“Budget decentralisation proved its efficiency, but needs to be improved,” Vyacheslav Nehoda

MinRegion continues to work on improving budget decentralisation. The reform started in 2015 and provided significant growth of local budgets (if in 2014 own revenues of the general fund of local budgets totaled UAH 68.6 billion, already in 2018 budget decentralisation increased this figure to UAH 234.1 billion). However, practice has shown the need for improved formation of a proper resource base of local self-government. The issues to be solved for this, changes to be introduced in the legislative framework and results to come were discussed with experts at a working meeting in MinRegion’s Directorate of Local Self-Government, Territorial Organisation of Power and Administrative-Territorial Structure.

Vyacheslav Nehoda, First Deputy Minister of Regional Development, Construction, Housing and Communal Services, informed that the Ministry, together with the expert community and local self-government associations is working on proposals that will improve the system of horizontal equalisation of local budgets, streamline the allocation of additional subsidies, excise taxes etc.

“Budget decentralisation has proved its efficiency. During the years of its introduction, we have acquired some experience, we constantly communicate with local self-government and see that it is necessary for interbudgetary relations to be equally fair for territorial hromadas and for the budgets to be strengthened,” said Vyacheslav Nehoda.

The tasks also include resolution of the issue of those rayons the territoryof which is completely or almost entirely covered by AHs. In such rayons most powers from rayon councils and rayon state administrations were transferred to the level of amalgamated hromadas, but funding of these structures remained unchanged.

Besides, MinRegion intends to prepare proposals on the typical structure of the executive body of local self-government and remuneration of its employees.

“In the coming days we will invite local self-government associations to discuss all these issues. Today's meeting precedes a joint work with all stakeholders on the issues of formation of a proper resource base of local self-government. We look forward to a productive work that will answer the questions raised by urban and rural hromadas and other local self-government bodies, as well as to the reflection of these proposals during the preparation of the draft state budget for 2020,” said the First Deputy Minister.

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