Bìznes Inform (Oct 2019)
The Budgetary Financing of Social Services in Ukraine: Features and Prospects for Development
Abstract
The article is aimed at disclosing features of the budgetary financing of the State-guaranteed social services in Ukraine and defining development prospects, taking into account the emerging internal and external risks and available budgetary opportunities. Based on a study of the dynamics of the expenditures according to the Consolidated Budget of Ukraine for 2015-2018, the leading position of the expenditures for social needs is proved. The main macro-economic and institutional factors influencing the volume of budgetary financing for social services are defined. It is noted that the volumes of annual expenditures for the social sphere in Ukraine tend to increase year to year. However, distribution of expenditures by the State functions is fairly uneven and unreasonable. The structure of expenditures accounts for the largest share of social protection and social security, in particular the social protection of pensioners. The peculiarity of financing social services in Ukraine is that the lack of funds in the extra-budgetary Pension Fund of Ukraine is covered by transfers from the State budget, which contradicts the current norms of the budget legislation, renders the idea of building a cumulative pension system impossible, and reduces the possibilities of budgetary manoeuvre in favor of other social expenditure items, such as education and health. Prospect for further research in this direction is to reason the need for reforms in the sphere of budgetary policy, improving the mechanism of financial provision for social services guaranteed by the State through the gradual introduction of a cumulative pension system, compulsory health insurance and a gradual transition from the estimated financing of the providers of social services to another form of direct financing - order for social services.
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