OREANDA-NEWS. May 17, 2011. Speaking at  meeting of the Governing Council of the Committee on Economic Reforms, President Viktor Yanukovych has drawn special attention to the situation in the housing and communal services in Ukraine.

"The networks are worn, the equipment is outdated and incapable of providing quality hot water and heating services to the population. We cannot change this situation without the introduction of tariff-formation methods that would stimulate the modernization and reconstruction of heating equipment and networks," he said.

The President said that it is fundamentally important to provide a single nationwide approach to tariff formation. "I said that many times before. There must be no current diversity! We have the same people living in all the regions ... How can one region have rates twice higher than those in the neighboring region?" Viktor Yanukovych said.

Addressing Prime Minister Mykola Azarov, President Yanukovych reminded that he had instructed him personally to find a solution to this situation.

"People are asking: why the consumers conscientiously pay 100% of the cost, but receive 50% or even lower service?" he said.

Viktor Yanukovych said that last year’s move to provide a national regulator with the right to set the tariffs for regional monopolies was right. "But we did not provide it with adequate resources, especially professionals, and did not create the appropriate mechanisms of compensation of costs where they are needed.

I repeat: the number of employees must be reduced where the number of functions is reduced, including as a result of deregulation," Viktor Yanukovych added. Where the number of functions is growing, he said, their performance must be backed up by human resources.

"Lack of capacity of the national regulator on one hand provokes social tensions on the ground, and on the other makes it impossible to attract private investment. It also makes upgrading housing and communal systems impossible. I would like to hear today, what specific steps were taken to attract private capital into this area," Viktor Yanukovych said.

The President also noted that in view of the gradual tariffs growth the mechanisms of social protection of vulnerable population must work “like a clockwork”.

“Together with the chairmen of local administrations we need to organize the work so that there were no delays in processing the necessary documents. Or lines," he said, addressing Vice-Prime Minister of Ukraine Serhiy Tigipko.

He expressed confidence that the reform of social security system must be started already. "In its present form it remains outdated, inefficient and corrupt. Five different funds and agencies are functioning in its framework. No developed country can afford that, more so – our country, which is through deep modernization and has limited budget funds," he said.

"I would also like to point out the problem of fragmentation of funds during the realization of regional development programs. But this issue will surely be solved by introducing a new financing mechanism – the Regional Development Fund," Viktor Yanukovych stressed.