OREANDA-NEWS. February 04, 2011. The 8th session of the Verkhovna Rada of Ukraine has begun.  It is of special importance for us.  Just that very session  is called to create a legal field for all the systemic reforms that are being carried out by the President? The Government, the Parliament. The Government has already worked out 117 bills aimed at achieving that goal. Each of us will need his maximum of political will, of self-discipline and the unity of action.

Parallel to adoption of the laws the Government should approve the normative documents that ensure the fulfillment of the laws very promptly and in a balanced way as well as strictly control their accomplishment.

On Monday the Government published the National Plan of reform implementation – with clearly defined directions and terms. And we will rigidly fulfill it. 

Dear colleagues!
The first and most difficult months of the year has come to an end. January is important as a starting point that defines the development trajectory within the year. So, what can I say about the start? According to the current official statistics, in January the inland revenues reached over 19 billion UAH. Compared to the same period last year it makes an increase of 3,31 billion UAH or 21 %.

The pension fund, Chernobyl payments, food and medication in the hospitals, housing subsidies, tuition at higher educational establishments and other public expenses have been 0ne hundred percent financed.

At the same time January has also revealed some problems. The Government analysis showed that some local officials have remained in the coordinate system that has been formed at the height of the crisis. Local revenues have also grown by comparison with the last year. Local account balances show about 10 billion UAH. And at the same time their public utilities arrears have reached 3,2 billion UAH. How can one tolerate such a situation? There are no objective reasons for such arrears, it is obvious, indeed. What other urgent local budgets’ expenses could be if the natural gas used has not been paid for? In reality it is unscrupulousness and lack of discipline of some local officials. 

Neither can I observe the principal position of the Ministry of fuel and energy that has not laid down any strict conditions to the debtors. That is why I demand to summon to the next Government session the biggest debtors, regional leaders that allow themselves not to pay, and we will seriously and in essence sort the case out with them at the Cabinet of Ministry session.
 
Dear colleagues!
In 2011 the process of improving the social standards is going on. In particular, the minimum wage, the minimum of subsistence, pensions, child and birth allowance will be increased.

The minimum of subsistence for children under 6 years will be increased up to 870 UAH, for children from 6 to 18 years – up to 1042 UAH, for the able-bodied – up to 1004 UAH.

I’d like to emphasize that in 2011 we’ve aimed to finally equalize the minimum wage and the minimum pension with the appropriate minimum of subsistence

The Government is paying special attention to the social security of low income families with kids. In 2011 the subvention to the families with kids, low income families, disabled children as well as temporary public payments will be increased by about 4 billion UAH compared to the last year and will reach 26,4 billion UAH.  

Since 2011 we have introduced a system of birth allowances depending on the minimum of subsistence. 

Besides the state subvention to the families with kids, the disabled since childhood, the disabled children as well as temporary public payments will be growing during 2011 in accordance with the growing of the minimum of subsistence. 

I remind everyone that the minimum amount of help to the unsecured persons in case of pregnancy and childbirth will grow up to 1054 UAH, and the minimum amount of help to the children guardianship will increase for children under 6 – up to 1760 UAH, for children from 6 to 18 years – up to 2084 UAH. 

So, the Government is creating a quite a wide “social field” of financial support and care over the families with kids. We would surely like to widen that field and its financing, but the means for that could be received only from the economy that is growing.

Nevertheless, the resources that we have in the country are also quite substantial, we should make use of them, I would say, in an impeccable way. The Ministry of social policy and labour should do its best to ensure that the mechanism of the state social support were functioning as a clockwork.

Everything I said concerns the support of the most vulnerable sections of the population. The state support should ease the situation of those people under today’s difficult conditions. The Government will do its best to soften the way out of the crisis for such unprotected vulnerable citizens in a maximum way. Even notwithstanding the tariffs increase and unfavorable pricing situation at the food market.

We will not allow decline in living standards in the country. On the contrary, growing of the active income of the population is the foundation of our way out of the crisis.

I’d like to remind everyone that last August the Government has taken an unprecedented decision and ruled out that communal utility payments should not exceed 15 % of the joint income for those who work and 10 % for the people on pension. The state has taken upon itself the support of the citizens in the situation of tariff increase. That is why there should be no speculations of the type that a pensioner who receives a 1000 UAH pension will have to pay 600 UAH for communal utilities. The maximum payment for those who have, say, 1000 UAH will be not more than 100 UAH. The rest will be paid by the state.

I emphasize once again, the Government granted local authorities and social security offices with wide powers to take a separate decision in each case when the examination of a financial situation of a family has proved that the family needs help.

But those who can pay, who have sufficient income, should pay. For, despite all the speculations that the financial situation of people has worsened, last year the average wages grew by 400 UAH per month. In other words people get on the average 5 thousand UAH per year more. And we will proceed with our policy of a balanced growth of the real earnings of the population, so that even under the conditions of tariffs growth their living standards and payable demand do not deteriorate.

Dear colleagues!
The Government is proceeding with implementation of the Decree of the President of Ukraine "On measures to ensure the effective realization of the Economic reforms programme for 2010-2014 "Wealthy society, compatible economy, effective state".

