Iraq to compensate Arabs to leave Kirkuk

BAGDHAD (Reuters) - Iraq's cabinet has decided to pay compensation to Arab families forced by Saddam Hussein to move to Kirkuk if they leave the northern oil-rich city voluntarily, government sources said on Saturday.

The sources said the cabinet agreed on Thursday to pay Arab families 20 million dinars ($15,000) each and give them a piece of land if they returned to their original towns.

"This decision does not need parliament ratification. It is effective immediately," one government official said.

The move was welcomed by Kurdish officials but angered some Shi'ite and Sunni Arab parliamentarians who, at a news conference in Baghdad, said it violated the constitution.

Sitting on one of the world's richest oil fields and just outside the borders of the largely autonomous Kurdistan region, Kirkuk could become a regional flashpoint. Kurds want to incorporate the city into their region.

Under Saddam, Kirkuk was subject to an "Arabisation" policy that drove many Kurds from their homes and brought in Arabs, mostly Shi'ite Muslims from the south.

A government official said families would be "encouraged" to leave Kirkuk. "No one will be forced to leave, it is voluntary," he said.

Iraq is expected to settle Kirkuk's final status in a referendum by the end of the year although officials have said such a step might increase violence.

Since the U.S. invasion of 2003, many Kurds have returned and Turkmen and Arabs in the city now complain of "ethnic cleansing".