№ 9/2023

№ 9/2023

Fìnansi Ukr. 2023 (9): 24–47https://doi.org/10.33763/finukr2023.09.024

PUBLIC FINANCE MANAGEMENT

RADIONOV Yurii ¹

¹Accounting Chamber of Ukraine
OrcID ID : https://orcid.org/0000-0002-1691-1090

Priorities of budget policy under martial law and post-war recovery of Ukraine

Introduction. Various financial and economic crises, shocks, including the introduction of martial law, affect the state of implementation and fundamentally change the priorities of budget policy, and therefore require timely adjustment of the main directions and macro indicators. Fiscal risks are increasing, exogenous and endogenous factors are exerting a powerful influence on the financial and budgetary system, which requires special attention to the analysis of the state of formation of budget revenues, determination of priorities, rational distribution and effective use of budget expenditures.
Problem Statement. Budgetary policy under martial law has not been sufficiently studied. The outlined problems require in-depth study, as this policy must be rational, efficient, effective, take into account the conditions of the war and foresee real ways of further development in the post-war period.
The purpose is to develop an algorithm for further development, to form an effective mechanism for the distribution and redistribution of budget funds, to increase the efficiency and effectiveness of budget policy during the recovery period of Ukraine based on an analysis of its priorities in war conditions, their features, expediency and justification.
Methods. General scientific and special methods are used: analysis, synthesis, grouping, description, comparison, theoretical generalization and abstract-logical.
Results. During the war, the issue of the effectiveness of the management of the country's financial resources becomes relevant. The analysis of the structure of budget expenditures demonstrates the priorities of the budget policy within the concentrated volume of financial resources, the possibilities of the state or local budgets for financing activities, the corresponding category of expenditures. In 2022, there were significant changes in budget policy priorities, caused by a full-scale Russian invasion and the need for a significant increase in funding for the security and defense sector. There was a problem with servicing the state debt and the impossibility of filling the revenue part of the state and local budgets to form the appropriate level of expenditures, which is a characteristic feature of a country whose economy is engulfed in war. The analysis of expenditures by types of budgets and the structure of the consolidated budget by functional classification shows that the priorities of the budget policy in peacetime and in the conditions of martial law are different. The hypothesis regarding the differentiation of the budget by military significance is put forward and substantiated.
Conclusions. If before the war, the priorities of budget policy were the post-pandemic recovery of the economy and the direction of investments in the country's future, now - ensuring defense capability and stable functioning. Redirecting a significant amount of financial resources to the needs of the security and defense sector of Ukraine is an appropriate, justified and justified step. In the post-war period, the priorities of budget policy will change, based on those tasks and goals, which will be determined by medium- and long-term programs for the recovery and development of Ukraine. At the same time, the task of increasing the potential of the Armed Forces of Ukraine and the development of the military-industrial complex will continue to be a priority area of budget policy. In order to increase the effectiveness of budget policy and its effectiveness, it is necessary to reform outdated methods and approaches to managing budget expenditures, introduce full-fledged medium-term budget planning, constantly analyze the tasks and goals of budget programs, achieve the planned results, and on this basis develop proposals regarding the features of the further implementation of these programs in planned and subsequent budget periods.

Keywords:state budget, consolidated budget, local budgets, budget expenditures, deficit, budget policy, recovery

JEL: H50, H61

RADIONOV Y. . Priorities of budget policy under martial law and post-war recovery of Ukraine / Y. . RADIONOV // Фінанси України. - 2023. - № 9. - C. 24-47.

Article original in Ukrainian (pp. 24 - 47)

