​Oksana Markarova has presented the draft state budget for 2019 at the meeting of the Budget Committee

9/20/18

Acting Minister of Finance Oksana Markarova attended the meeting of the Parliament’s budget committee on September 19 to present the draft Law of Ukraine “On the State Budget of Ukraine for 2019”. On Friday, September 21, the draft law will be examined at the plenary meeting of the Parliament.

The draft state budget of Ukraine for 2019 was prepared in accordance with the draft of the Main Areas of the Budgetary Policy for 2019-2021 (approved by the order of the Cabinet of Ministers of Ukraine No. 315-r of 18.04.2018) and the results of meetings conducted to agree its figures.

The figures of the draft state budget are realistic, since they are based on scenario 1 (basic) of the macro-economic forecast approved by the Government. This scenario is more conservative compared to the other two scenarios and sticks to the realistic macro-data of economic and social development as required by the Budget Code of Ukraine.

The total volume of the state budget for 2019 is equal to 1,108.1 billion hryvnas, including 994 billion hryvnas for the general fund (+84.6 billion hryvnas compared to 2018): revenues – 916.1 billion hryvnas; deficit – 69.6 billion hryvnas; re-payment of loans – 8.3 billion hryvnas.

The revenues of the draft state budget for 2019 are equal to 1,008.4 billion hryvnas, including 916.1 billion hryvnas for the general budget fund.

The expenses and loans of the state budget are equal to 1,108.1 billion hryvnas, including 994.1 billion hryvnas for the general budget fund.

The deficit of the state budget is equal to 90 billion hryvnas or 2.28% of the GDP. To ensure the balance and stability of the budget system, it is planned to reduce the deficit limit further to 2.28% of the GDP in 2019 (compared to 2.4% in 2018).

It is also planned to reduce the volume of the public debt to 52.2% of the GDP by the end of 2019, especially by cutting the state budget deficit and ensuring GDP growth. Expenses to serve the public debt in 2019 will amount approximately 417.4 billion hryvnas, including 145.2 billion and 272.2 billion hryvnas to repay the loan interest and the loan body respectively.

The living wage shall amount 1853 hryvnas starting from January 1, 2019, increasing to 1936 and 2027 hryvnas in July and December respectively. The minimum wage will increase from 3723 to 4173 hryvnas starting from January 2019.

Pension expenses from the state budget of Ukraine for the Pension Fund are set at 166.5 billion hryvnas. The total expenses of the draft state budget for 2019 also include the further adjustment of pensions for military service members, which started in 2018, and the adjustment of pensions starting from March 1, 2019.

The draft state budget includes 58.1 billion hryvnas for subsidies to citizens related to housing amenities. This amount includes 55.1 billion hryvnas for electricity, gas, heating, water supply as well as for the processing of sewage water, house rent etc.; 2.9 billion of the above 58.1 billion hryvnas are allotted to provide subsidies to citizens related to the purchase of solid and liquid household fuel and liquefied gas.

The draft state budget provides 209.7 billion hryvnas to improve the defence and security capacities (including 5 billion hryvnas as a government-backed sum). 111.5 billion hryvnas of this amount are for the salaries of military service members, officers and the police (including additional payments); 28.9 billion hryvnas of this amount are provided for the development of weapon systems and military utility equipment.

The medical subsidy stipulated in the draft state budget is equal to 55.5 billion hryvnas, 15.3 billion hryvnas are allotted for the program of medical guarantees for the basic healthcare services. Further healthcare expenses include 2 billion hryvnas for the pilot medical guarantees for secondary (specialized) healthcare services, 0.97 billion hryvnas for the pilot medical guarantees for secondary (specialized) healthcare services in Poltava region, 1 billion hryvnas for the development of emergency medical assistance in pilot regions, 5.9 billion hryvnas for the centralized purchase of medicines and healthcare products, 1 billion hryvnas for the refund of purchased medicines, 1 billion hryvnas for the development of healthcare in rural areas and 0.4 billion hryvnas for the medical treatment of Ukrainian citizens abroad.

The education subsidy amounts 71 billion hryvnas, 1.3 billion hryvnas are allotted for the project “New Ukrainian School” (this includes 1 billion hryvnas for the purchase of learning equipment and mobile furniture for the primary school), 0.5 billion hryvnas – for inclusive education (additional corrective and development classes, purchase of special materials and equipment for the correction of the psychological and physical development of children with special needs).

5.4 billion hryvnas are provided for culture development in 2019. This includes 1 billion hryvnas for the development of the Ukrainian film industry and production of patriotic films, 0.5 billion hryvnas for the construction of cultural objects of national significance, 0.2 billion hryvnas for the support of contest-based art projects and for the activities of the Ukrainian Cultural Foundation, 0.1 billion hryvnas for the support of the book-publishing industry and promotional of Ukrainian literature worldwide as well as for the activities of the Ukrainian Book Institue, 0.1 billion hryvnas for the preservation of the national cultural heritage, including the UNESCO world cultural heritage.

1.8 billion hryvnas are allotted for the financial support of the Ukrainian National Public TV and Radio Company (+1 billion hryvnas compared to 2018).

55 billion hryvnas are provided for the development of the road infrastructure, including 50.4 billion hryvnas for the road construction fund and 4.6 billion hryvnas from international donors.

The draft state budget stipulates 7.9 billion hryvnas for the development of the agricultural complex and farming. This includes 6.9 billion hryvnas from the general fund as follows: 4 billion hryvnas – development of livestock breeding, more than 1 billion hryvnas – development of farms, 1.4 billion hryvnas – measures to reduce the costs of Ukrainian agricultural machines, 400 million hryvnas – support of gardening and viticulture, 127.1 million hryvnas – measures to make loans more affordable for business.

As part of measures to enhance independence from foreign energy supply, 2.3 billion hryvnas shall be provided for the reform of the coal industry, including 0.7 billion hryvnas for the liquidation of old coalmines and 1.6 billion hryvnas for the restructuring of the coal industry. 2 billion hryvnas are provided to foster energy efficiency, including 1.6 billion hryvnas for the energy efficiency fund and 0.4 billion hryvnas for the “heating” loans. Funds from the European Union amounting 0.5 billion hryvnas will be provided for the implementation of the energy strategy (continued implementation of the agreement between the Government of Ukraine and the European Union on the funding of the program “Continued Support for the Implementation of the Energy Strategy of Ukraine”, signed in 2013).

State financial support for the implementation of investment programs and regional development projects will amount 11 billion hryvnas, including 9.1 billion hryvnas for the State Regional Development Fund (1% of the revenues of the general fund of the state budget, as required by the Budget Code) and 1.9 billion hryvnas as a subsidy for the build-up of the infrastructure in amalgamated hromadas.


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