Ukraine's govt approves public finance management strategy untill 2021

Ukraine's govt approves public finance management strategy untill 2021The public finance management strategy for 2017-2021 approved by the Ukrainian government at a meeting on Wednesday implies the introduction of the medium-term budget planning and the creation of an independent body to access the feasibility of macroeconomic forecast and national budget revenue forecast.

"We will send money to the most important directions and fully provide for the key reforms with financial resources. We cannot afford to live with inherited budgets making slight changes to them," Ukrainian Finance Minister Oleksandr Danyliuk said, presenting the document.

He said that the principle of setting clear priorities used to shape the 2017 national budget is also included in the adopted strategy.

"We would have to choose what services we as the state are to quit and what services we can provide at the smaller price or in the smaller volumes. The introduction of the strategic forecasting and medium-term budgeting would help us to determine these priorities and find resources for their implementation," Danyliuk said.

The Finance Ministry said that this means the distribution of budget funds to meet top priorities for the period of three years and setting the clear development goals for five years and the key efficiency indicators for assessing the implementation of the strategy.

The minister said that the essential problems of the current public finance management are vagueness in the budget planning sphere, the low quality and high cost of services, focusing on expense control and observation of formal requirements.

Danyliuk said that the designing of the strategy is one of Ukraine's commitments to the EU and the International Monetary Fund (IMF). The World Bank and the German government provided assistance in drawing up the strategy.

He said that the key tasks of the document include the observation of budget discipline, the provision for the effective implementation of the budget, growth of transparency and reporting relations in the public finance management.

The top priorities are continuation the tax system reform aimed at enhancing the predictability of the tax policy, increasing the quality and effectiveness of administration and expanding the base.

"The key task is to reduce tax pressure," the minister said.

According to the ministry, the strategy consists of four sections: the observation of the general budget and tax discipline, the increase of resource distribution efficiency, the provision for the effective implementation of the budget and the increase of transparency and improvement of reporting relations.

The government would design the national action plan to implement the strategy at all level in the next four months.
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