Financial Mechanisms of State Support for the Socio-Economic Development of United Territorial Communities in the Context of Decentralization
Dub A. R.

Dub, Andrii R. (2019) “Financial Mechanisms of State Support for the Socio-Economic Development of United Territorial Communities in the Context of Decentralization.” The Problems of Economy 1:52–58.
https://doi.org/10.32983/2222-0712-2019-1-52-58

Section: Regional economy

UDC 336.1:332.1

Abstract:
Public funds are a significant source of external financing for united territorial communities (UTCs). However, numerous risks are inherent in the mechanisms of state support for the socio-economic development of territorial communities. The aim of the article is to identify ways to improve financial mechanisms of state support for the socio-economic development of united territorial communities based on an analysis of their functioning at the first stage of decentralization. There described the main mechanisms of state financial support for the socio-economic development of united territorial communities at the first stage of decentralization (2015–2017): subvention for implementing measures for the socio-economic development of individual territories, subvention for building the infrastructure of united territorial communities and resources of the State Fund for Regional Development. The volumes of the amounts allocated to and used in united territorial communities of the Carpathian region are analyzed. The need for providing state financial support for the created UTOs at the initial stage of their activity is proved. There revealed deficiencies in the functioning of mechanisms of state financial support for the socio-economic development of UTOs: dominance of social projects over economic ones; imperfection of the formula for the distribution of subvention for forming the infrastructure of united territorial communities; the non-transparent mechanism for distribution of subvention for implementing measures aimed at the socio-economic development of individual territories; low level of co-financing of projects from local budgets, etc. The article justifies the need for increasing the number of economic projects in UTCs; attracting funds of private investors to projects financed from the state budget; toughening the requirements for design documentation submitted to the State Fund for Regional Development. The attention is focused on the expediency of a gradual transition from the provision of united territorial communities with ready financial resources from the state budget to the creation of conditions for stimulating the communities to increase their investment attractiveness.

Keywords: united territorial community, subvention, budget, State Fund for Regional Development.

Fig.: 3. Bibl.: 10.

Dub Andrii R. – Candidate of Sciences (Economics), Associate Professor, Senior Research Fellow, Department of Regional Financial Policy, Institute of Regional Research named after V. I. Dolishniy of the NAS of Ukraine (4 Kozelnytska Str., Lvіv, 79026, Ukraine)
Email: oak_an@ukr.net

List of references in article

Bobrovska, O. Yu., and Munko, A. Yu. “Finansovo-ekonomichne zabezpechennia terytorii v umovakh detsentralizatsii“ [Financial and economic provision of territories in conditions of decentralization]. Aspekty publichnoho upravlinnia. 2015. http://nbuv.gov.ua/UJRN/aplup_2015_4_13
Bondaruk, T. H. “Dokhody mistsevykh biudzhetiv v umovakh detsentralizatsii“ [Local budget revenues in decentralized conditions]. Naukovyi visnyk NASOA, no. 1 (2015): 51-56.
Lehkostup, I., and Suliak, A. “Detsentralizatsiia ta yii finansovi aspekty v suchasnykh sotsialno-ekonomichnykh umovakh Ukrainy“ [Decentralization and its financial aspects in modern socio-economic conditions of Ukraine]. Visnyk Odeskoho natsionalnoho universytetu. Seriia : Ekonomika. 2016. http://nbuv.gov.ua/UJRN/Vonu_econ_2016_21_2_34
Taranhul, L. L., and Koliada, T. A. “Osoblyvosti formuvannia mizhbiudzhetnykh finansovykh potokiv v umovakh zaprovadzhennia v Ukraini biudzhetnoi detsentralizatsii“ [Features of the formation of intergovernmental fiscal flows in the context of budget decentralization in Ukraine]. Finansy Ukrainy. 2015. http://nbuv.gov.ua/UJRN/Fu_2015_3_5
Chubar, O. H., and Mashiko, K. S. “Detsentralizatsiia i finansove zabezpechennia terytorialnoi hromady“ [Decentralization and financial support of the territorial community]. Naukovyi visnyk Uzhhorodskoho universytetu. Seriia : Ekonomika, no. 1 (1) (2016): 419-426.
“Top-5 vydatkiv Derzhavnoho biudzhetu na rozvytok rehioniv 2019 roku“ [Top 5 expenditures of the State Budget for the development of regions in 2019]. http://cost.ua/news/663-top-5-expenditures-2019
[Legal Act of Ukraine] (2015). http://zakon.rada.gov.ua/laws/show/928-19
[Legal Act of Ukraine] (2016). http://zakon.rada.gov.ua/laws/show/1801-19
Stadnyk, M. “Analiz rozpodilu subventsii na formuvannia infrastruktury obiednanykh terytorialnykh hromad u 2016-2017 rokakh“ [Analysis of the subvention distribution for the formation of the infrastructure of the united territorial communities in 2016-2017]. https://feao.org.ua/wp-content/uploads/2015/11/2017-12-21-subvenciyi-infrastruktury-2016-2017.pdf
Donchenko, K. “Yak derzhava finansovo pidtrymuie detsentralizatsiiu“ [How the state finances decentralization]. https://mbiz.censor.net.ua/resonance/3083525/yak_derjava_fnansovo_pdtrimu_detsentralzatsyu