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  • Novelties in the system of granting subsidies are aimed at combating abuses and improved targeting of assistance
    Information and Communication Department of the Secretariat of the CMU, posted 08 June 2018 11:01

    Changes in the system of subsidies in effect on completion of a heating season are aimed at counteracting the existing abuse by consumers and improve targeting of assistance being paid to those only who really need it. This was stated by Prime Minister of Ukraine Volodymyr Groysman during A Question Time for the Government at the Verkhovna Rada.

    "It is crucial to ensure that for someone who can not afford to pay will pay the state. And by now we got a string of overindulgence cases", the Head of Government urged. He cited examples of when people having assigned subsidies allowed heavy expenses and expensive things. This, in the opinion of the Head of Government, is unfair.

    "I want to assure: we shall enter the new heating season all right and fair."

    Background

    In April of this year, the Government made an important step towards monetization of subsidies. It is planned that in the next heating season, subsidies will be issued in ready money, which means that their recipients can keep their savings as a result of sparing consumption. Thus, monetization will be an additional incentive for energy efficiency. Meanwhile, Government assitance will be paid to those who really need it. Abuses in this sector will be identified and prevented. People who just disguise their bankroll won’t have access to the program and won’t be allowed to batten on the funds of taxpayers.

    What innovations are necessary to be aware of and what to pay attention to now?

    Luxury items and rental income

    In the cities with over a million population, there have become commonplace the cases of renting apartments with a kind of bonus - a paid subsidy for utilities. At that, the owners of the house, apart from receiving rental income, have vehicles or other luxury articles.

    From now on, if the family owns a car lesser than five years from its registration, except for a motorbike and a car provided by the social welfare authority, no subsidy will be granted.

    In addition, income from rental of property, in particular, from lease of an apartment, will now be required to be included in the e-asset declarations - in the new column "other income".

    Large houses and flats

    There are housing facilities that exceed the average and are considered "premium class". Until recently, subsidies were also issued on the grounds that a single pensioner with a minimum pension was registered there. She, quite obviously, was not able to pay for the services in full and applied to the commission for granting the subsidy for extra area.

    From May 1, 2018, there is a new rule in effect: the subsidy is canceled if the area of the apartment exceeds 120 square meters, and the house - 200 sq. m, except for kindergartens of family type and foster families. Owners of such a living space will pay for services in full.

    Shadow employment

    Many Ukrainians work abroad, but they are applying for subsidies by declaring zero incomes. Now, for those who are indeed unemployed, it will be necessary to register at the employment center. People of working age applying for a subsidy, but not registered as unemployed due to work without registration in Ukraine or abroad, will have their income automatically counted by the social security authorities as three living minimum wages – UAH 5,286.

    The Ministry of Social Policy of Ukraine is convinced that this step will stimulate Ukrainians to be officially employed, promote deshadowing and eliminate social injustice when people with a high income receive a subsidy.

    In order to stimulate energy saving, starting from  May 1, 2018, the social norm for gas heating will be approximated to real consumption volumes and will amount to 4.5 m3 per 1  square meter, electric heating - 30 kWh per 1 square meter. If subsidies are granted on the area of a house which exceeds accepted footage, the norm may be increased by no more than 30%.

    It is also important to know that internally displaced people will now be able to receive a subsidy without a rental agreement - only on the basis of  application and declaration, containing information about family members. The application will be a basis for examining the living conditions, and after that on the basis of home study a subsidy will be granted.

    The Government also simplified the procedure for receiving subsidies for residents of consolidated territorial communities. From now on, they have the right to receive from citizens the documents for processing the subsidy for their transfer to the social security bodies. The mechanism repeats the practice of applying to village and town councils.

    The Government will also grant bonuses to household for saving resources based on the results of the heating season. The subject to monetization are electricity savings equivalent to the cost of 150 kW and for natural gas - 100 cubic meters if these resources were used for heating. The maximum amount of money  that a citizen can receive makes up UAH 700. Those citizens having managed to economize have to file an application to the social protection authorities by September 1 of this year, on the basis of which the payment of monetary compensation for energy efficiency will be provided.

    Each recipient of the subsidy can keep track of information on the existence of savings in its payment receipt or by contacting the gas or electricity supplier if they are used for heating. However, everyone  should individually choose the best option how to receive the reimbursed sum.

    Novelties in the system of granting subsidies are aimed at combating abuses and improved targeting of assistance Novelties in the system of granting subsidies are aimed at combating abuses and improved targeting of assistance