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Saturday, January 20, 2018

Third Ukrainian Maidan will be the tariff

Budget of Ukraine in a critical situation: the population is unable to pay for utility services, but money for subsidies for the poor in the Treasury not. The number applying for these subsidies is growing and, according to some estimates, has already exceeded half of the population. In the end, it threatens to provoke the same “tariff Maidan” as the one and a half years ago happened in Armenia.

According to the State statistics service of Ukraine, at the end of October the total debt of the population for utility services amounted to 16,73 billion hryvnia (about 40.1 billion rubles at the current exchange rate). In September, total debt was UAH 4.2 billion (10.3 billion rubles), but the beginning of the heating season is dramatically aggravated the situation.

In the grip of the Holodomor

“Smart Poland is waiting with open arms, and cunning to negotiate with the employers understate wages, thereby reducing revenues”

Most of the increase in defaults occurred in the Central heating and hot water supply – in October, the indebtedness in this segment increased by 21.3% compared to the end of September. There is the fact that the tariffs for heat and hot water were raised by an average of 75-90% from 1 may. As a result, in October the average size of the utility bills have jumped to 325 hryvnia – 851,2 hryvnia (2085 rubles), although this is only the official data.

According to the President of the Ukrainian analytical center Alexander Okhrimenko, made at his press conference in Kiev, after all the planned tariff increases, the average Ukrainian family will receive invoices for utility services on 2000 hryvnias a month (4900 rubles). Meanwhile, in 2015 the average monthly income per family in Ukraine amounted to UAH 5430 (13 320 rubles at weighted average rate for the year). According to Okhrimenko, combined with the ever-rising prices of food and commodities the growth of utility tariffs will take the average Ukrainian all of their income. Therefore, the future consequences quickly dubbed the word “Holodomor”.

About the real level of solvency of Ukrainians on new housing prices proves this fact: in October, the level of payment of assessed amounts was only 56,9% (3.6 billion UAH). And in some regions it was disastrously low: for example, in Kherson region – 27,2%, in Ivano-Frankivsk was 25.2%. In Russia this level of payment of utilities found only in some republics of the North Caucasus.

For comparison, last year the level of calculations was 95%. That is, the previous series of tariff increase population somehow survived, but a new level for a considerable part of Ukrainians was overwhelming. The Ukrainian energy suppliers immediately took advantage of higher tariffs in their own interests: in November, residents of several large cities in the country (in particular, Kiev and Odessa) began to receive bills with the amounts significantly exceeding the cost of housing services even with the raised tariffs.

“We are all with you rabbits Guinea”

Raising tariffs for hot water and heating, the government of Ukraine has decided to sweeten the pot for the least effective groups and announced the extension of the subsidy program, which operated before. In mid-September at the Cabinet meeting alleged that during the heating season grants will receive 9 million Ukrainian households, the amount of compensation from the budget will be at least 52 billion (127.4 billion rubles). According to the Ukrainian Finance Ministry, the total expenditure budget for 2016 was planned in the amount 667,8 billion, that is, compensation for utility tariffs could absorb 7.8% of budget spending.

However, the actual amount of subsidy is significantly less than the declared limits. According to the Ukrainian statistics, in the seven months of the current year subsidies for reimbursement for housing and communal services was assigned in the amount of 2.58 billion USD. At the same time, a dynamic increase in spending on subsidies speaks for itself: over the same period of 2015, they were almost five times less and the number of families who applied for subsidies increased by 73% to 3.7 million, However, the average subsidy per household per year has decreased by almost 20% to 171,5 hryvnia (about 420 rubles).

This statistic clearly suggests that the money for adequate compensation of growth rates from the authorities of Ukraine. Recently this fact (by the way, predicted by analysts) received the following confirmation: 7 Dec Director of Finance Department of Odessa city Council Svetlana Bedrega reported at a briefing that funds for the payment of benefits and subsidies do not come from August, calling the situation critical. And a few days before during a regular press conference of the Ukrainian analytical center reported that the duty of the state to the suppliers of housing services for the grant has already reached 12 billion (29.4 billion) and is growing rapidly. In this context, the September promise of the Cabinet for subsidization 52 billion look like a deliberate bluff.

