Financial decentralization of united territorial communities in Ukraine (Decentralizacja finansów zjednoczonych wspólnot terytorialnych na Ukrainie)

Abstract

Since 2014, Ukraine has undergone dramatic changes in the direction of power’s decentralization and the reform of local self-government was started. Prior to the reform, the overwhelming majority of Ukrainian territorial communities, having the right to resolve local issues, could not perform them, due to lack of own funds, decay or absence of infrastructure (necessary buildings, structures, roads etc.), as well as lack of the appropriate personnel’s qualification. Much of the local issues were not adequately addressed – schools and hospitals and other buildings of communal property were not kept, landscaping, street lighting etc. were not provided. The basis for the decentralization of power and financial authorities of the states was the reform of financial decentralization, which in this regard involved the process of distribution of functions, powers, financial resources and responsibilities between central and local levels of government, as a result of what happened not only the improvement of the efficiency of management of budgetary funds, but also reducing of the center’s impact on the development of regions and regional economies. In general, financial decentralization was intended to strengthen the capacity of the united territorial communities (hereinafter the UTC) and increase the level of socio-economic development of the regions.