PARLIAMENT BEGINS HEARINGS ON 2000 DRAFT BUDGET
KYIV. Oct.7, Ukraine's finance minister, Ihor Mityukov, submitted to
parliament the draft of the state 2000 budget, with a UAH 554 million
surplus, or 04% of the GDP. The head of parliament's budget committee,
Yuliya Tymoshenko, said the budget is unreal, since it has been based
on unreal macroeconomic indicators.
According to the government experts, the expenditure is set at
26,515,907,700 and the revenue at UAH 27,070,447,700. The GDP is set
at UAH 150.8 billion, or up 2% on the 1999 level. Payments on foreign
and domestic debt are set at UAH 16.4 billion. The government sets UAH
2.237 billion for defense, UAH 2.182 billion for education and UAH
2.581 billion for social programs. Revenue from taxes is set at UAH
17.267 billion.
The head of the budget committee said that the proposed budget will
hardly be implemented because the government was too optimistic about
the forecast growth of the GDP. According to the committee experts,
the GDP will shrink by 1%, not grow by 2% as the government predicts.
She also said that the government actually ignored the budget
resolution, specifically the ban to submit a draft budget with a
surplus. She also pointed out that the government expects to cover
most of the expenditure by concentrating in the budget all the 20% of
depreciation deductions, a proposal which parliament has not approved
so far.
The budget committee members were surprised to find that the draft
budget cuts the revenue from rental payments for domestic gas almost
twice (by UAH 214.5 million) and payments for the transit of gas via
Ukraine by UAH 1.089.8 billion. This will only benefit the national
Naftohaz Ukrayiny company - at the expense of the state budget,
believes head of the budget committee, Yuliya Tymoshenko.
Having analysed the draft budget, Ukraine's Accounting Chamber says
the government failed to consider some factors which can raise the
revenue by UAH 4.7 billion while ignoring the factors which may reduce
the revenue by UAH 2.2 billion. The government without valid reason
overestimated the ceiling of the domestic state debt, as of late 2000,
by UAH 9.8 billion, says the Accounting Chamber, while the main
macroeconomic indicators for 2000 have not been substantiated well
enough. Therefore, both the Accounting Chamber and the budget
committee recommend to revise the draft budget thoroughly before it
goes to parliament's first reading debates.
Speaking in parliament, the head of the Reforms and Order party and
former vice-prime minister, Vikltor Pynzenuyk, proposed to impose
rigid control over budget expenditure. He proposed to stop the
construction and renovation of all buildings and offices related to
the branches of power (parliament including), to suspenf the purchases
of equipment and materials for these buildings, to cancel all benefits
to civil servants, lawmakers including, to cancel all non-budgetary
funds and concentrate all the money in a single budget account, to
impose a moratorium on endless state festivities. "Without these
measures, Ukraine will be in for very grave financial slump, due to
large payments on the foreign and domestic debt next year", said
Viktor Pynzenyk.
PRIME MINISTER SIGNS DOCUMENTS WHICH SHOULD ACCELERATE CREATION OF
FREE TRADE AREA WITHIN C.I.S.
SIMFEROPOL. At the meeting of heads of governments of the C.I.S.
countries held in Yalta (Crimea) Ukrainian Prime Minister Valeriy
Pustovoitenko signed 17 documents out of the 22 that had been
approved.
One of the documents he has signed is an agreement on the internal
procedures that are necessary to carry out in order to enforce an
agreement on the creation of a free trade area within the C.I.S. The
Ukrainian delegation insisted at the meeting that the free trade area
be launched as soon as January 2001.
Another document signed by Mr. Pustovoitenko in Yalta is an agreement
on the order of customs clearing and customs control of the goods
moving within the free trade area. Ukraine has also joined the C.I.S.
joint program of combating terrorism and "The Reliable Pipeline
Transport Program". At the same time the Ukrainian Prime Minister
refused to sign a document on allocations in 2000 for the creation and
development of a common air-defense system of the C.I.S.