Economic growth is impossible without a powerful local self-government.

 Local elections scheduled for October 25 may become a milestone in the transition from the old administrative-authoritarian to a new local self-government system. Association of territorial communities is key for economic growth, provision of high-quality social and administrative services, and creation of jobs owing to the pooling of financial resources. The Reanimation Package of Reforms calls for adopting the draft law No. 0915 “On Voluntary Associations of Territorial Communities” which should lay the foundation for the next stage of the local self-government reform. The Verkhovna Rada of Ukraine might launch the process of decentralization next week already, at the plenary meetings on February 3 and February 5.

“We might get even more centralized country with all political decisions being made in Kyiv, unless we put things right in the administrative and territorial structure and implement the fiscal reform”, says Oleksandr Solontai, expert of the Institute of Political Education.

 The bill introduces a simple mechanism of association of small villages and towns, as well as direct government assistance to the united territorial communities. It will let small towns, villages, and townships get more taxes, as the cities of regional significance currently do. “Most territorial communities lack material, infrastructural, and financial resources to deal with the basic issues and provide social services. To change this situation and give the communities a chance to earn more, the Local Self-Government Committee of the Verkhovna Rada of Ukraine has reviewed and supported the draft law on voluntary associations of territorial communities”, says Serhii Kudlayenko, MP of Petro Poroshenko Bloc.

While the draft law was being prepared for the second reading, a key article, i.e. Art. 12 “On Developing Long-Term Plans to Create Capable Communities”, has been removed. The Reanimation Package of Reforms calls on the Verkhovna Rada of Ukraine to vote for the draft law in the second reading and restore Article 12 that was included in the document in the version submitted for the first reading. Yurii Hanushchak, expert of the Reanimation Package of Reforms, stresses, “It is on the basis of a long-term plan only that the government can provide material, technical, and financial support to the communities. Unless such a plan is developed, territorial communities will not get any benefits.”