Download

Downloads :349

1. Kaneva, T., & Halaburda, A. (2022). Budget policy of the state under martial law. Scientia·Fructuosa, 144 (4), 98–109 [in Ukrainian]. doi.org/10.31617/1.2022(144)07
2. Chuhunov, I. Ya. (2005). Theoretical foundations of the budget regulation system. Kyiv: RFI [in Ukrainian].
3. Lysiak, L. V. (2009). Budgetary policy in the system of state regulation of social and economic development of Ukraine. Kyiv: SESE “The Academy of Financial Management” [in Ukrainian].
4. Verkhovna Rada of Ukraine. (2003). Economic Code of Ukraine (Act No. 436-IV, January 16). Retrieved from www.zakon.rada.gov.ua/laws/show/436-15 [in Ukrainian].
5. Radionov, Yu. D. (2020). Theoretical and methodological foundations of effective budget policy formation in modern conditions. In Romanenko, E. O., & Zhukova, I. V. (Eds.). Modern aspects of science (Vol. 3), pp. 90–131. Kyiv ; Bratislava: FOP Kandyba T. P. [in Ukrainian].
6. Krykun, T. (2019). Priorities for budget policy. Investytsiyi: praktyka ta dosvid, 16, 28–32 [in Ukrainian]. doi.org/10.32702/2306-6814.2019.16.28
7. Iholkin, I. (2016). The role of budget relations transparency in the public finance management system. RFI Scientific Papers, 1, 50–67. Retrieved from npndfi.org.ua/?page_id=723&aid=773 [in Ukrainian].
8. Koliada, T. A. (2016). Formation of the budget strategy of Ukraine: theory, methodology, practice. Irpin: University of the SFS of Ukraine [in Ukrainian].
9. Minfin. (n. d.). Expenditures of the consolidated budget of Ukraine. Retrieved from index.minfin.com.ua/ua/finance/budget/gov/expense/ [in Ukrainian].
10. Hrynko, O. (2022, September 14). Ukraine agreed to stop payments on foreign debt. Retrieved from zaxid.net/ukrayina_domovilasya_pro_prizupinennya_viplat_za_zovnishnim_borgom_n1549669 [in Ukrainian].
11. Repko, M., Tomilina, M., & Samoiliuk, M. (2023, May 30). Management of the public debt of Ukraine during the war and the post-war period. Retrieved from ces.org.ua/management-of-the-ukrainian-public-debt/ [in Ukrainian].
12. Cabinet of Ministers of Ukraine. (2021). On the approval of the Procedure for the exercise of powers by the State Treasury Service in a special regime under martial law (Decree No. 590, June 9). Retrieved from zakon.rada.gov.ua/laws/show/590-2021-%D0%BF#Text [in Ukrainian].
13. Pavlysh, O. (2023, January 10). Inflation in Ukraine in 2022 was 26.6% - State Statistics Service. Economic truth. Retrieved from www.epravda.com.ua [in Ukrainian].
14. Dankiv, V. I., & Halas, M. I. (2013). The role of the budget in the socio-economic development of the state. Scientific Bulletin of Uzhhorod University, 3 (40), 219–226. Retrieved from dspace.uzhnu.edu.ua/jspui/handle/lib/2082 [in Ukrainian].
15. Oparin, V. M. (2005). Financial system of Ukraine (theoretical and methodological aspects). Kyiv: KNEU [in Ukrainian].
16. Radionov, Yu. D. (2023). The Role of the State Budget in Ensuring the Defense Capability of Ukraine. In Transformation of Ukraine's economy: formation of an inclusive economy system and functionality of financial inclusion, pp. 183–201. Riga: Baltija Publishing [in Ukrainian]. doi.org/10.30525/978-9934-26-321-7-9
17. Bilous, O. (2023, April 12). The State Statistics Service estimated the decline in the economy of Ukraine for 2022. RBC-Ukraine. Retrieved from www.rbc.ua/rus/news/derzhstat-dav-otsinku-padinnya-ekonomiki-1681302631.html [in Ukrainian].
18. IBF. (2023, September 11). The government of Ukraine expects GDP growth at the level of 3-4% this year - Svyrydenko. Retrieved from ibf.ua/articles/urjad-ukra%D1%97ni-cogor%D1%96ch-och%D1%96ku%D1%94-zrostannja-vvp-na-r%D1%96vn%D1%96-3-4-sviridenko-161206 [in Ukrainian].
19. Bohdaniok, O., & Melnyk, K. (2023, June 21). Shmyhal: Ukraine considers 10 key aspects of Ukraine's recovery. Suspilne. Novyny. Retrieved from suspilne.media/512285-smigal-ukraina-rozgladae-10-klucovih-aspektiv-vidnovlenna-ukraini/ [in Ukrainian].
20. UA Prom. (2023, June 22). Shmyhal predicts a boom in the development of the military industry in Ukraine after the war. Retrieved from uaprom.info/news/189214-shmigal-prognozuye-bum-rozvitku-vpk-ukrayini-pislya-vijni.html [in Ukrainian].
21. Association Agreement between Ukraine, on the one hand, between Ukraine, on the one hand, and the European Union, the European Atomic Energy Community and their member states, on the other hand (2014, June 27). Retrieved from zakon.rada.gov.ua/laws/show/984_011#Text [in Ukrainian].
22. Radionov, Yu. (2022). Methodological and organizational approaches to ensure the efficiency of management and use of budget expenditures. Finance of Ukraine, 5, 7–28 [in Ukrainian]. doi.org/10.33763/finukr2022.05.007
23. Makohon, V., & Adamenko, I. (2023). Financial policy of the state in the system of economic development. University Economic Bulletin, 56, 193–200 [in Ukrainian]. doi.org/10.31470/2306-546X-2023-56-193-200
24. Verkhovna Rada of Ukraine. (2018). On the approval of medium-term budget planning in Ukraine (Act No. 2646-VII, December 6). Retrieved from zakon.rada.gov.ua/laws/show/2646-19#Text.
25. Verkhovna Rada of Ukraine. (2015). About the legal regime of martial law (Act No. 389-VIII, May 12). Retrieved from zakon.rada.gov.ua/laws/show/389-19.
26. Verkhovna Rada of Ukraine. (2023). On making changes to the Budget Code of Ukraine to ensure predictability of budget policy and strengthening debt sustainability (Act No. 3278-IX, July 27). Retrieved from zakon.rada.gov.ua/laws/show/3278-20#Text [in Ukrainian].
27. Chuhunov, I. Ya. (2021). Budget strategy of social development. Kyiv: KNTEU [in Ukrainian].