws unless independently amended. |
Transitional provisions and implementation requirements
| Period | Action |
|---|---|
| 0–3 months | Establish the Council, preserve existing rights and issue temporary instructions preventing service-transfer refusal solely because funds differ. |
| Up to 6 months | Inventory databases, shared fields and arrears; adopt national-number and insurance-record standards. |
| 6–12 months | Pilot unified statements and correction rules; issue inter-fund settlement regulations. |
| 12–24 months | Implement totalisation and unified payments for mixed careers and begin the state scheme’s future-service formula. |
| 24–36 months | Complete tax, labour and identity links; publish the first joint actuarial report and evaluate labour-market impacts. |
Transition must address accounting and technology before interfaces. Pensioners should not visit offices to prove information already held by the state, and funds should not move to one database at once. Systems shall run in parallel until reconciliation and settlement succeed.
Financial and implementation impact
No single reform-cost figure is given because effects depend on contributors’ ages, wages, careers, returns and compliance. Combining data does not combine liabilities. Actuarial assessment therefore precedes contribution changes or unfunded increases.
The principal establishment cost is interoperability, insurance records and electronic settlement. Existing pension, social security and national identity infrastructure can reduce technical and administrative costs. Future-service parametric changes are expected to lower long-term liabilities compared with unchanged rules, but must not reduce existing pensions.
A joint IMF, ILO and World Bank report in 2024 identified growing State Fund imbalances. The IMF’s 2025 report cited estimates that reserves might be exhausted by the end of 2027 without reform, with increasing budget support. These are projections, not substitutes for national actuarial assessment; periodic updated accounts are therefore required rather than legislation built around one fixed figure.
Social increases to minima and low-pension supplements remain possible, but financing is separated: amounts exceeding insured value must appear as treasury transfers, preventing opaque charges on new contributors for general social policy.
Safeguards and oversight
- No reduction of existing pensions or previous-service components.
- Annual insurance statements and data-correction rights.
- No lost service because employers fail to contribute.
- Separate State and Workers’ Fund assets; merger only by law.
- Independent actuarial assessment every three years with published summaries.
- All treasury support shown in budgets and fund accounts.
- Investment governance preventing conflicts and political use of assets.
- Reasoned decisions, administrative objections and judicial appeals.
- Protection of pay, disability and survivor data against use outside lawful purposes.
International and comparative references
Iraq ratified ILO Social Security (Minimum Standards) Convention No. (102) on 22 March 2023. It covers core protection branches and principles of sound administration, adequacy and rights. The draft translates them into separation of contributory benefits and social support, challenge rights, sustainability and data rules.
In April 2024, the IMF, ILO and World Bank jointly analysed Iraq’s fragmented, unequal pension system and the need for comprehensive reform. Options included gradual age increases, lower accrual, broader reference earnings, ceilings, inflation indexation and sectoral convergence. POL-81 follows this direction with two significant policy and legal adjustments: protection of all prior service and no merger of the modern Workers’ Fund into the State Fund before actuarial assessment and separate legislation.
Totalisation, used to coordinate social security across countries and schemes, combines eligibility periods while leaving each institution responsible for its share. It is more suitable than requiring citizens to transfer all funds whenever they change sectors.
Sources and references
- Supreme Judicial Council — Constitution of the Republic of Iraq 2005Article (30) on social and health security, old age, sickness, disability and unemployment.
- Ministry of Justice — Iraqi Gazette issue (4566) of 2019Documents publication of Law No. (26) of 2019, the first amendment to Unified Pension Law No. (9) of 2014.
- University of Al-Qadisiyah — consolidated Unified Pension Law No. (9) of 2014 and amendmentTextual reference for the Authority, Fund, contributions, service, eligibility, formula, transfer and first amendment.
- Ministry of Justice — Iraqi Gazette issue (4734) of 2023Documents publication of Workers’ Pension and Social Security Law No. (18) of 2023.
- Iraqi Legislation Database — Workers’ Pension and Social Security Law No. (18) of 2023Available text on contributions, branches, voluntary pensions, service, digitalisation and actuarial assessment.
- United Nations in Iraq / ILO — Iraq’s ratification of Convention 102Documents deposit of ratification on 22 March 2023 and the Convention’s social-security significance.
- IMF / ILO / World Bank — Toward an Inclusive, Equitable, and Sustainable National Pension System in Iraq (2024)Joint assessment of Iraqi pension fragmentation, sustainability, equity, labour mobility and reform options.
- ILO — published joint study of Iraq’s pension systemAdditional reference for the same tripartite study and inclusion and sustainability principles.
- IMF — Iraq 2025 Article IV ConsultationLatest published assessment used here on public pension reform, private-sector alignment and fiscal-support risks.
Ali Zuweid’s Political Programme — A proposed bill within the Health, Social Protection and Family axis. It is not an enacted law unless constitutional enactment and publication procedures are completed.