Content
In April 2023, the government launched a pilot project aimed at restoring a number of localities affected by the war. The project was to be distinguished by its comprehensive approach — not merely rebuilding individual structures or infrastructure facilities, but engaging in holistic planning and transformation of the affected localities or their parts.
The initiative was expected to generate new, effective solutions for restoring localities whose infrastructure had suffered severe destruction due to Russian aggression and required a comprehensive, rather than fragmented, recovery approach.
Six localities were included in the experiment:
- The urban-type settlement of Borodianka and the village of Moshchun in Kyiv region
- The town of Trostianets in Sumy region
- The village of Posad-Pokrovske, located on the border of Kherson and Mykolaiv regions
- The village of Tsyrkuny in Kharkiv region
- The village of Yahidne in Chernihiv region.
However, issues arose within the first year of implementation.Due to the lack of a unified approach to selecting recovery projects, the reconstruction of the village of Moshchun was effectively excluded from the experiment. Out of more than 300 planned restoration projects, only one was fully completed.
In mid-2024, TI Ukraine identified several factors that hindered the success of the project’s first phase — from regulatory gaps to an unstable situation in the leadership of the experiment’s key stakeholders: the Ministry of Infrastructure and the Recovery Agency.
Another year has passed, and we decided to assess what progress has been made in implementing the comprehensive restoration experiment.
Summary
Over the two years of implementation, the experimental comprehensive recovery project has failed to reach the expected scale: only about 8% of the planned facilities have been restored. For the majority (64%), work either began or gained momentum only at the end of last year.
The state allocated ₴10.82 billion for the recovery of the selected settlements — 93% of the project’s expected cost. However, due to significant delays in disbursing the funds, the project is unlikely to be completed on time. As of May 2025, only ₴2.23 billion — roughly 20% — had been spent.
Due to gaps in the experiment’s conditions, the reconstruction of the village of Moschun was essentially excluded, and later, the rebuilding of Tsyrkuny was put on hold.
According to the conditions, 2025 was supposed to be the final year of the experiment’s implementation. However, according to the Recovery Services, in at least two settlements — Trostianets and Borodianka — work will not be completed before 2026. Will the government give the Recovery Agency and its regional services the opportunity to see the experiment through?
The more than twofold increase in funding and the list of facilities planned for restoration over the past year suggests such a scenario is possible. The final fate of the experiment, however, may be determined by the project review initiated by the government in April of this year. According to the head of the Recovery Agency, international experts will also be involved, and their findings are expected to be made public in the fall.
It is now crucial to take into account the mistakes made in order to avoid repeating them in the future — both during comprehensive recovery, which will be essential for large-scale postwar reconstruction, and during the implementation of other experimental projects designed to test new approaches to rebuilding.
New projects, old problems
At the start of the project, it included 295 restoration sites, distributed as follows:
- 268 – housing
- 10 – social infrastructure
- 8 – administrative buildings
- 7 – road infrastructure
- 2 – utilities.
Over the past year, the government revised this list twice. As of March 2025, the number of sites had grown to 739 — more than double the original number. This substantial increase was driven by the addition of housing infrastructure to be restored in two localities — Posad-Pokrovske and Borodianka.
The expansion of the list of restoration sites created the need for additional funding. As of 2025, the total expected cost of restoration under the pilot project had risen to UAH 11.6 billion — UAH 1.63 billion more than in 2023.
In the final year of the project’s implementation, the funding amount increased significantly. In 2025, the state budget allocated UAH 5.2 billion — more than double the amount allocated the previous year, and nearly as much as in the two previous years combined. On paper, the state has financed the comprehensive restoration of the selected localities in the amount of UAH 10.82 billion — 93% of the estimated value. However, this figure differs drastically from the actual expenditures on the implementation of the experiment.
Over the course of the project’s implementation, 83% of the funds used (UAH 1.85 billion) were directed toward the restoration of Borodianka and Posad-Pokrovske. Yahidne in the Chernihiv region fared the best — over a third (37%) of its restoration funding needs were met. The fewest funds were spent on restoring Tsyrkuny in the Kharkiv region — just over 1% of the expected need.
Overall, according to the contracting authorities (the Kyiv Regional Military Administration and regional Restoration and Infrastructure Development Services), as of May 2025, only UAH 2.23 billion had actually been spent on implementing the experiment. This represents approximately 20% of the total expected cost of the comprehensive restoration project.
In 2023, of the more than UAH 3.35 billion allocated for the comprehensive restoration of selected localities, only UAH 559 million was used. The effective use of funds was hampered by a lengthy project selection process and delays in financing. As a result, regional restoration services were only able to start announcing tenders five months after the official launch of the pilot project — and just three months before the end of the fiscal year. Later, the lack of funding led contractors to suspend their work.
