What the budget-2019 should be like: the priority of education and medicine, fair privatization, the return of decentralization

In Ukraine, a new budget process will start in the next week – by September 15, the government has to submit a draft budget for the next year to the parliament.

Roman Semenukha enumerates the main points that should be there in the next budget, and which we must monitor.

  1. Transparent privatization.

This year, the government is once again failing the privatization plan – out of 21 billion, planned for a year, in half a year, we have only received about 50 million.

Privatization – 2019 should become effective: instead of selling profitable and strategic enterprises, unprofitable ones, whose financing is a burden for the budget, should be sold.

  1. Preservation of decentralization.

The key reform that gave impetus to the development of cities must be preserved, and the mistakes of the budgets of past years that led to its unjustified reduction must be corrected.

5% of the excise tax on fuels and lubricants should be sent to local budgets, and payment of housing and communal services of educational and medical institutions should be financed from the central budget, as it was at the beginning of decentralization.

  1. Citizens’ health is a priority.

We must ensure the full financing of medical subvention, emergency medical care.

For the first half of 2018, the medical subvention was 500 million hryvnias underfunded. The subvention for the development of health care in rural areas (625 million hryvnias) remains only on paper only.

There is no money for medicine in the treasury, at the same time, the expenses of the Prosecutor General’s Office, the Ministry of Internal Affairs, the Security Service, which have grown significantly this year, are duly financed.

Such an unfair distribution of expenditures is unacceptable for the next year.

  1. We must ensure sufficient funding for the education sector: to raise salaries for young teachers, change the system of state orders in accordance with the needs of the market and the state.

Because of the low salaries, young people do not want to choose the profession of teacher. For the state itself, teachers are not a priority either: only 320 positions of future teachers of chemistry and physics all throughout the country will be financed from the budget. Literally, this means that in five years there will be no specialists in schools to teach children.

  1. Full-fledged youth credit provision as an opportunity to return young people to Ukraine and make stay those who plan to leave.

Financial support for the program of youth construction (compensation of interest and support of the fund for the promotion of youth construction) this year makes up scanty 42 million hryvnias.

In order to keep young people in the country, this figure must be at least 3 billion, while the rules for obtaining loans should be simplified.

  1. Fair pensions and subsidies.

We need a quality law on servicemen’s pensions. Instead of making people dependent on subsidies and instead of an unfair reduction in the number of subsidy recipients – we need monetization and the creation of a single register of recipients of social services. The next step should be the introduction of the defined contribution pension system, which will solve the problems of future pensioners.

There are risks that the next budget will become the next “excessive spending budget”, the budget of delays with key reforms and waste of taxpayers’ money in the year of presidential and parliamentary elections.

We cannot let this happen, because the budget is not just a financial plan for a country’s life for a year. The budget determines the strategy and plan for the development of the economy and social policy of the state.


Roman Semenuha
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