85 local budgets are not approved. What consequences can there be?

The process of local budgets’ approval has not yet finished. 85 local budgets, including 51 budgets of amalgamated hromadas, where the first local elections took place on 24 December 2017, remain unapproved, informed Halyna Markovych, coordinator of the “Local budgets” direction of the sectoral decentralisation project office, presenting the data of 3 January 2018.

“If such a situation was predictable in the newly established amalgamated hromadas, as it takes some time to carry out procedures for acquiring the powers by the newly elected bodies of local self-government and newly elected heads of the councils; in case with the others, it is an inadequate organisation of work on preparation and adoption of the local budget,” commented the expert.

The largest number of unapproved local budgets – 11 budgets – is observed in the Poltava Oblast, 7 budgets in the Kyiv, Ivano-Frankivsk, Mykolayiv and Khmelnytskyi Oblasts each.

All local budgets are approved in the Zhytomyr and Kharkiv Oblasts.

According to the Budget Code, non-compliance with the terms of the draft consideration and adoption of the budget decision is a violation of the budget legislation. In addition, prior to the approval of the local budget:

  • expenditures may be made only for the purposes envisaged in the 2017 budget decision and at the same time stipulated in the draft decision on the budget for 2018;

  • monthly expenditures cannot exceed 1/12 of the budget allocations determined by the 2017 budget decision;

  • it is forbidden to carry out capital expenditures, local borrowing and provide local guarantees.

“Under these conditions, there can be no effective use of budget funds and development, since funds can be allocated only for the current expenditures, that is, consumption expenditures at the level of the last year,” added Halyna Markovych.

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