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Support for Economic Growth and Fiscal Reform

Europe and Eurasia USAID 2001 2004

DevTech provided resident, long-term technical assistance on budget reform and institutional strengthening in Ukraine.

The project had two phases.

Phase I

During the first 18 months, DevTech assisted the Ministry of Finance to reform its budget process. DevTech provided a Budget Advisor, who helped the Ministry of Finance design and incorporate policies, procedures, and programs that ensured all government ministries develop and execute balanced budgets that reflected their respective short-, medium- and long-term strategies, priorities, and objectives. The Budget Advisor trained various line-ministries and conducted strategic planning while helping to build the capacity of the ministries’ staff with regards to program or performance based budgeting (PPB). DevTech also helped the Ministry of Finance to establish a more effective revenue and expenditures structure that was consistent with the new market economy driven government functions.

Phase II

In 2003, the project shifted focus from federal ministries to the sub-national level. DevTech began promoting fiscal decentralization and equitable allocation of resources, and trained local officials to increase their budgeting and financial management expertise and capabilities. The Senior Budget Advisor, based in Khmelnitsky, became Chief of Party. As such, he assisted local governments in Lviv and Poltava to improve their financial position through PPB, resulting in more autonomy and accountability. DevTech led a nationwide budget training to raion and subraion finance officers, focusing on the opportunities and requirements mandated in Ukraine’s new Budget Code. Three oblasts and their cooperating jurisdictions used PPB for their 2005–2007 budgets, thus demonstrating a capacity to implement improved budgeting approaches. They were then selected to participate in an intense training program with seminars, workshops, and mini-trainings, which served as a PPB Pilot Project to be replicated on a wider scale. DevTech also provided critical technical input into the extension of the Budget Code to lower levels of local government, specifically to subraion levels.