Financial support of territorial communities of Ukraine in the context of decentralization

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Pavlina Fuhelo
Olena Zharikova
Kateryna Blishchuk
Tetiana Baranovska
Nataliia Gudzenko
صندلی اداری


The experience of the countries of the European Union shows that the driving force behind their social and economic development is local self-government, in Ukraine it is territorial communities. Decentralization reform should ensure that local governments are able to independently resolve all local issues with their own resources. The problem of financial provision of territorial communities is of particular relevance in the context of financial instability in the country. The methodological basis of the study was: a systematic approach - for the theoretical definition of the essence of the financial support of territorial communities and their assessment; methods of comparative analysis and synthesis - to identify patterns of financial support and the structure of budgetary resources of territorial communities; statistical methods for assessing the effectiveness of financial support for territorial communities; graphic - to display the main trends in the formation of monetary resources of territorial communities. To analyze the dynamics of financial provision of TC in Ukraine, statistical data for the last 5 years were used. The article considers the impact of decentralization on the financial support of territorial communities. Its advantages and disadvantages are determined. The filling of local budgets in Ukraine in the conditions of decentralization is analyzed. It was studied that own revenues of local budgets have been constantly growing during 2016-2020, which positively characterizes the introduction of decentralization. Although, compared to 2019, the total revenues of local budgets reduced due to a decrease in transfers from the state budget. The dynamics and structure of interbudgetary transfers in 2016-2020 are analyzed. The mechanism of equalization and receipt of basic subsidies is considered. The main sources of formation of incomes of local budgets are determined. The importance in the structure of incomes of territorial communities of the tax on the income of individuals is noted. An evaluation model of the sufficiency of financial support for territorial communities is considered and a ranked series of territorial units is constructed. The problems of the financial support system for territorial communities due to the existence of post-conflict and temporarily occupied territories are identified. Directions for improving the financial provision of territorial communities are proposed and alternative sources of funds for the budgets of territorial communities are considered.


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Integration System of Education, Science and Production
Author Biographies

Pavlina Fuhelo, Podillia State University

Ph.D. (Economics), Associate Professor has been working at the Department of Finance, Banking and Electronic Payment Systems. She teaches disciplines taught ″Financial controlling″, ″State financial control″, ″Budget management″. Scientific interests: state regulation of financial and economic activity; audit in the system of public financial control.

Olena Zharikova, National University of Life and Environmental Sciences of Ukraine

Ph.D., Associate Professor of Banking and Insurance (Finance), Associate Professor of Banking and Insurance has been working at the Department of Economics. She teaches disciplines taught students to have bachelor's and master's degrees. Has practical experience as the leading specialist in economic and financial issues at the enterprise "Velykosnitynka” Educational Research Farm named after O.V. Muzychenko. Scientific interests: Finance, Banking and Insurance, Economics. Web of Science ResearcherID: AAW-6543-2021

Kateryna Blishchuk , Lviv Polytechnic National University

Ph.D. in Economics. Associate Professor, Department of Regional and Local Development. Her continuous experience exceeds twenty years. Since 2022 her has been working at Lviv Polytechnic National University. In addition to research work, she teaches. Among the courses she teaches: sustainable development, public finance, local development, etc. Research interests: analysis, economy, finances.

Tetiana Baranovska, Zhytomyr Polytechnic State University

Ph.D. in Economics, Associate Professor of the Department of Economic Security, Public Management and Administration, candidate of economic sciences, Associate Professor. Lecturer of the following subjects: Strategic management, project management, management of financial and economic security, financial analysis, analytical support for management decisions. Scientific interests: analytical support for making managerial decisions; theory and practice of economic activity analysis; state financial control over planning and financing of the security and defense sector. Researcher ID :  M-7351-2018 

Nataliia Gudzenko, Vinnytsia National Agrarian University

Ph.D. in Economics, Associate Professor, Department of Accounting and Taxation are in Industries of Economy. 


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