How can local governments struggle with “envelope” salaries and why do they need it? – clarification of experts

Hromadas are constantly looking for sources to increase their revenues to provide high-quality and accessible services while developing. Issues of filling local budgets should of concern not only to the executive bodies of the local council and deputies, but also to the residents themselves. Everyone living in hromada uses the services provided by the budget institutions and establishments, and therefore has to understand that he/she cannot stand aside the issues of their financing. In addition, the local budget funds the implementation of social and economic development projects of the territory important for each residents.

But so far this is not the case. The problem of the country and every hromada is shadow employment and envelope salaries. In Ukraine, 3.7 million people work without labour relations registration. In 2017, 1 million people received the salary that was less than the minimum, i.e. almost 10% of the total number of employees (10,1 million people). As a result, local and state budgets lose billions of hryvnias, thus reducing opportunities for hromada development and improvement of the quality of services provided to the residents.

The experts of the Financial Monitoring Group of the Central Reform Office under MinRegion (with the support of the U-LEAD with Europe Programme and SKL International) drew attention to the norms adopted in 2017 that transferred powers in the sphere of labour legislation observance to local self-government.

The full version is available in Ukrainian – please click HERE

26.03.2018 - 10:05 | Views: 39891
How can local governments struggle with “envelope” salaries and why do they need it? – clarification of experts

Tags:

budget budget methodology Yanina Kazyuk Viktor Ventsel Ihor Herasymchuk

Source:

Read more:

23 January 2026

Employment services closer to community residents: Expanding the functions of Administrative Service Centres

Employment services closer to community...

The Cabinet of Ministers of Ukraine has adopted a resolution that directly strengthens the capacity of communities in...

23 January 2026

Стартував відбір на Резиденцію ідей «Культурна спільнодія»

Стартував відбір на Резиденцію ідей «Культурна...

Пізнайте, як культура працює з досвідом війни, пам’яттю та відновленням спільнот – як формується взаємодія між...

22 January 2026

Громади отримають черговий пакет фінансування на 119 проєктів відновлення за підтримки ЄІБ

Громади отримають черговий пакет фінансування...

Громади отримають 740,3 млн грн, для реалізації 119 проєктів відновлення у громадах, за підтримки Європейського...

22 January 2026

Стартував відбір громад до другої черги проєкту «Рух без бар’єрів»

Стартував відбір громад до другої черги проєкту...

Міністерство розвитку громад та територій України розпочинає прийом пропозицій від громад для участі другій черзі...