A. Yatsenuik: Living wage will not be decreased and pensions will be indexed to inflation level

Despite the cutback in production and the decline in GDP, the Cabinet proposes not to change the minimum wage and living wage in the current year. The Government proposes to index pensions to inflation.

This was started by Prime Minister Arsenii Yatseniuk presenting in the Parliament a draft laws on the prevention of financial disaster, and creating conditions for economic growth in Ukraine (№ 4576) and on the amendments to the State Budget-2014 (№ 4575) Thursday, 27 March.

Arsenii Yatseniuk noted that due to the decline in GDP by 3% and the cutback in industrial production, the Government would have to go through the way as Greece and Italy did, reducing the minimum wage and living wage. "But we recognize that this size is so small that its reduction in the current situation is unacceptable," he said.

"We officially declare that during 2014 minimum living standards - minimum wage and living wage - will not be changed. We will neither lower nor raise it," he said.

Arsenii Yatseniuk also informed that the Cabinet has found a way how to allocate funds to index pensions to inflation for the citizens of Ukraine. "Because the rise in prices will be compensated by the indexing that will be held by the Government," PM said.

According to the Prime Minister, the Cabinet of Ministers proposes to reduce capital expenditures. He recalled that during the last three years, capital expenditures were sent for the construction of facilities of procuracy authorities and law enforcement bodies. "We do not need such capital expenditures and we do not have funds to finance them. So we do significant reduction in funds that went to the repair of public authorities and which had no reference to economic growth," Arsenii Yatseniuk said.

The Government has also decided to reduce the total amount of the state executive of power by 10%. "From 249 thousand civil servants we cut about 24 thousand. This is the first phase, which will reduce the cost for public authorities."

Arsenii Yatseniuk said that up to 20% will be cut central executive authorities in carrying out constitutional reform, in particular, the elimination of regional administrations and establishment of the executive committee, depriving central authorities of not inherent functions and transferring these functions to the regions. "But we have to hold a constitutional reform immediately and give people what they own - power and authority in the regions," he said.

"We cut the cost for the maintenance of the Presidential Administration, the Government, the Parliament, other governmental authorities. We will sell 50% of the car park, which state authorities own," he informed.

The Government also proposes to declare the privatization of all state-owned facilities that are in the management of the Ukrainian government agency “The State Management of Affairs”.

"Country houses, factories, other real estate, which is of no use to the state, will be sold, and we should not finance from taxpayers' pockets the maintenance of former officials, said the Prime Minister. - That's why this year ends once and for all funding of reservations like Concha Zaspa and Pusha-Vodytsia. Taxpayers will no longer pay for the maintenance of these reservations. We appeal to those who live there: pay for guard, housing and communal services by your own money and buy in land plots under these facilities by the market price."

In addition, the Cabinet of Ministers proposes to introduce taxation of pensions that higher than UAH 10 thous. As A. Yatseniuk recalled, judges of the Constitutional Court decided that if the Ukrainians receive a pension in the amount of UAH 2 thous. so, for some reason the judge can receive a pension in the amount of UAH 30 - 50 thousand. "We propose to align system of calculating pensions for prosecutors, judges, staff of law enforcement bodies," PM said.

Arsenii Yatsenuik also informed that the Government adopted a political decision not to cut in two times the amount of subsides for the coal industry. "At this stage, we adopt a decision from UAH 13 billion to leave UAH 12 billion of support."

The Head of the Government noted that one of the distinguished resident of the Eastern Ukraine, which all his life he worked in the coal industry has addressed to him. "From UAH 13 billion, which are sent to the so-called subsidy of the coal industry, 10 billion of them, according to him, are being stolen and only UAH 3 billion comes to the miners. And according to our estimation, it really happens."

The Prime Minister said that a decision on this matter will be taken after his trip to Donetsk, where he will meet with the miners, "I'll show these figures, come to the Parliament and say how much from the UAH 12 billion we give directly to the miners, and how much of this amount will be removed and sent to the budget for the development of depressed regions and job creation."