To fight against the new coronavirus, the Parliament of Ukraine is planning to create a dedicated fund. This is provided in the new version of Ukraine’s 2020 budget.

Unlike the previous draft budget, which never gained enough votes to be passed, in this version the amount of money allocated to this fund has reduced almost by half: from UAH 124.2 billion to UAH 64.7 billion.

The reduction of the amount does not mean that less money will be allocated to fight against COVID-19. Some of the funds will go to other programs. For instance, the Retirement Fund and the Ministry of Healthcare will both receive extra money in light of the pandemic.

The Fund will be getting money not just from the national budget, but also from the EU, other governments and donor organizations. The decisions on allocation of money to the Fund will be made by the Cabinet of Ministers and approved by the Budget Committee of the Verkhovna Rada.

This approach will enable the Government to react to pandemic-related threats rapidly and make fast decisions. On the other hand, this “manual” management carries certain risks, since there is no guarantee of transparency, accountability and efficiency. As of now, there is no oversight of how the money from the Fund will be spent.

TI Ukraine emphasizes that while concentration of power makes sense in the situation of a pandemic, it should not lead to abuse of power. Transparency of allocation of funds should become a priority which will help to report on the decisions made today in the future.

The money from the Fund will be spent on:

  • procurement of goods, works and services;
  • additional payments to medical staff directly involved in the fight against the pandemic;
  • financial assistance to citizens, including the elderly;
  • one-time financial aid to family members of healthcare workers who die in the line of duty;
  • a transfer to the Retirement Fund;
  • financial aid to the Social Insurance Fund and the Mandatory National Social Insurance Fund in the event of mass unemployment;
  • transfers to local budgets and loans to budget programs suspended in connection with creation of the Fund.

The Fund will function throughout the quarantine and for 30 days after its end.