Identification of the impact of budget decentralization on the economic security of the region

Abstract

Ensuring the economic security of the region by strengthening the impact of budget decentralization is one of the priorities of the current stage of development in Ukraine. The article analyzes the groups of risks to the economic security of the region caused by the implementation of the budget decentralization reform (related to the territorial aspects of budget decentralization caused by the effect of scale, managerial, economic, and financial ones). The main advantages and disadvantages of budget decentralization in comparison with the centralized system of interbudgetary relations are determined. The defining advantage of budget decentralization is the possibility of increasing the allocative efficiency of public services provided. The risks of budget decentralization implementation in Ukraine are systematized, their analysis is carried out and the directions for their prevention are outlined. As a result of the analysis of advantages, disadvantages and risks of decentralization processes in the budget system of Ukraine, it is reasonable to say that the budget decentralization contributes more to the growth of income potential of regions, quality and reasonable satisfaction of social needs at the local level, ensuring a reasonable distribution of financial resources between individual territorial entities. It is proved that the budget decentralization has a positive effect on the level of economic security of the region, stimulates its financial autonomy, search for additional own resources, activation of internal development potential, allows balancing the needs and opportunities of regions.

Keywords

• decentralization
• budget decentralization
• risk
• advantages
• disadvantages
• economic security of the region