Limited Progress and Unclear Prospects: The Pilot Project for Comprehensive Restoration

In April 2023, a government pilot was launched in Ukraine to introduce a new approach to restoring localities that had suffered significant destruction as a result of Russian aggression. Its distinctive feature was to be a comprehensive approach — not just the restoration of individual buildings or facilities, but holistic planning and transformation of affected towns and villages.

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.

The restoration was planned to take two years, with the Agency for Restoration designated as the body responsible for implementing the pilot. The project was expected to serve as a testing ground for solutions that could later be scaled nationwide. 

Last year, we analyzed the conditions under which the pilot was launched and reviewed the outcomes of its first phase. Now, we have assessed the results of two years of work on the comprehensive restoration project and highlighted the key findings of our research.

A lost year for the pilot

Problems arose at the very start of the pilot project. It lacked formal requirements and criteria for selecting restoration sites. In addition, the object lists had to be coordinated through regional military administrations, which dragged the process out until autumn 2023. 

Already at the first stage, Moshchun dropped out of the pilot — the list of restoration sites there was never approved. 

As a result, the project proceeded with only five localities and nearly 300 sites. More than 250 of them were concentrated in just two villages — Posad-Pokrovske and Yahidne. In contrast, in Tsyrkuny, Kharkiv region, only four sites made it into the approved list, raising questions about the rationale for retaining the locality in the pilot. 

The lengthy selection process directly impacted the project’s funding. Regional Restoration Services were able to start procurement only in mid-September, after budget procedures were completed. As a result, only UAH 559 million — 17% of the planned UAH 3.35 billion — was spent in 2023.

In 2024, the key obstacle for the pilot was delayed funding. The funds were allocated only at the end of the year — likely due to instability in the leadership of the pilot’s key stakeholders, namely the Ministry of Infrastructure and the Agency for Restoration. As a result, procuring entities were unable not only to plan new procurement transactions but even to pay for completed work under previous contracts. Some projects were halted altogether, and in several cases, contracts were terminated. 

As a consequence, there was no significant progress in implementing the pilot during its first year. Only one site was successfully restored — a section of road running through Posad-Pokrovske that connects Mykolaiv and Kherson. As of mid-June 2024, construction or repair work was underway on 211 sites (69% of the total). 

Procurement remained almost the only positive aspect of the first year of implementation. In the final three months of the fiscal year, restoration services conducted at least 237 procurement transactions for design documentation, construction, and technical supervision. The level of competition in the tenders was twice the average on Prozorro. As a result, the average conditional savings (the difference between the estimated value and the contract amount) stood at 21%. 

Procurement analysis also showed that, overall, the prices contractors included in their estimates were largely market-based, and deviations were mostly random rather than systemic.

New stage, old problems

Funding for the pilot project was restored only in November 2024, when the Restoration Services regained the ability to make payments for completed works. But just like in 2023, there was very little time left — the fiscal year was once again drawing to a close. 

As a result, only UAH 503 million out of the allocated UAH 2.2 billion was used in 2024. 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.

During the second year of the pilot project’s implementation, the government revised the list of restoration sites twice. As of March 2025, the number of sites had grown to 739 — more than double the original number. This increase was due to a significant expansion of the residential infrastructure planned for restoration in Posad-Pokrovske and Borodianka.

As a result, the total estimated value of the restoration under the pilot project also rose, reaching UAH 11.6 billion, which is 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.

As of May 2025, only UAH 2.23 billion had actually been disbursed for the implementation of the pilot project — approximately 20% of the total estimated value of the comprehensive restoration initiative. Most of this amount — UAH 1.19 billion — was used in 2025, when funds for the project were allocated in a timely manner at the end of March. 

Delays in funding during the first two years of the project’s implementation directly impacted the pace and overall condition of the restoration of the selected localities.

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. 

Notably, procurement performance worsened during the second year. Although the level of competition still exceeded the average for construction tenders on Prozorro, it fell short of the first year’s figure. As a result, the average “savings” rate dropped significantly from 21% to 7.5%. At the same time, the material prices included in contractors’ estimates mostly remained in line with market rates.

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.

Over the past year, construction and repair works began at 66 sites in Borodianka (85% of the total). According to the Agency for Restoration, major housing repairs are expected to be completed by the end of 2025, while the construction of new buildings is scheduled for 2026.

Trostianets

The list of comprehensive restoration sites in Trostianets, Sumy region, includes several major infrastructure projects, such as the reconstruction of the railway station, the station square, the 40th Army Square (which encompasses over 20 smaller facilities), and the repair of three sections of the Sumy–Poltava road. 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.

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.

At the same time, the restoration of some residential buildings in Yahidne remains blocked due to the fact that not all owners have transferred the rights of the construction customer to the Restoration Service.

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. 

Notably, Tsyrkuny became the only locality for which a full restoration concept was developed at the request of the Restoration Service. However, whether it will be implemented remains unclear, as in January 2025, the head of the Kharkiv Regional Restoration Service announced that, due to the security situation, the implementation of the pilot project in Tsyrkuny had been put on hold.

Posad-Pokrovske

Posad-Pokrovske in Kherson region became the first locality where repair work under the pilot project was completed on one of the sites. However, it was not a residential building but a road passing through the village that connects Mykolaiv and Kherson.

In 2025, a substantial amount — over UAH 2.2 billion — was allocated for the restoration of the village (only Borodianka received more). As a result, construction and repair work resumed and is ongoing at 364 sites. Still, given the scale of comprehensive restoration in Posad-Pokrovske, completing it by the end of the pilot project does not appear realistic.

Conclusions

After two years of implementation, the pilot project for comprehensive restoration has fallen short of the expected scale: only around 8% of the planned sites have been restored. For most sites (64%), work either started or gained momentum only at the end of the previous year.

The government allocated UAH 10.82 billion for the restoration of the selected localities — 93% of the project’s estimated value. However, due to significant delays in disbursement, the project is unlikely to be completed on time. As of May 2025, only UAH 2.23 billion, about 20%, had been spent.

Due to gaps in the project’s design, the restoration of the village of Moshchun was excluded entirely, and later, the restoration of Tsyrkuny was put on hold.

Under the original terms, 2025 was supposed to be the final year of the pilot project. However, according to the Restoration Services, restoration works in at least two localities — Trostianets and Borodianka — are not expected to be completed before 2026. The question remains whether the government will allow the Agency for Restoration and its regional offices to see the pilot through. 

The doubling of funding and the number of restoration sites planned for the previous year suggests that this scenario remains possible. The final outcome of the pilot may be determined by a government-initiated assessment of the project launched in April. According to the head of the Agency for Restoration, international experts will also be involved, and their findings are expected in the fall.

It is now crucial to learn from past mistakes — to avoid repeating them not only in the context of comprehensive restoration, which will be essential for the large-scale post-war recovery, but also in future pilot projects aimed at testing new approaches to reconstruction.