Dear colleagues, dear Ukrainians.

Today, the main issue at the Government meeting is the adoption of the draft budget for 2023. Despite the war, we submit the budget to the Parliament on time, i.e. by September 15, as stipulated by the current Ukrainian legislation.

The 2023 National Budget is a budget for victory. Yet now, we honestly tell society that the year will not be easy. War is expensive. Very expensive.

Therefore, the core objective is to use the funds we have with maximum effectiveness. In the budget that we submit, there is one essential priority - the defense and security of our country. A resource of UAH 1.136 trillion or almost 50% of all expenditures will be directed to the security and defense sector. These are the wages of the military, provision of the army, repairs and purchases of equipment and weapons, and many other things critical for the defense sector. If we compare it with the budget that we submitted for 2022, then an increase in spending on security and defense will be more than 4 times.

The second priority is the social programs. 35% of all expenses in the draft budget fall into pensions, subsidies, assistance to low-income families, payments to internally displaced persons, expenses in healthcare and education sectors. This is more than UAH 800 billion. It is critical that the Government will ramp up targeted assistance to those who need it the most, in particular, we anticipate growth in financing of the Pension Fund from the budget by over UAH 30 billion.

In other words: from every budget hryvnia, 50 kopecks will go to the army and security, another 35 kopecks will go to social benefits, medicine and education. Everything is clear and transparent.

All other expenses will be reduced. The main article is to cut budget spending on state authorities. We are reducing the number of officials, cutting salaries and bonuses. With the exception of law enforcement agencies, expenses on the operation of government bodies will be reduced by UAH 11.6 billion as compared to 2022.

In addition, as part of the national budget for 2023, a budget-funded Armed Aggression Consequences Liquidation Fund containing a resource of at least UAH 19 billion will be created. It is planned to accumulate the confiscated funds of russia and russian citizens, as well as international aid for rapid recovery. An additional grant for compensation of expenses for local budgets in connection with the war to the tune of UAH 24 billion is also envisaged.

Taking into account such priorities and limited resources, we ask MPs to take a responsible approach to the issue of approval of the budget. We understand that there will be attempts to increase expenses. But, as I have already emphasized, war is expensive, and Ukraine cannot afford many positive but populist initiatives now.

In 2023, the state's budget revenues will amount to UAH 1.28 trillion, while expenditures are planned at the level of UAH 2.57 trillion. Accordingly, we estimate the monthly budget deficit for next year at more than USD 3 billion. Our international allies already help us finance more than a third of the budget. For our part, we exert every effort to ensure that the financial support of our partners continues in 2023. And we definitely cannot afford additional non-targeted expenses.

Another important moment is that the situation with the budget, macroeconomic forecast, economy revitalization directly depends on the developments in the front. We constructed a lot of various scenarios. The draft budget that we submit to the Verkhovna Rada is a conservative and moderately pessimistic estimate, since this year Ukraine is facing a situation where the budget is revised every month depending on the priority funding needs. Next year, at least its beginning, will take place according to a similar scenario.

Together with each draft budget, the Government always adopts a macroeconomic forecast, being the basis for future planning the state budget. This forecast includes the rate of GDP growth and inflation, average salary, dollar exchange rate and more. This year the macroeconomic forecast is a consensus between the Government, the National Bank and international financial organizations, because depending on the situation at the front, the economy of Ukraine in 2023, according to him, may either fall by 0.4% or grow by 10% or more. The same approach applies to the rest of showings. Hence, I reiterate the current macroeconomic forecast is a rather conservative scenario, because we have to be ready for any developments.

Therefore, within this macroeconomic forecast, next year's economy will grow by 4.6% in real terms and by 37% in nominal terms. The average salary will approximately amount to UAH 18,500, inflation may reach 30%, the average annual exchange rate of the dollar will fluctuate around UAH 42.

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Despite all the challenges and severities, our economy and financial system have endured this year. We also have a full understanding of how we will end the year covering all the necessary payments.

The draft budget that we are to approve today also gives us a full understanding of the priorities for the coming year. We will provide for our army, finance pensions, salaries of doctors and teachers, support the most socially vulnerable categories of the population, and continue economic stimulus programs. Ukraine will definitely win, and we will begin the major reconstruction and transformation in Europe in the last 70 years.

We believe and thank the Armed Forces of Ukraine! We believe in our victory and do everything we can to bring it closer. Glory to Ukraine!