Ukraine's coronavirus fund: Where does the money go?

Author : Natalia Lebed

Source : 112 Ukraine

Ukraine’s chief sanitary officer, Viktor Lyashko, said that his team has elaborated 81 (!) scenarios of what the coronavirus course will be like in Ukraine
23:17, 23 June 2020

Coronavirus face mask financial market

Recently, Ukraine’s chief sanitary officer, Viktor Lyashko, said that his team has elaborated 81 (!) scenarios of what the coronavirus course will be like in Ukraine. But it seems that the Ministry of Finance also has 81 ways of calculating funds aimed at combating this disease.

The Ukrainska Pravda outlet reported on June 18 that from the responses it received from the Ministry of Finance and the State Treasury Service, one can see how little money was spent on the fight against Covid-19. With more than 2,4 billion USD of the fund for the fight against coronavirus as of June 1 spent 26 million USD. That is 1% of the total amount of funds. But this is only one version.

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Meanwhile, has some other data, obtained from a speech by the Minister of Finance at a meeting of the Verkhovna Rada on June 19, as well as from answers to parliamentary inquiries by MP Antonina Slavytska, a member of the “anti-corruption” committee of the Verkhovna Rada.

Minister of Finance Serhiy Marchenko marks, “as of June 18, 2020, the government decided to allocate funds of the fund in the amount of 1,4 billion USD. In particular, a government decree for 712 million USD was adopted, as well as protocol decisions for 638 million USD. Based on these decisions, the balance of the Fund as of June 18 is 1,1 billion USD. Cash expenses as of June 16 amounted to 77 million USD.”

Further, Marchenko gave a detailed explanation of the data:

- 337 million USD to the Compulsory State Unemployment Insurance Fund to help those who were left without work due to quarantine (both on an irrevocable and repayable basis);

- 3,7 million USD to healthcare institutions that provide inpatient care to patients with Covid-19 (purchase of mechanical ventilation devices);

- almost 112 million USD is provided for measures to prevent an outbreak of the epidemic, of which 24 million USD - for laboratory units of the Ministry of Health, another 86 million - for the purchase of personal protective equipment for health facilities that provide in-patient care for patients with Covid-19 and emergency medical help;

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- 94 million USD is provided for the assistance of the Social Insurance Fund (including 471 million for payments to families of medical workers who died from coronavirus disease);

- 101 million USD for additional payments - up to 50% of the salary or cash support for the military, police and "relevant categories that ensure the livelihoods of the population";

- 888,000 USD for measures to overcome Covid-19 in penitentiaries and pre-trial detention centers;

- 1,9 million USD for refunds for canceled trial external independent evaluation.

All these amounts add up to 712 million USD, which was mentioned above. As for the additional 627 million USD mentioned, these funds went, in particular, directly to the Ministry of Health, the Ministry of Education and Science (including the creation of safe conditions for conducting UPE), the Pension Fund, etc.

MP Antonina Slavytska shared the data, received from the same Ministry of Finance. The figures from her documents differ from what the head of the department spoke about.

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First of all, according to the Ministry of Finance, filling the fund for the fight against coronavirus corresponds to an amount of 2,4 billion USD. All these are funds that have been transferred from the state budget.

But what were they spent on? The Ministry of Finance gives 6 items of expenditure.

The first expenses went to the needs of the Compulsory State Social Insurance Fund for Unemployment. 225 million USD was allocated for these needs. As part of the government’s decree “On the allocation of funds to provide assistance to children to individuals - entrepreneurs who have chosen a simplified taxation system and belong to the first and second groups of single taxpayers,” 62 million USD is allocated to the Ministry of Social Policy.

The third amount - by the way, the smallest of all the rest - went to the Ministry of Health for the purchase of mechanical ventilation devices – 3,7 million USD.

The fourth and fifth digits show the doctors’ salaries. 2,5 million USD was allocated “for the purchase of personal protective equipment, laboratory equipment, and consumables for laboratory research.” And another 86 million USD was spent “to purchase personal protective equipment in order to cover the needs of healthcare institutions.”

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Finally, the last, sixth item of expenditure is 85 million, which went for “paying material support to family members of medical and other health care workers who died from Covid-19.”

So it turns out that out of the 2,4 billion USD of the coronavirus fund, about 487,000 have been spent.

Why did the minister say about 712 million USD? It is obvious. Contributions to the social insurance fund differ by 112 million USD. The next major discrepancy concerns bonuses to security forces and other categories, “which ensure the livelihoods of the population.” This is 101 million USD.

Earlier, Minister of Internal Affairs Arsen Avakov asked the Cabinet of Ministers to allocate funds from the Covid-19 special fund so that the Ministry of Internal Affairs would be able to provide additional payments to doctors of the Ministry of Internal Affairs, police, rescuers, border guards and national guards who work during the quarantine. On June 10, the Cabinet of Ministers of Ukraine allocated more than 112 million USD for such surcharges. But within a few days, the budget committee of the Verkhovna Rada rejected such a redirect.

And yet, on June 19 - just before the meeting of the Verkhovna Rada, where Marchenko spoke - the budget committee returned to this issue and agreed to allocate almost 112 million USD for additional payments to law enforcement agencies. This gave the Minister of Finance the opportunity to include the figure in his report.

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The Finance Ministry’s responses received by Antonina Slavytska also lacked the transfer of funds for the needs of the pre-trial detention center plus the return of money to applicants for “canceled trial external independent evaluation.” But in both cases, we are talking about fairly insignificant amounts that have little effect on the overall picture.

This very insignificant amount (as mentioned above) was allocated for the purchase of mechanical ventilation devices. 3,7 million USD is nothing against payments for the National Police or unemployment benefits. And although all items of expenditure are important, a similar minuscule, allocated for mechanical ventilation, just amazes.

Viktor Lyashko complained about a lack of funds for the purchase of mechanical ventilation devices. But, as we see, the government did not become generous to buy such equipment.

To understand the situation, the average ventilator costs 37,000 USD. That is, the country bought 100 devices. If we add them to 2000, which Ukraine has already had, the figure will not change much. Meanwhile, in the world, according to international protocols, there must be at least two ventilators on each patient bed. But in Ukraine, according to doctors, there are only 0.7 ventilators per resuscitation bed.

June 18, bill No. 3509 was adopted, which proposes to expand the list of areas for spending the funds of the coronavirus fund. It is expected that from there the money will be directed to “improving transport communications, construction, reconstruction, overhaul and current average repair of public roads of national importance.” The final amount of funds is not indicated, but, according to the presented financial and economic justification, it will be about 933 million USD.

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Antonina Slavytska states “So far I have received the only letter from officials of the Ministry of Health, the essence of which was as follows: 10,094 medical and other employees received 3,8 million USD for March. In April, 26,550 medical workers received 15 million USD.”

Minister of Health Maksym Stepanov claims that the doctors do not receive the promised salaries “and this the fault of the local authorities or the chief doctors of medical institutions,” the official insists.

The use of the “coronavirus” funds is a separate big problem. The Accounts Chamber took control of this topic. According to a recent statement by its chairman, Valeriy Patskan, Chamber experts have already begun tracking the costs of fighting the Covid-19.

But while expenses from domestic sources of income can still be investigated, the situation with checking the funds that came to Ukraine from abroad is much more problems. Therefore, it seems that only the IMF can track their money (and require a detailed report). Meanwhile, $ 58 million of total assistance from WHO, UNICEF, and the UN should be sent to Ukraine.

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