In Ukraine again, will reconsider system of calculation of subsidies and impose their monetization
In Ukraine will change the system of subsidies. In addition to the parameters of their calculation, are also planning to introduce monetization, that is targeted disbursement.
Such commitments Ukraine has given its main creditor – the International monetary Fund – in an updated Memorandum of cooperation.
“We will continue our efforts to improve the targeting of social assistance, will strengthen the incentives of households to be Thrifty and will continue to implement spending within budget limits. To this end, we have reduced consumption from 5.5 to 5.0 cu. m per 1 sq. m for individual heating, and from 65 to 51 kW/h per 1 sq. m of electricity, which is used for individual heating, and 0,0548 to 0,0431 Gkal on 1 sq. m for district heating starting from may 1, 2017”, – stated in the obligations of Ukraine.
Until the end of July this year, will revise the “other system settings utility subsidies to households to improve targeting; introduce the adjustments of social norms in the peak month during the heating season; and the applicable distribution tariff gas and heating based on the capacity that will allow to transfer a fraction of the cost during the summer months – all changes will take effect from 1 may 2017, So this will allow you to restrict expenditure on subsidies to pay for public services 47 billion in 2017”.
In addition, every six months, under certain conditions, will adjust tariffs for gas and heating.
“To keep the tariffs at the level of a full refund, we have revised the Regulation on imposing special obligations on the subjects of natural gas market to ensure public interests in the process of natural gas market functioning to introduce a temporary mechanism for the automatic adjustment of retail tariffs for gas and heating on a semiannual basis if the rates deviate by 10% or more from the level of full coverage of cost (on a parity basis with the prices of imports, as defined in the Technical Memorandum of understanding),” – promised the IMF in Kyiv.
A temporary adjustment mechanism will operate as long as the tariffs are fully liberalized.
“We also every six months will adjust the price of gas of domestic extraction, with effect from 1 April 2017, so the price has remained the parity price of imported gas,” – the document says.
By the end of August this year, the Cabinet approved a decree on the introduction of monetization of aid “within the framework of subsidies for payment for housing and communal services at the level of the companies providing utilities to the end of September 2017. Therefore, private gas traders will be able to compete with the “gas” in gas supplies. We will also work towards the monetization of the utilities subsidies at the household level to improve the efficiency of energy use. Also, until the end of September 2017, we will make additional changes in the Resolution of the Cabinet of Ministers No. 758, which separate tariffs for the supply and distribution of gas from gas prices as a commodity. We also cancel (1 may 2017) scheme, in which households who do not receive subsidies, could pay for heating for 12 months (“installment”)”.