PUBLIC FINANCE MANAGEMENT

LONDAR Serhij ¹

¹Institute of Educational Analytics
OrcID ID : https://orcid.org/0000-0003-1838-288X

European fiscal consolidation: which experience should Ukraine consider?

Тhe essence of fiscal consolidation measures in EU provided by changes to the European Stability and Growth Pact in 2011 was analyzed. Analysis of the results of ongoing fiscal consolidation showed that it not always contributed to accelerated growth of European economies. However, a ""win-win” part of fiscal consolidation is a medium-term budget planning. The most of European countries that had substantial economic problems during the crisis significantly increased quality of the medium-term budget planning. Paper gives the definition of ""mediumterm budget planning” based on international experience. It includes the presence of five interrelated elements: 1) economic development strategy; 2) formation of institutions and procedures that provide high-quality medium-term macroeconomic and fiscal forecasting; 3) the procedures of ""fiscal rules” introduction; 4) the procedures and mechanisms of ""expenditure limits” formation; 5) the mechanisms of interaction between elements of ""current” and ""medium-term” elements in budget planning. The European experience of fiscal consolidation cannot be directly applied to the Ukrainian economy. The paper discusses its specific features that increase volatility of macroeconomic and fiscal performance under the action of internal and external financial and economic factors. The article analyzes practical government steps on implementation of the medium-term budget planning in Ukraine that will improve efficiency of budgetary instruments to encourage development of national economy.

Keywords:fiscal consolidation, measures of fiscal consolidation in the EU, medium-term budget planning.

JEL: E62, H30, H50, H60, H63

Londar S. . European fiscal consolidation: which experience should Ukraine consider? / S. . Londar // Фінанси України. - 2014. - № 1. - C. 39-53.