In 2024, the situation with comprehensive restoration deteriorated further. Due to political instability and continued dismissals of leadership at the Ministry of Infrastructure and the Recovery Agency, project funding was halted, and most of the work came to a standstill.
The project resumed only in November 2024, when restoration services regained the ability to make payments for completed work. However, funding ceased again at the start of 2025 due to the end of the fiscal year. As a result, restoration services were able to use only UAH 503 million out of the allocated UAH 2.2 billion. Thus, in less than two years of the project’s implementation, the procuring entities were able to fund restoration work and services for just six months in total.
Only in 2025 were funds for the implementation of the pilot project allocated in a timely manner — budget appropriations were opened at the end of March. According to the Recovery Agency, as of May, procuring entities had managed to use UAH 1.19 billion out of nearly UAH 3.5 billion.
No money — no results
Delays in funding during the first two years of the project’s implementation directly impacted the pace and overall condition of the comprehensive restoration of the selected localities.
According to the Restoration Services, as of mid-June 2024, project documentation had been developed for 260 restoration sites, representing 88% of their total number (prior to its subsequent revision). Construction and repair work was ongoing at 211 sites (72%), and only one site was fully restored in the first year of the pilot project — a section of roadway passing through the village of Posad-Pokrovske.
However, during the second year of implementation, the project still did not reach the expected level of progress. In addition to the previously mentioned funding issues, another obstacle was the inclusion of nearly 450 new restoration sites. While the number of sites increased, the project implementation timeline was not extended.
As of early June 2025, according to the Restoration Services, project documentation had been developed for 492 sites (67% of the total), and construction or repair work was underway at 472 sites (64%). Over the past year, works were completed at 57 sites in the village of Yahidne in the Chernihiv region, bringing the total number of fully restored sites to 58 across two years of the pilot project in five localities.
Procurement transactions
According to data from the BI Prozorro public analytics module, from June 2024 to June 2025, contracting authorities announced 373 procurement transactions related to the pilot restoration project. For comparison, 237 tenders were announced during the first year of the project.
During the analyzed period, the vast majority of the estimated value — 97% — came from procurement transactions conducted through special open bidding, amounting to nearly UAH 8.11 billion. These procedures primarily resulted in contracts for the construction of new sites or major repairs of existing infrastructure.
Meanwhile, 3% of the estimated value came from direct contracts, which mostly involved the procurement of project documentation development, as well as technical or author supervision. Although there were more of these transactions in number — 254 compared to 119 — they involved relatively small amounts.
In the first year of the pilot project, the distribution by procurement method was approximately the same: UAH 3.1 billion (over 97.5%) went to special open bidding, and the remaining 2.5% to direct contracts.
Among the leaders in terms of the number of procurement transactions is the Kyiv Regional Military Administration, which announced 154 tenders and awarded contracts worth over UAH 2.85 billion. In second place is the Restoration Service in the Kherson region — 93 procurement transactions totaling nearly UAH 2 billion. Rounding out the top three is the Restoration Service in the Kyiv region, which carried out 77 procurement transactions with a total contract value of UAH 1.1 billion.
The lion’s share of all awarded contracts — 98% of the total value — related to new construction and major repairs of damaged infrastructure. These contracts amounted to approximately UAH 5.9 billion. Another 2% (over UAH 86 million) were for the development of design documentation and related services. Contracts for technical and author supervision services totaled UAH 33 million, accounting for 1% of all contracts by value.
The largest share of all contracted funds — UAH 2.83 billion, or 47% of the total amount — was allocated to the restoration of apartment buildings. Nearly all of this sum was spent in a single locality — Borodianka in the Kyiv region. Another UAH 1.3 billion (21.5%) went toward the repair and reconstruction of private housing, primarily in Posad-Pokrovske.
Almost the same amount — UAH 1.2 billion — was spent on restoring utilities and road infrastructure, including national highways. The smallest portion — UAH 605 million, or just 10% of the total — was allocated to the restoration of social infrastructure facilities.
On average, 2.25 bidders participated in open tenders — nearly twice the average level of competition in construction tenders on Prozorro. However, this is lower than during the same period in the first year of the pilot project (3.6 bidders). The highest competition was recorded in procurements run by the Kyiv regional service — over 3 bidders per lot on average.
Just like the level of competition, the “savings” rate — how much lower the awarded contract price was compared to the estimated value — also dropped significantly. On average, procuring entities saved 7.5% on competitive lots, compared to 21% in the first year. The Restoration Service in the Sumy region reported the highest “savings” rate, at 22.6% — three times higher than the project average. The Kyiv regional service also demonstrated strong results with over 17% in estimated “savings.” For other authorities, the savings rate remained within the 3–5% range.