However, the first reading of the budget the next year deputies of the Verkhovna Rada approved the subsidies on housing prices of $ 51 billion, prompting sharp criticism from the expert community. “Where are these magical subsidies? You understand that this additional taxes. No country in the world in which the reforms 60% of the population went into subsidies. This evidence of the wrongness of macroeconomic reforms. This experimentation Ukrainians, where we are all with you rabbits a Guinea,” said a few days ago on air of the telecast “Schuster Live” Oleksiy Kucherenko, former Minister for housing in the Tymoshenko government (2007-2010), and now President of the Ukrainian Association of homeowners.

The spectre of a new Maidan

The theme of increase of tariffs for housing and communal services quickly acquired a political dimension that in Ukrainian realities inevitably means a return to the Maidan practices. The role of the main fighter with higher tariffs now playing the faction “Batkivshchyna” Yulia Tymoshenko. In mid-November, she spoke at the Council of leaders of factions of the Verkhovna Rada with the requirement to put to Parliament for consideration questions of immediate reduction of tariffs, suspension of forfeiture of property for the public debt, and at the same time and on the transfer of Ukrainian gas Ukrainian citizens.

The next day in the center of Kiev held a mass protest against the tariff increase, which, according to Ukrainian sources, was attended by six thousand people. A few days later the Deputy Chairman of “Batkivshchyna” Serhiy Sobolev, in connection with the next increase of tariffs for thermal energy stated that if the court overturned the decision of the National Commission of regulation of power industry of Ukraine, “millions of people will come to protest and we will go out to the people.” At the same Sobolev separately emphasized that 80% of the power system of Ukraine belongs to the structures of Rinat Akhmetov. This, the Deputy concluded that the increase in rates “will continue to work on the destabilization of Donetsk, Lugansk, Zaporozhye and other regions.”

Assessing the unpleasant prospects “tariff Maidan”, Ukraine’s leadership has made a number of statements aimed at calming the masses. In particular, Prime Minister Vladimir Groisman along with the rally in Kiev said that it intends to initiate investigations against companies that have exposed the citizens of inflated invoices. “It’s very strange this error. When some try to undermine the situation, appear bills doubled, tripled amounts”, – experienced Groysman at the meeting of the Cabinet of Ministers. At the same time Pro-government media reported that the backbone of the participants of the rally Antiterror made up the infamous “titushky” who paid for 70 UAH (about 170 rubles).

A few days ago, conspiracy theories have continued in the context of the recalculation of the inflated amounts. “I saw in a stairwell a few slips for its residents. And at all one and the same story: counting downwards for heating in November by 40-50%. That is, in early November, just before the scheduled “Maidan-3.5″, people have received very large bills? Do I understand correctly?” asked the President of Ukraine Yuri Biryukov on his page in Facebook. Now, according to Biryukov, in place of the topic “tariff genocide” came another external factor of destabilization – revelatory recordings of conversations of the Deputy of the Verkhovna Rada Oleksandr Onishchenko with President Petro Poroshenko. Statement about these records Onishchenko, hiding from the Ukrainian justice in London, made the TV channel “Russia 1”, then the security service and the Prosecutor General of Ukraine has charged him with treason.

At this critical moment in support of the tariff policy of the Ukrainian authorities was reiterated by their supervisors. During a public forum devoted to the International day against corruption, the US Ambassador to Ukraine, Marie Yovanovitch stated that the tariff increase is “one of the strongest anti-corruption steps taken by the Ukrainian government.” Taking into account the report of the European auditors it sounded quite ironic.

Anyway, the Ukrainian authorities continue to put a good face on a very bad game. Not long ago, Deputy Prime Minister Pavlo Rozenko, considering the number of applicants for subsidies on utilities 8.5 million families have noticed that next year it will gradually decrease due to the increase in household incomes. But if you follow the version that the funds for subsidies, the government of Ukraine will try to find in the pocket of the taxpayer, any income growth can not count. According to Kucherenko, the prospects for raising taxes are two scenarios: a “Smart Poland is waiting with open arms, and cunning to negotiate with the employers understate wages, thereby reducing revenues to the budget.”


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