Summary and recommendations of using funds from the COVID-19 Response Fund.

Ukraine holds the 25^th place in the world by the number of people infected by the acute respiratory COVID-19 illness and 112^th place by the number of tests per 1 million of population. The government of Ukraine has taken a number of measures aimed to prevent the rise and spread of COVID-19 as well as solution of problems related to the economic, financial and social situations which emerged under the influence of COVID-19. A special Fund to combat a respiratory disease COVID-19 caused by coronavirus SARS-CoV-19 and its effects (hereinafter referred to as the Fund) in the amount of UAH 66 billion was established in April of 2020.

As of September 15, 2020, UAH 65.4 billion, which constitutes 99% of its scope, have been allocated. The mechanism of allocation of funds from the COVID-19 Response Fund elaborated and introduced by the government of Ukraine is bureaucratized, non-transparent and ineffective because the procedure of allocation, being time-consuming, presupposes approval of each draft decision to allocate money by all bodies concerned as well as the Budget Committee of the Verkhovna Rada of Ukraine. The procedure to use money does not include criteria by which the Cabinet of Ministers of Ukraine grants requests of public bodies.

In fact, since the moment the procedure for using funds from the Fund was approved four months ago, the monthly need of healthcare institutions of the first wave hospitalizing COVID-19 patients in individual protection gear has not yet been met by 100%. Despite significant savings in procurements of individual protection gear of medical workers at healthcare institutions hospitalizing COVID-19 patients, the Ministry of Healthcare of Ukraine does not use the saved money to buy additional individual protection gear.

Considering predictions of WHO in regard to duration of the pandemic, we recommend that the Cabinet of Ministers of Ukraine reject the practice of creation of the special Fund and manual allocation of funds in the Fund, as such approach prevents the government from timely and effective responding to challenges the state is facing in the process of fighting against the acute respiratory illness of COVID-19 caused by SARS-CoV-2 coronavirus. Instead, it would be appropriate:

1. To raise expenditures on healthcare and social protection of the population and assistance to businesses.
2. To develop new budget programs or review the existing programs of the Ministry of Healthcare of Ukraine, Ministry of Social Policy of Ukraine, and Ministry for Economic Development, Trade and Agriculture of Ukraine, having set their aims and performance indicators which will enable the government to see whether the set aims have been achieved.
3. To increase the state budget reserve fund and introduce changes to the Budget Code for the period of the quarantine specifying the procedure for using the reserve fund.

This policy Brief has been drafted with support of the International Renaissance Fund within the project Civil Control over Budget Expenditures from the State Fund for fight against Covid-19 in Ukraine. This material reflects the position of its authors and does not necessarily coincide with the position of the International Renaissance Fund.