An analysis of material prices in cost estimates showed that, overall, contractors used market-level pricing. However, some deviations were observed, mostly incidental rather than systematic.
For example, in the construction of a multi-apartment residential building at 353 Tsentralna Street in Borodianka, an overpayment of more than UAH 11 million could result from inflated reinforcement steel prices. The cost estimate includes a price of UAH 35,000 per tonne, while the market price ranges from UAH 26,000 to 28,000 per tonne. It’s worth noting that this price is dynamic, meaning the contract value may change during project implementation.
Another case involves the construction of private houses on Pryozerna and Sadova streets in Posad-Pokrovske, where an overpayment of over UAH 16.3 million may occur due to the inclusion of aerated concrete blocks in the estimate at a price 20% higher than that of market suppliers. Furthermore, the contract uses a fixed-price model, meaning the contracting authority cannot simply adjust the price of materials in the work acceptance certificates.
It is worth noting that during the analyzed period, the State Audit Service monitored 21 procurement procedures, representing 9% of the total number of announced lots. Violations were identified in 19 of them, including issues in tender documentation, disclosure of procurement information, the procedure for reviewing bids, and the terms of procurement contracts.
Borodianka
In August 2024, the list of restoration sites in Borodianka, Kyiv region, was more than doubled — reaching 77. In particular, 32 apartment buildings, 2 protective structures, a new children’s art school, a dormitory, and the reconstruction of utility networks were added to the project. As a result, the estimated cost of restoring the locality increased by UAH 674 million.
In October, the Kyiv Regional State Administration became the procuring entity for the restoration of 58 sites in Borodianka. Together with the regional Restoration Service, they spent UAH 1.06 billion on implementing the pilot project in Borodianka — only 20% of the locality’s total comprehensive restoration needs. Most of these funds (nearly UAH 800 million) were used in 2025 alone.
As a result, construction and repair works began over the past year at 66 restoration sites in Borodianka (85% of the total), including major repairs of damaged multi-story buildings and the construction of six new buildings to replace those that were destroyed.
However, none of the sites within the pilot project have been fully completed so far. According to the Restoration Agency, major housing repairs are expected to be completed by the end of 2025, while the construction of new buildings is scheduled for 2026.
Trostianets
Since 2024, the list of comprehensive restoration sites in Trostianets, Sumy region, has remained unchanged. As before, it includes several major infrastructure projects, such as the reconstruction of the railway station, the station square, the 40th Army Square (which includes over 20 smaller facilities), and the repair of three sections of the Sumy–Poltava road, two of which are located between Trostianets and the neighboring village of Klymentove.
Back in 2023, UAH 663 million was allocated for the city’s comprehensive restoration. This amount was expected to cover the costs of all the listed projects. However, due to the end of the fiscal year, only UAH 80.6 million — or 12% of the allocated budget — was actually spent.
In 2024, budget complications repeated themselves: out of the allocated UAH 278 million, the regional Restoration Service managed to utilize just under half (UAH 133 million) within two months. By 2025, the estimated value of Trostianets’s comprehensive restoration had increased to over UAH 1 billion, but the state allocated significantly less — only UAH 151 million. In total, from 2023 to 2025, the government allocated UAH 1.09 billion for the pilot restoration of the city, of which only UAH 224.6 million was actually spent.
As of early June 2025, repair work in Trostianets was ongoing at all sites. The Restoration Service in Sumy region expected the major repairs on the Sumy–Poltava road to be completed by the end of June, while reconstruction of the railway station and other projects would likely extend into the following year.
Yahidne
Yahidne in the Chernihiv region is arguably the only locality to show tangible progress within the pilot project.
The village’s comprehensive restoration plan includes nearly 120 sites, yet its estimated value by 2025 was among the lowest (UAH 402 million). This is due to the fact that 96% of the restoration sites are residential properties, and the cost of major repairs for housing is lower compared to other types of infrastructure. Also, the project envisioned the repair of street infrastructure, the village club-library, the construction of a new artesian well, and the creation of a memorial complex.
Over three years, the state allocated a total of UAH 528 million for all these efforts, but due to the same persistent issues with funding delays, only UAH 147 million (28%) had been spent as of May 2025.
According to the Restoration Service in the Chernihiv region, as of the end of April 2025, 56 houses and the village’s street-road network had been restored. In addition, repair works were ongoing at 23 other sites. Overall, major housing repairs in Yahidne are expected to be completed by the end of summer, with new construction projects scheduled for completion by the end of 2025.
