4-5 times increase: small cities and rayon centres can calculate how much their budgets will raise next year

From the beginning of 2020, all small cities and rayon centres will have the powers and resources currently available for large cities and amalgamated hromadas. This is the initiative of Ukraine’s Prime Minister Volodymyr Groysman. If the Verkhovna Rada adopts the relevant law in autumn, from the beginning of the next year budgets of cities and urban-type settlements rayon centres will increase four-fivefold.

In total, more than 900 AHs have been formed in Ukraine. And more than 200 settlements – rayon centres and cities of oblast significance – are potential centres of amalgamated hromadas. However, they are still not involved in the process of capable hromadas’ formation. One of the main reasons is the lack of perspective plans for the formation of hromadas in oblasts. Unfortunately, oblast state administrations and oblast councils are often in no hurry to develop and make changes to perspective plans.

As a result, more than 2.6 million people living in these 200 cities and settlements cannot take advantage of the opportunities AHs have.

To resolve this issue, MinRegion, following instructions of the Prime Minister of Ukraine, has developed a separate draft law equalising rayon centres, cities of oblast significance to capable amalgamated hromadas. The draft law also temporarily, during the period from 2019-2020, authorises the Cabinet of Ministers to develop and approve perspective plans for the formation of hromadas’ territories in oblasts.

According to Volodymyr Groysman, after small cities get the status of capable, they will see available opportunities in their own experience. This will motivate them to amalgamate with neighbouring villages and become even stronger.

“Decentralisation.gov.ua has an online calculator, created at MinRegion’s initiative and supported by the Swiss-Ukrainian project “Decentralisation Support in Ukraine” (DESPRO). This tool allows cities and villages to calculate how the hromada budget will change, when it receives the AH status, according to forecast amounts of revenues, expenditures and intergovernmental transfers,” said Yanina Kazyuk, doctor of public administration and finance expert.

Find out how to access the calculator via the link.

On the example of several cities, experts have shown how the local budget will change after hromadas receive the status of capable:

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DESPRO budget Ya.Kazyuk

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