First of all the deregulation of economic activities is meant.

This year we have to finally put an end to the issue of maximum licensing reduction. And in a stable way, steadily implement that decision.

Yesterday I met the managers of one of the largest corporation of the world – "Chevron". They want to invest into slate gas production in Ukraine. These deposits are difficult for development, and investment needed are very big. 

But "Chevron" is ready to invest. Under two conditions, the investors said: political stability and immutability of taxation rules.  These are the main two conditions. And such position of "Chevron" is not an exception. All my meetings with investors show: they are ready to invest in Ukraine only if we had political stability and the playing rules at the "economic field" would not be changed.

This has to be understood by everyone: if we want wealth in our country, growth of living standards, by no means should we jeopardize stability. It is our great gain.  .

Yesterday the next IMF mission in Ukraine started its work. Its head has positively assessed the results of the socio-economic development of Ukraine in 2010. This objective estimation is the best answer to the Government’s opponents.

But in 2011 we are facing very difficult tasks. So, I remind once again, that each Government member, each official in the frame of his authority is personally responsible for adherence to our obligations in front of IMF and meeting the criteria agreed.

The IMF support under the indefinite conditions at the world markets, bursting out of crisis effects is extremely important to us. 

Today the Government will discuss the Programme of investment and innovative development for 2011 and for the period till 2015. This is a strategic document. It will define the development of our economy for the middle-term perspective and will lay down the foundation for the basic structural changes in the economy.

I emphasize that the state support is only a catalyst for attracting private investments. The main resource of modernization is companies’ own funds, obtained funds including bank credits, resources of international financial organizations. We predict that as a result of our activities we will be able to attract additionally 100 billion UAH of investment that will enable the additional GDP growth by 1,5-2,5 %.

The system of state stimuli has to enable us to attract 4 to 6 UAH of private investment for each hrivna of state funds.

In such a way the so called "growth points" will be created that will become a development basis for hi-tech branches and regional advance.

The Programme identifies the concentration of investment and scientific- technical resources of Ukraine at the main objectives: general modernization of the economy, growth of the high-tech production share, creation of high-productive jobs with high payment level. 

Energy intensity of Ukrainian GDP is one of the highest in the world.  It is 2,5 times higher than the average energy intensity level of GDP in the developed countries.  That is why the improvement of energy effectiveness is the general priority of the modernization programme. 

Focus of investments at the innovative projects should promote industrial production and labour productivity.

The average yearly rate of production growth in 2011-2012 is being predicted at a level of 7-8%, and in 2013-2015 – at 9-10%.

The general part of machine-building in the general industrial structure should increase up to 20 %.

Our aim is to gradually bring the industrial structure of Ukraine closer to that of the developed countries of Europe and the world, to significantly increase its competitiveness.

This issue is at the top of the agenda, and I propose to make the appropriate speech of Andriy Klyuev open to the press if the members of the Government do not object to it.

About the agenda.
Today we will take a Government decision that will render state support to the cities that will renew their bus and trolleybus fleet in the frame of preparation to the EURO-2012.

We will discuss the draft changes to the Government resolutions that widen the list of economic players in the field of aircraft-building. It will promote the renewal of domestic aircraft-building.
There will be also examined a draft of a Frame partnership programme of the Government of Ukraine and the UN for 2012-2016 that foresees the following directions: sustainable economic growth and fighting poverty; social development; management;

Environment and climate change.

At today’s session we will discuss the decision to transfer the revenue of the state “Eximbank” to increasing of its authorized capital stock. Increase of the capitalization level of the bank will widen its possibilities to take part at the large-scale investment projects and programmes, attract more credit resources.

The Government is going on with its work on adapting the normative and legal documents to the Tax code of Ukraine. We will take a number of appropriate decisions today.

We will also consider the Basic civil defense plan for 2011.

We will discuss the draft resolution that improves the technological scheme of the state border crossing. In particular we will specify the procedures of: border crossing by persons and freights; security of air and water services; carrying out of joint control at the territory of Ukraine and beyond its border by the control authorities of Ukraine and the neighboring states.

This year we will celebrate the 20th anniversary of the independence of Ukraine. At today’s session we will adopt the action plan for preparation and celebration of the 20th anniversary of the independence of Ukraine.

Among the planned events: honoring the memory of the outstanding Ukrainian state builders, fighters for its independence, warriors that died for the freedom of Ukraine; organizing of interregional public forums; publication of the anthology of Ukrainian literature and transferring part of the circulation to the libraries and educational establishments – first of all in the rural regions; organizing of cultural events with par5ticipation of professional and amateur groups; organizing of the yearly All-Ukrainian competition “Place of best utility and public order”; organizing of festive events outside Ukraine with participation of Ukrainian communities abroad.

We will also approve the steps aimed at realization of the laws of Ukraine adopted at the end of December 2010, namely: "On steps aimed at sustainable functioning of enterprises of the fuel and energy complex", "On amendments to the Law of Ukraine "On the fundamentals of the social defense of the homeless citizens and children"; "On the fundamentals (strategy) of the state ecology policy for the period till 2020".