However, the implementation of the project in Yahidne was hindered by the specific ownership status of the targeted properties. Under the terms of the pilot, owners of private properties were required to transfer the role of contracting authority to the Restoration Services. In practice, however, private owners ignored this obligation for an extended period or openly opposed it. As a result, the restoration of 21 residential buildings in Yahidne remains blocked due to untransferred procuring entity.
Tsyrkuny
Tsyrkuny is one of the most heavily affected villages in Kharkiv region and, at the same time, the most problematic locality within the pilot restoration project. The village is located 25 kilometers from the Russian border and remains under constant enemy shelling. Under such circumstances, concerns have been raised not only about safety but also about the economic feasibility of restoring infrastructure there.
At the start of the pilot project, only four sites were planned for restoration in Tsyrkuny:
- the village council building (intended to house an Administrative Services Center)
- the local clinic
- a kindergarten
- a lyceum.
The Restoration Service announced tenders for emergency recovery works on the lyceum and clinic. However, only a contract for the reconstruction of the lyceum was signed — and it was later terminated due to lack of funding. In August 2024, both of these sites were removed from the restoration list.
As for the remaining two sites — the village council building and the preschool — project documentation had been developed as of May 2025. Also, Tsyrkuny became the only locality for which a full restoration concept was developed at the request of the Restoration Service. A total of UAH 5.97 million was spent on this work.
Whether these projects will be implemented remains uncertain. Back in 2023, discussions began about replacing Tsyrkuny with another locality in the region under the government project. However, the idea met resistance from local residents, for whom the pilot was the only hope for restoring the village. As a result, the proposal was soon dropped. Ultimately, in January 2025, the head of the Kharkiv Region Restoration Service announced that due to the security situation, the pilot project in Tsyrkuny had been put on hold.
Posad-Pokrovske
In 2025, Posad-Pokrovske in Kherson region retained its status as the locality with the highest number of approved restoration projects. Since 2024, their number has increased more than fourfold — primarily due to the addition of 388 housing infrastructure sites. As a result, the total cost of restoring the village rose by more than 40%.
Between 2023 and 2025, the government allocated over UAH 3.7 billion for the comprehensive restoration of Posad-Pokrovske — the highest amount among all pilot localities. At the same time, the Restoration Service in Kherson region managed to use UAH 789 million — just 21% of the allocated funding.
The first 120 sites in Posad-Pokrovske were scheduled for restoration by April 2024. However, due to problems with transferring procuring entity from private owners and delays in funding disbursement, progress was slow and work on several sites was halted altogether. Nevertheless, the village became the first locality where restoration works were completed under the pilot — though not on a residential building, but on a road that runs through the village and connects Mykolaiv and Kherson.
As of May 2025, the issues with private owners had been resolved, and a substantial budget — over UAH 2.2 billion — was allocated for the village’s restoration (only Borodianka received more funding that year). As a result, construction and repair works resumed and were underway at 364 sites, with one (the road) already fully restored. However, given the scale of comprehensive restoration in Posad-Pokrovske, completing all works by the end of the pilot project does not appear realistic.
Висновки
Over the two years of implementing the pilot project on comprehensive restoration, construction and repair works were fully completed at only 58 sites, approximately 8% of the total. For the vast majority of other sites (64%), work began or resumed only at the end of the previous year.
Between 2023 and 2025, the state financed the comprehensive restoration of selected localities in the amount of UAH 10.82 billion — 93% of the estimated value. However, problems with the actual disbursement of these funds to the procuring entities over two consecutive years effectively nullified the possibility of timely and efficient implementation. As of May 2025, only UAH 2.23 billion had been disbursed — approximately 20% of the total estimated value of the entire comprehensive restoration project.
According to the terms of the pilot, 2025 is supposed to be the final year of implementation. However, according to the estimates of the Restoration Services, in at least two localities — Trostianets and Borodianka — the completion of construction and repair works is not expected before 2026. An analysis of the progress in other localities suggests that this timeline may be realistic for them as well, given the slow pace of work and the fact that many sites have not even entered the active construction phase.
Will the government allow the Restoration Agency and its regional services to complete the pilot? The doubling of funding and the number of restoration sites planned for the previous year suggests that this scenario remains possible. Still, the final decision may depend on the outcome of the project review launched by the Cabinet of Ministers in April this year. According to the head of the Restoration Agency, international experts will be involved in the review process and are expected to deliver their conclusions by autumn.
Research team
Project Lead:
Ivan Lakhtionov, Deputy Executive Director of Transparency International Ukraine for Innovative Projects
Author:
Andrii Shvadchak, Legal Counsel at Transparency International Ukraine
