For the first time ever, the mission of the International Monetary Fund is keen on the process of the decentralization reform in Ukraine. This is the very reform that completely changes the governance system within the state, financial capacities and the potential of the regions. This was stated by Vice Prime Minister/ Minister for Regional Development, Construction, Housing and Utilities of Ukraine Hennadii Zubko during the presentation of monitoring of the decentralization reform for the IMF representatives.
"Decentralization does not only mean an increase in local budgets, but it also includes motivation of local self-government bodies to leverage investments for community development and to implement infrastructure projects. The reforms being carried out in the country are a kind of 3D model. After all, the reform of any branch – in the medical, educational or social sphere alike – is transferred to the level of each particular community, all of which are now undergoing a transformation phase as well. Each particular reform should be verified at the level of communities", stressed Hennadii Zubko.
The Government has already completed the first stage of financial decentralization: amendments have been made to the Budget and Tax Code of Ukraine regarding devolution of additional budgetary powers to local governments and consolidation of stable sources of earnings to ensure their implementation. As a result, a significant improvement in the financial position of local governments is observed.
The Vice Prime Minister stressed that within three years since the beginning of the decentralization reform, revenues of local budgets of Ukraine grew by UAH 102.1 billion or 2.5 times - from being UAH 68.6 billion in 2014 to UAH 170.7 billion in 2017 (plan for 2017 contains the figure UAH 170.7 billion, forecast – UAH 190 billion).
"The country is facing a number of challenges. We must, as soon as possible, strengthen a legal framework of the decentralization reform and include changes to the Constitution. The state should have controlling functions to determine the principles of decentralization and the capacities of local self-government, while the executive functions should be transferred to the communities," he said.
Among the issues raised at the meeting with representatives of the IMF were a further vision of the development of reform, in particular the financial aspect and sectoral dimension; legislative support for community consolidation, as well as adoption of amendments to the Constitution; increasing the level of autonomy and self-sustainability of the amalgamated communities in decision-making as a result of reforms; realization of the reform on the ground, etc.