Decisions by Rada: draft budget 2021 adopted, Shkarlet appointed, Vitrenko not appointed, fines for serving customers without masks increased

During its last plenary week, the Verkhovna Rada is trying to address all urgent issues it had not found time to deal with earlier. Today in our digest: draft government budget, appointments in the Cabinet, and stricter mask control.

Draft budget 2021 adopted

Status: adopted by the Parliament, awaits to be signed by the President.

Who is affected: Ukrainian citizens, businesses, government bodies, and local governments.

What does it change: the following indicators have been approved:

  • budget revenue — slightly less than ₴1.1 trillion
  • expected expenditures — over ₴1.3 trillion
  • next year Ukraine will loan at least ₴246 bln
  • minimum wages will be increased to ₴6,000 from January 1, 2021, and to ₴6,500 by December 1, 2021.

What is wrong:

  • significant budget deficit presents a threat to the economic stability of the state and will be a major factor in speeding up inflation
  • despite the successful trials of COVID-19 vaccines, it is impossible to tell when the economy will fully recover. Thus, national debt can grow even more than planned due to economic decline and resulting shortage of the budget revenue
  • increase in minimum wages will increase fiscal pressure on business, especially micro businesses that have suffered the most from the pandemic. Therefore, the increase in minimum wages will likely cause more unemployment and push some micro businesses into the shadow economy.

Shkarlet appointed the Minister of Education

Voted for the resolution: Servant of the People — 171, Opposition Platform — For Life — 20, Trust — 16, For the Future — 12, independents — 7.

Who is affected: the Cabinet, the Ministry of Education, educational establishments, schoolchildren, students, teachers, lecturers, and local governments.

What does it change: acting minister Serhii Shkarlet has been appointed the Minister of Education and Science.

What is wrong: appointing Shkarlet, the Parliament has ignored the fact that the dedicated committee had several times refused to support his nomination and that many educators, scientists, and NGOs protested against his appointment.

What else: Shkarlet owns his appointment to votes from Opposition Platform — For Life, Trust, For the Future, and independent MPs. This proves that the parliamentary majority is not that strong and in future draft bills prepared by the Ministry of Education could be turned down.

Vitrenko not appointed the First Deputy Prime Minister of Energy

Who is affected: the Cabinet, the Ministry of Energy, and energy industry enterprises.

What does it change: the Cabinet still lacks the First Deputy Prime Minister and the Minister of Energy. For a long time, the ministry is led by acting heads.

What is wrong: the ministry will be led by the Acting Minister Yurii Boiko at least until mid-January. The absence of the permanent head impedes the ministry’s efficiency, its ability to develop and implement a consistent and long-term energy policy.

What next: the Prime Minister has to propose a new candidate for the Minister of Energy to the Verkhovna Rada.

What else: Servant of the People has failed to give enough votes for its own candidate, so the party does not have an effective majority. There is a risk that either Rada will become incapable of passing legislation or Servant of the People will push draft bills with the help of other factions (such help is often not free).

Fines for serving customers without masks increased

Status: the bill has been passed.

Who is affected: the National Police, companies, sole proprietors, and Ukrainian citizens.

What does it change: companies and sole proprietors are obliged to warn their customers that they have to wear masks indoors, and if customers refuse to comply, the police should be called. For ignoring the law, a business can get a fine from 200 to 300 tax-free minimums.

What is right: the law stimulates businesses to ensure that their customers observe the lockdown restrictions.