The beginning of 2018 became a starting point for a new model of financial relations between AHs and central authorities. All 665 hromadas, where the first elections have already taken place, switched to direct interbudgetary relations, including those where the first local elections were held at the end of 2017, noted Hennadii Zubko, Vice Prime Minister – Minister of Regional Development, Construction, Housing and Communal Services of Ukraine.

According to him, 1288 local budgets will have the relations with the state budget in 2018, including 24 oblast budgets, 148 budgets of cities of oblast significance, as well as that of Kyiv, 450 rayon and 665 AH budgets. 930 local budgets will receive the basic subvention, and 223 will get a reverse grant.

“There are some innovations regarding local budget revenues. They will receive 5% of rent payment for the use of subsoil for the extraction of oil, gas and gas condensate. The rent payment will be included in the following amounts: 3% - to the budgets of cities of oblast significance and AHs, 2% - to the oblast budgets, 2% - to rayon budgets, and 1% - to budgets of villages, rural settlements and towns of rayon significance. Besides, from this year, 100% of single tax payable by agricultural producers from the fourth group of taxpayers will be included to the local budgets, while last year 86% were included,” told Hennadii Zubko.

The Vice Prime Minister stressed that the state will continue to financially support investment and regional development projects. Appropriate funds are provided by the state budget. In particular,

• UAH 6 billion – at the expense of the State Fund for Regional Development,
• UAH 5 billion – subvention for the implementation of measures on social and economic development of some territories,
• UAH 1.9 billion – subvention for the formation of AH infrastructure,
• UAH 5 billion – subvention for the healthcare development in the rural areas.

In addition, since 2018, the State Road Fund amounting to UAH 37 billion has been established within the special fund of the state budget. It envisages provision of UAH 11.5 billion of subventions to local budgets for the construction, reconstruction, repair and maintenance of roads of local importance, streets and roads of communal property.

In total, the state budget provides for UAH 284 billion of subventions to local budgets. In particular, it was allocated:

• UAH 61.7 billion of educational subvention (22% more than planned for 2017),
• UAH 57.4 billion of healthcare subvention (5% more than planned for 2017),
• UAH 73.7 billion for compensations and housing subsidies,
• UAH 59.9 billion as assistance to families with children.

“Given the current position of local budgets, I believe that the main financial document of the country for 2018 will contribute to the activities of hromadas and, in general, to the intensification of decentralisation. It allows self-government to build up a resource base and arrange property issues on socio-cultural facilities. And this is a step towards the functional optimisation of educational, cultural, and healthcare institutions ... It will enable the mentioned sectors to form effective institutions promoting social and humanitarian territorial development, and increase the quality of services for people. And this is, in fact, the main task of decentralisation,” emphasised the official.