Iran budget tampering funnels funds to IRGC and its allies

The speaker of Iran's parliament (Majles), Mohammad-Bagher Ghalibaf, and several other senior figures have secretly tampered with the Islamic Republic's annual budget to push hundreds of millions of dollars towards the Islamic Revolutionary Guard Corps (IRGC) and allied institutions, local media reported.

The institutions that benefit from this covert action function directly under supreme leader Ali Khamenei or the IRGC.

The unprecedented budget tampering, which raised the ire of many Majles members in the administration of President Hassan Rouhani, is the first of its kind in the history of the Islamic Republic.

Observers say this is just the latest example of the regime's rampant economic mismanagement and corruption, noting that never before has a budget bill already approved and passed by the Majles undergone alteration after clearing the parliament.

The Majles passed the annual budget in March, after several rounds of deliberations, and after sending it back for revision by the Rouhani administration in response to representatives' questions and concerns.

But on April 24, 100 Majles representatives wrote a letter to Ghalibaf, decrying what they said were "major changes" he and others had made to the already approved budget.

They accused Ghalibaf and others of engaging in economic favouritism to steer money toward their preferred institutions with little to no oversight from any elected body.

Ghalibaf has previously faced accusations of financial corruption. But the cases have been dismissed without investigation, with observers attributing this to his relationship with Khamenei.

Funds redirected to IRGC

The changes, reportedly made in the final draft Ghalibaf sent to Rouhani, allocate larger amounts to certain organisations.

The revisions allocate some $400 million to the Basij Resistance Force, an IRGC-affiliated paramilitary group that enforces internal security. The Basij has been involved in violent crackdowns and serious human rights abuses in Iran.

A further $145 million is earmarked for the IRGC's Imam Hossein University in Tehran, with a similar amount going to the Islamic Propagation Organisation, an institution tasked with spreading pro-regime propaganda.

The state-backed radio and television broadcasting company, Islamic Republic of Iran Broadcasting (IRIB), as well as a group of cyber activists -- likely affiliated with the IRGC's "cyber army" -- received some $444 million.

The IRIB, whose director is appointed by Khamenei and answers directly to him, is widely perceived to have a regime bias.

Large allocations to institutions including the IRGC, are not unusual. But it is against the norm for senior Majles figures to tamper with the budget after ratification by the Majles and approval by the Guardian Council.

Majles representative Elyas Naderan, a Ghalibaf ally, implied that the changes fulfilled a request by the Guardian Council.

Ghalibaf's advisers say Rouhani supporters are using the budget issue to smear their opponents by misrepresenting "a normal part of the budget process" in Iran.

What has been done, however, is far from the norm, especially as organisations with critical need for funding -- such as the Environment Protection Agency and the Planning and Budget Organisation -- have lost funds, while many underfunded institutions are suffering amid the coronavirus pandemic.

'Illegal' budget tampering

The semi-official Fars News Agency, an IRGC-backed media outlet, accused Ghalibaf critics of "fabricating" the larger numbers.

Fars also accused IRNA, the official news agency that broke the news (and is part of the Rouhani administration), of "trying to distract attention from the real suffering that people are experiencing" under the Rouhani administration.

Under pressure, IRNA issued a retraction, saying the story was an error made by an "inattentive reporter".

As the controversy raged on, Ahmad Tavakkoli, former chairman of the Majles budget committee who now heads an anti-corruption NGO, called on Ghalibaf and his allies to explain how and why the budget was changed.

Any explanation offered by Ghalibaf and his supporters -- if one comes at all -- would likely fail to persuade a public already convinced that officials in Tehran are grifters bent on enriching their own allies.

US-based Iranian journalist Shahin Mohammadi described the actions of Ghalibaf and Naderan as "illegal".

In effect, he said, they tampered with the budget to increase funding for certain institutions "by taking money from other parts of the budget, and they did so after the bill had been voted on and approved by the Majles".

Research by Transparency International, an international NGO that issues an annual index which ranks countries on their perceived levels of public sector corruption, confirms rampant corruption in Iran.

In 2020, Iran ranked 149th out of 180 countries assessed by Transparency International, with the country's judiciary and largest religious endowments ranking as the least transparent organisations in Iran.