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Reforms in Ukraine: good ideas, bad execution?

 

by Roman Zagorodniy

 

Back in 2014, the newly appointed Government of Ukraine received a credit of trust to make painful albeit vital reforms. Inspired by the Revolution of Dignity and consolidated by external aggression, Ukrainians realized that groundbreaking changes are the only way to combat corruption and build up a wealthy European state. That is why the majority voted for parties which offered a roadmap to successful rebooting of economy with consequent socio-economic recovery in the foreseeable future. Today, at the onset of the local elections scheduled on October 2015 the recently published polls show that since the last autumn the Government has not been able to meet most of the people’s expectations. Let us attempt to analyze what could have gone wrong.

In their parliament election programs, the winner Petro Poroshenko’s Block and runner-up PM Yatseniuk’s People Front carried a strong pro-European reformistic message. The three other members of future Coalition: Samopomich, Batkivshchyna, and Radical Party presented the remedies to economic downturn and social recovery of Ukraine similar to each other. The parties’ programs were filled with proposals for sometimes constructive and coherent; sometimes blurring and very general; and sometimes fairly unrealistic or even populistic reforms.

According to the analysis provided by Unian (2015), apart from strong military and National Defense messages, the five Coalition Parties highlighted the following reforms in their programs:

  • state administration and public service reform;
  • deregulation and “e-governization”;
  • the decentralization by providing fiscal autonomy and delegating regulatory   authority to new local governments called ‘hromads’;
  • adjustment to European standards;
  • Judicial and Interior Ministry reform.

 

The implementation of all these reforms requires strength and determination from the Government as well as support, trust and patience from the society. The results of public opinion surveys together with the analysis of recent Government’s activity show that neither Government demonstrates a sufficient level of determination nor the society has enough patience and trust. This unfortunate coincidence leads to serious loss in popular support for the parties in power in general and Prime Minister and President in particular, which in turn may make the successful implementation of reforms questionable.

Table 1. The results of pre-local election polls

 

(% of those who are going to take part in elections)

Source

Centre for Social Research “Sofia”

Ilko Kucheriv’s “Democratic Initiatives” Fund & Razumkov Centre

A. Yaremenko Institute of Sociological Research &Social Monitoring

KIIS (Kyiv International Insitute of Sociology)

 

24 July – 9 August

22–27 July 2015

4–14 July

27 June – 9 July

N

10 147

2011

3924

2044

 

 

 

 

 

Estimated turnout

77%

68%

72%

82%

 

 

 

 

 

Solidarity Bloc

18%

14%

26%*

16%*

VO “Fatherland”

12%

7%

12%

17%

Oposition Bloc

11%

8%

11%

5%

Samopomich

9%

9%

11%

8%

Radical Party

9%

7%

9%

5%

VO “Freedom”

4%

3%

7%

2%

Right Sector

-

4%

5%

3%

“Civil Position” Party

4%

3%

4%

3%

People’s Front

4%

2%

3%

2%

Communist Party

-

2%

3%

1%

particular candidate

-

16%

-

-

others

13%

3%

4%

2%

 

 

 

 

 

Uncertain yet

19%

23%

13%

33%

 

 

 

 

 

Sample error**

~1%

~2.3%

~1.6 %

~2.4%

Note: all surveys were conducted by face-to-face interviewing. All samples exclude Crimea and the occupied territories of Luhansk and Donetsk regions. The Coalition members are highlighted (Radical Party quited the Coalition in August)

* These are merged results of 'Udar' Party and Petro Poroshenko Bloc.

**Sample error means the maximum length of confidence interval (with 95% confidence level)

 

Recently, Mr. Yatseniuk’s People’s Front suffered the most severe fall in support, despite the fact that it has the most coherent and more or less realistic program of economic development based on the EU Association Agreement and external macro financial stabilization. This year’s July polls also show that if the election was held on the day of survey, People’s Front would be unlikely to score even 5% threshold. This is a drastic decrease comparing to the result of Parliamentary elections. What is more, according to other surveys, published by IRI (2015, p.41) 84% of respondents do not approve the actions of Cabinets of Ministers – a body responsible for implementation and execution of reforms.

We should not forget that drop in support after the election is a well-known phenomenon tested in domestic politics in many democratic countries (see e.g. Koepke 2006), Ukraine is not an exception: the support for governing parties goes down after the election. This trend is visible in Figure 1. The matter is, however, how long the party or politician is able to maintain the election-day level support and how deep the inevitably coming decrease in support is. In today’s Ukraine, its current level is the lowest in the country’s modern history, “outperforming” even Tymoshenko’s Cabinet ratings [?] during Russia-Ukraine “gas-wars” in 2009 (see figure 1). And these are the outcomes of one year in office only.

 

Figure 1. The dynamics of support of Prime Ministers of Ukraine (2000-2015).

Source: Author’s elaborations based on Razumkov’s Centre surveys

 

Neither does the President’s approval poll look better. In mid-summer 2015, about 67% of respondents were dissatisfied with his performance (IRI, p. 40-41). Comparing to overwhelming 54% one-tour victory and Party’s moderate success in the Parliamentary elections, this result looks horrible. The President was the one who presented the so-called Strategy for Sustainable Development "Ukraine – 2020" where he outlined 62 reforms that need to be made as well as key indicators Ukraine should reach as a result of them. For instance, the President set an ambitious goal to climb up to the top 40 position (currently: 96) in Global Competitiveness Index and top 30 (currently: 79) in Ease of Doing Business ratings. Mr. Poroshenko also believes that today’s Purchasing Power Parity (PPP) can be doubled to $16’000 per capita in the next four and a half years.

Since his arrival to Bank Street office in Kyiv, Mr. Poroshenko managed to have six out of height priority reforms such as anti-corruption and deregulation being worked on in state bodies. On the legislator side, the President used his legislation initiative right by making laws such as “de-centralization” one. The healthcare and tax reform remained underdogs in terms of the implementation and there was no clear policy towards “Global Promotion of Ukraine” state program except from creating a controversial Ministry of Information. This raised many concerns why President, being a supervisor (according to ‘2020’ Strategy) and initiator of reforms, does not make sure they take place.

Figure 2. The dynamics of support of Presidents of Ukraine (2000-2015).

Source: Author’s elaborations based on Razumkov’s Centre surveys

 

Was everything so bad?

At the beginning, not really. Given the resources, budget capacities and potential obstacles, I reckon the e-government reform is the most promising and efficient tool to fight corruption, optimize budget, and make state deregulation transparent at the same time. It was agreed that the Government should create an e-infrastructure for online activities during summer-autumn 2015. In particular, in I and II quarters the Government concentrated on using modern information technologies in the public sector which would provide digital services platforms for citizens and businesses by the end of the year (ProZorro, 2015).

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