Ukrainian deputies are in no hurry to adopt the state budget

Author : Yaroslav Konoshchuk

Source : 112 Ukraine

Voting for the state budget in the second reading might traditionally be a "Christmas tree present" for the Ukrainians
10:14, 10 November 2017

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"We have prepared the budget on time." Prime Minister Groysman and members of the government like repeat this phrase as a mantra. Yes, according to the Budget Code, the draft state budget for 2018 was registered in parliament on September 15, and then Rada accepted it for consideration. However, after more than a month and a half, parliamentarians did not even begin to consider the project of the main financial document in the framework of the first reading procedure.

On Monday at the meeting of the Conciliation Council of faction leaders and heads of committees, First Vice Prime Minister Stepan Kubiv proposed to postpone consideration of the draft 2018 state budget for the next week.

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Parliamentarians noted the need to improve the document (without going into details though). Sources of in the coalition factions refer to several reasons for postponing the consideration of the main financial document. According to our interlocutors, we are talking in particular about the size of the subsidy for representatives of the agro-industrial complex.

"The government is proposing that we allocate 77 million USD to all, despite the fact that in the budget of 2017 this amount was about 156 million," the interlocutors note.

"We proposed to receive additional revenues to the budget by changing the taxation of land and allocating some of them to support agriculture, but this proposal was rejected," the sources note.

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In addition, according to our interlocutors, the government was proposed to amend the legislation aimed at dispossessing income from the alcohol industry. At the same time, "deputies were told that this should not be done for influential people from the power bloc could preserve their current status quo."

Our interlocutors in the Rada believe that the optimal amount of state support to the agroindustrial complex is 320 million USD. Our sources in oppositional factions, in turn, specify that "Kosyuk and Verevsky negotiate on the distribution of state support to the agro-industrial complex."

"Verevsky (the founder and majority shareholder of the agro-industrial company Kernel) wants everything to be equal, regardless of the volume of production, Kosyuk (the founder of the Myronivsky Hliboproduct Group, Ed.) opposes such an approach," sources added.

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Another field of bidding was the budget of the law enforcers. Deputies are offered to increase the funds of the Prosecutor General's Office, and the legislators themselves ask the government to think about double increase in financing of Security Service (SBU). According to Iryna Lutsenko, a representative of the president in parliament, the head of state insists that more than 5% of GDP should be spent on defense in 2018. In addition, financing of notorious project of ex-prime minister Arseniy Yatsenyuk "The Wall" is also discussed.

Rental fee for oil and gas extraction is not agreed too. There is no single point of view on the size of the subvention for the socio-economic development of the regions. To date, the budget committee of the parliament has agreed to allocate 192 million USD for these purposes. At the same time, according to sources of in coalition factions and the opposition, parliamentarians are asking for these goals at once 307 million USD.

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According to deputies from the coalition and opposition factions, the struggle for financial resources between the center and local councils became the most important battlefield. "The government proposes to increase the amount of payments to poor regions at the expense of their wealthy neighbors, resulting in the fact that individual budgets will not receive millions of hryvnias, and also want to shift to local budget payments on subsidies and utility benefits, without providing them with the necessary resources," parliamentarians note, adding that dependence of local budgets from the center will increase due to this norm. Finance Ministry, in turn, notes that the proposals of the Cabinet are economically sound.

However, while the budget auction is in full swing. It is planned that the preliminary approval of the main financial document will take place by the end of November. But the second reading might traditionally become a "Christmas tree present."

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