State Budget Implementation – 2024: Positive Achievements and Wartime Challenges
The state budget in 2024 was implemented in conditions of growth in real GDP, imports of goods, consumer prices, and devaluation of the hryvnia exchange rate against some foreign currencies. At the same time, according to the Accounting Chamber, the difference between individual actual macro indicators and forecasted ones led to a shortfall of UAH 65.5 billion in revenues to the state budget. Although the costs of debt repayment and servicing and some expenses, due to the difference between the forecast and real exchange rates, were lower than planned by UAH 22.4 billion at the end of the year.
This was reported by the Head of the Accounting Chamber Olga Pishchanska, presenting conclusions on the results of the analysis of the annual report on the implementation of the Law of Ukraine «On the State Budget of Ukraine for 2024» during the meeting of the Accounting Chamber on April 18.
According to her, significant international support during martial law contributed to the stability of public finances, the growth of Ukraine's international reserves to a record $43.8 billion. USA and the implementation of the most necessary state budget expenditures. In particular, in 2024, 1.7 trillion UAH was received from international partners– this is 10.2% more than last year, but 4.2% less than the plan.
«The decrease in international aid receipts that we are observing this year requires the Government to pay more attention and consistency in the use of budget funds», – emphasized Olga Pishchanska.
REVENUES
The state budget revenue plan in 2024 was exceeded by 373 billion UAH (13.5%). Compared to 2023, state budget revenues increased by UAH 451 billion (16.9%):
– due to economic factors – by UAH 316 billion;
– due to administrative factors – by 178 billion hryvnias.
Auditors recorded an increase in taxpayer debt to the state budget by 29%. Taxpayer debt continued to accumulate, in particular, under the conditions of the lifting of the moratorium on tax audits.
Revenues from privatization of state property exceeded the planned figures by 2.5 times.
«9.9 billion UAH The state received from privatization, largely due to the sale of two large privatization objects: SE «Hotel «Ukraine» and JSC «United Mining and Chemical Company». This is the first case of the sale of large enterprises since 2018. Regarding small privatization objects, we also noted an increase in revenues by 300 million UAH compared to 2023», – notes Olga Pishchanska.
EXPENDITURE
State budget expenditures amounted to UAH 4.5 trillion, which is 2.8% less than planned. At the same time, this is the highest figure since 2020.
Compared to 2023, expenditures on measures related to the security and defense capability of the state increased by UAH 340 billion (12.9%) to UAH 2.1 trillion, primarily for the purchase of special-purpose goods. At the same time, the Government ensured compliance with the requirements of international partners regarding the implementation of expenditures on national security and defense exclusively from domestic sources.
«In 2024, receivables under the budget programs of the Ministry of Defense increased to UAH 294 billion. The reasons for this trend, which we identify during audits, are – improper fulfillment of the terms of contracts, in particular regarding the terms of delivery of defense goods,– notes Olga Pishchanska.
As for the fund for liquidation of the consequences of armed aggression, in the reporting period the Government allocated UAH 23.3 billion from it (95% of its total resources). The funds were used mainly for measures to protect critical infrastructure facilities and restore settlements. At the same time, expenditures from this fund were made by UAH 6.3 billion (21.7%) less than planned, and the balance of the fund's funds at the end of 2024 amounted to UAH 7.6 billion.
STATE DEBT
The total amount of state and state-guaranteed debt increased by a quarter by the end of 2024 – to 6 trillion 981 billion UAH and amounted to 91% of GDP. At the same time, according to the Accounting Chamber, transactions with state and state-guaranteed debt carried out in August 2024 contributed to a debt reduction of 216 billion UAH. The state budget expenditures on the repayment and servicing of state and state-guaranteed debt were UAH 85 billion (9.2%) less than planned.
At the same time, the Head of the Accounting Chamber emphasized that in order to increase the stability and efficiency of management in this area, it is necessary to adopt the State Debt Management Strategy for 2026-2028.
Based on the results of the analysis of the state budget execution for 2024, the Accounting Chamber provided the Cabinet of Ministers with recommendations to eliminate the identified shortcomings. In particular:
– develop a plan for reforming tax legislation to implement a unified approach to providing tax benefits;
– instruct the Ministry of Finance, together with the State Tax Service, to develop a plan of measures to reduce the tax debt of business entities to the state budget;
– instruct the main administrators to take measures to reduce and prevent the growth of overdue receivables, etc.
It should be noted that almost half of the recommendations provided to the Cabinet of Ministers of Ukraine in 2024 based on the results of the analysis of the budget execution for various periods have been fully implemented. Thanks to this, in particular:
– The National Health Service of Ukraine quarterly monitors the implementation of the budget program for the implementation of the medical guarantees program, which contributed to the improvement of the program's implementation status;
– The Ministry of Finance resumed the publication of the report on the implementation of the public debt management program, which ensured the restoration of compliance with the principle of publicity and transparency;
– The Government submitted for consideration by the Verkhovna Rada of Ukraine a draft law that will ensure the restoration of the submission by respondents of statistical and financial reporting necessary for the production of high-quality state statistical information, etc. during the period of martial law.
