“Hundreds of billions for defense: government submitted amendments to Budget-2025 to Verkhovna RadaThe government registered a bill in the Rada on amendments to the State Budget-2025, which provides for an increase in
expenditures on security and defense by UAH 412.4 billion. Additional expenditures will be covered by increasing budget revenues
and domestic borrowings.
”, — write: unn.ua
The Cabinet of Ministers of Ukraine, as a subject of legislative initiative, has registered in the Verkhovna Rada of Ukraine the draft law “On Amendments to the Law of Ukraine “On the State Budget of Ukraine for 2025″ regarding the financial support of the security and defense sector and the resolution of priority issues” (registration No. 13439)
What is foreseenAccording to the explanatory note to the bill on the parliament’s website, it is proposed to increase state budget expenditures for national security and defense by UAH 412,374.9 million, including: general fund – UAH 401,605.0 million, special fund – UAH 10,769.9 million.
Additional expenditures for the general fund amount to UAH 401,605.0 million (for salaries with accruals – UAH 115,046.4 million, military, special equipment and machinery – UAH 215,851.3 million, other expenditures – UAH 70,707.3 million), including for:
- Ministry of Defense (together with the State Transport Special Service) – UAH 310,843.3 million, of which salaries with accruals – UAH 48,397.2 million, provision of military (special) equipment and machinery – UAH 193,948.2 million;
- MIA system (National Police, State Border Guard Service, National Guard) – UAH 84,088.0 million, of which salaries with accruals – UAH 60,984.6 million, provision of military (special) equipment and machinery – UAH 20,903.1 million;
- Security Service – UAH 1,564.5 million, of which salaries with accruals – UAH 1,064.5 million, provision of military (special) equipment and machinery – UAH 500.0 million;
- Main Intelligence Directorate of the Ministry of Defense – UAH 4,539.7 million, of which salaries with accruals – UAH 4,039.7 million, provision of military (special) equipment and machinery – UAH 500.0 million;
- State Special Communications Service Administration – UAH 64.5 million, of which salaries with accruals – UAH 55.4 million;
- State Protection Department – UAH 505.0 million for salaries with accruals.
As reported, it is proposed to adjust the expenditure part of the state budget by UAH 397,492.2 million.
“The bill is balanced,” the explanatory note says.
The implementation of the act, as indicated, “will lead to an increase in the maximum deficit of the state budget by 3.0% and the maximum amount of public debt by UAH 184,884.9 million.”
At the same time, the bill, as noted, provides for the possibility of exceeding the maximum amount of public debt by the amount of attracted loans (borrowings) in accordance with agreements with the EU, foreign states, foreign financial institutions and international financial organizations, the repayment of which will be carried out at the expense of sources other than the State Budget, including at the expense of income received from frozen assets of the Russian Federation. Such a norm, as noted, “makes it possible to fully attract these loans (borrowings) in 2025, while not creating an additional burden on the state budget.”
How additional expenditures are planned to be coveredTo cover these expenditures, according to the explanatory note, it is specifically proposed:
- increase state budget revenues by UAH 147,492.2 million, including general fund revenues by UAH 137,488.7 million and special fund by UAH 10,003.5 million;
- increase the financing of the general fund of the state budget through debt operations by UAH 250,000.0 million by increasing the volume of state domestic borrowings by UAH 184,884.9 million with a simultaneous decrease in the volume of payments for repayment of domestic public debt by UAH 65,115.1 million;
- reduce expenditures of the general fund of the state budget, according to the proposals of the main dispenses of state budget funds.
Debt restructuringIt is also noted that the bill proposes to amend the Law of Ukraine “On the Peculiarities of Transactions with State, State-Guaranteed and Local Debt and State Derivatives.”
Ukraine, as indicated, in accordance with the Memorandum of Economic and Financial Policy signed with the IMF, has undertaken to achieve debt sustainability indicators, including restructuring with official and commercial creditors.
“In July 2024, the debt under the loan attracted under the state guarantee in accordance with the loan agreement between JSC “GPZKU” and Eximbank of China (creditor) for financing projects in the agricultural sector was classified by the Chinese side as official bilateral debt,” the message states.
As noted, in pursuance of the decision of 22.10.2024, the government began negotiations with the creditor on debt restructuring. On 20.12.2024, the creditor by e-mail “expressed consent to negotiate the restructuring of payments under the loan agreement and informed that the restructuring process could be a long one.”
“Given the ongoing negotiations with the Chinese side regarding the possibility of debt restructuring on terms of equality with other official creditors of Ukraine, the need to achieve the targets set by the IMF program, and in order to prevent fiscal risks, it is necessary to amend the Law of Ukraine “On the Peculiarities of Transactions with State, State-Guaranteed and Local Debt” regarding the possibility of introducing a moratorium on satisfying creditor claims in case of a guarantee event under the above-mentioned loan agreement until the completion of negotiations with the creditor and the conclusion of a transaction on the debt obligations of JSC “GPZKU” under the loan attracted under the state guarantee,” the explanatory note states.
Temporary suspension of payments, as indicated, is planned to be introduced for the state’s guarantee obligation regarding the relevant debt obligations of JSC “GPZKU” for the period until such transaction (transactions) is concluded and the terms of the relevant borrowing are changed.
Budget-2025: the Rada explained where the additional UAH 412 billion will specifically go30.06.25, 11:14 • 1502 views