Recommendations of All-Ukrainian Conference
"Local Government in the Context of Constitutional and Democratic Reforms in Ukraine"
All-Ukrainian conference on the subject of "Local government in the context of constitutional and democratic reforms in Ukraine" was held on the 14th of April , 2005 in Kiev.
The Conference was organized jointly by Ukrainian Association of Local and Regional Authorities and Municipal Sustainable Development Programme of UNDP, Ukraine. Support to the Conference was also granted from Congress of Local and Regional Authorities of Ukraine, Cabinet of Ministers of Ukraine, Advisory Council on Local Self-Governance at the Speaker of Verkhovna Rada of Ukraine, Local Self-Government Support Fund of Ukraine, Public Council on Local Governance Legislation as well as by different civil society organizations.
Compliment to the participants of the conference were passed from the representatives from Cabinet of Ministers of Ukraine, Verkhovna Rada, Administration of the President of Ukraine, central and local executive bodies, local authorities and their voluntary associations, representatives of public, scientific and educational organizations and agencies, youth organizations, international agencies and mass media took part in the Conference. Total number of participants was more then 140 persons, representing all regions and all strata of Ukrainian society.
The goal of the Conference was to prepare the practical recommendations for the Government of Ukraine concerning formation of new democratic ideology in Ukraine, strategy of sustainable municipal development in Ukraine as well as the legislative support of structural reforms of local governance in Ukraine.
Information and reports delivered to the Conference -
Presentation of the Blue Ribbon Commission Report and Proposals to the President: A New Wave of Reforms prepared by UNDP/Ukraine took place at the Conference. The goal of this Report is to assist the Government and people of Ukraine with proposals how to achieve quick and sustainable social and economic growth and to raise the life standards for all population of Ukraine.
Having discussed current situation in the sphere of territorial organization of power, functioning of local authorities as well as factors that obstruct sustainable municipal development, participants of the Conference have came to the following conclusions:
1. The local Government is in the deep systematic recess in Ukraine. For a long time the targeted policy was realized aimed on degrading the role of the local democracy institutes and centralization and total control mechanisms were imposed at the state level. As a result the vast majority of the rural, town and many city communities could not receive high-quality services from their local authorities. Among the causes of this situation it should be mentioned the absence of appropriate territorial, material and financial and economic basis to ensure full-scale functioning of local government as well as realization of allocated powers.
Commitments of Ukraine concerning full-scale implementation of provisions of the European Charter on Local Self-Governance are still not fulfilled , in particular, on functioning a local government such as district and regional councils that became in many respects merely appendages to their local state administrations.
Commitments taken by Government of Ukraine concerning Millennium Development Goals and implementation of Local Agenda 21st should generate the appropriate strategy for the country’s local development. It is necessary to create the required prerequisites such as strengthening of democratic control at all levels of government, and the inclusion of sustainable development values into economic, social and environmental policy of Ukraine.
Negative tendencies are also related with the imperfection of the existing legislative base that generates numerous conflicts between different levels of government both in horizontal and vertical dimension and thus creating additional tension in relations between local executive bodies and local authorities.
2. The future of Ukraine lies in decentralization, developing of local and regional democracy, ensuring the supremacy of law, that have to be one of the main priorities of Ukraine.
Today Ukraine faces the choice the new values, in particular in the organization of efficient local governance system.
Declared by newly formed government (President of Ukraine, Cabinet of Ministers of Ukraine) the course on the transformation of Ukrainian society is focused on ordinary citizen and encourages carrying out comprehensive reform of a local government. To ensure reform efficacy and consistency it is necessary to form the new democratic municipal ideology in Ukraine in accordance with the main principles of European Charter on Local Self-Governance, and maximum approximated to and oriented on the universally recognized European standards.
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On the basis of discussed reports and the practical conclusions, including positive experience of National Forum of Partner Municipality of MSDP, participants of the Conference proposed to make a number of urgent steps toward creating the new democratic municipal ideology, developing the strategy of sustainable municipal governance with the participation of local communities and population, including legislative provision of structural reforms of local governance in Ukraine, in particular:
1. On strengthening the constitutionally legal base of local self-governance
It is well-known, that section ХІ "Local Self-Governance" of the Constitution of Ukraine includes series of contradictory provisions that limit the development of full-fledged legislative base for local governance. The absence of appropriate legislation, in turn, constrains the creation of efficient model of the local governance in Ukraine.
Necessity of strengthening constitutional base of local government is also connected with the impossibility to ignore the requirements of the Congress of Local and Regional Authorities of Europe that are reflected their Recommendations and Resolutions concerning inability of Ukraine to meet its commitments, taken during ratification of the European Charter on Local Self-Governance.
Taking this into consideration it makes sense to adopt as soon as possible the draft law № 3207-1 concerning modification of the Constitution of Ukraine in the part concerning the local government.
The provisions in the draft law would be important base for further carrying out reforms aimed at improving the administrative and territorial system of Ukraine and increase the efficiency of local authorities, representing common interests of communities as well as district and regional councils.
At the same time it should be noted, that the draft law № 3207-1 only partly covers a set of problematic questions that have to be regulated at the constitutional level in the future. It should not however serve as the basis for reviewing agreements achieved by the Parliament, concerning adoption of that draft law and of enforcing it within defined timeframe.
The consistency of policy aimed to strengthen constitutionally legal warranties for local government would open the possibility to adopt series of important laws, in particular:
- "On Territorial System of Ukraine ",
- "On Local Self-Governance in Ukraine" (new edition),
- "On Executive Authorities".
- “On Local Elections”
The adoption of mentioned laws should take place before the beginning of formation (election) of new local councils.
To provide inclusion to the Law of Ukraine «On Local Self-Governance» provisions on necessity to include the plans of local development of village and regional councils, house and street committees as well as municipal councils to the national development programs, including their adjustment and coordination
To plan regional development with regard to the development plans of community organizations adopted by community general meetings and coordinated with the general plan of territorial development.
To provide by means of legislation the possibility for planning the sustainable local development bottom-up, for the creation of appropriate mechanisms for common planning and control, as well as to provide for the training of local authorities on local sustainable development strategy development and implementation.
2. On providing the activities of local authority with material and financial resources at the level of cost of services that are guaranteed to the citizens by the Constitution of Ukraine as well as by the current legislation and on improving of intergovernmental relations, introducing of modern efficient systems and methods of management of municipal property:
1) To observe the provisions of the Constitution and current legislation concerning financing of powers delegated from executive authorities to local government:
- Transfer relations between the state and local government should be based on the clear distribution of powers adopted legislatively for every level of government;
- Calculation of equalization transfer payments from public budget to local budgets have to be realized according to the social standards of citizen services. These standards should be approved annually by the Law on the Public Budget and take into account specificity of functioning of social and cultural institutions in cities, villages, and small towns;
2) To create systems of encouragement of administrative and territorial units to upgrade their resources;
3) To create systems of the state responsibility for the establishment of macro parameters of the local budgets through the mechanisms of the refusal from performing of delegated powers and performing them by local state administrations;
4) To move to the direct calculations of intergovernmental transfers to all local budgets at the central level or through regional state administration (optional);
5) To implement the system of own revenues for district and regional budgets;
6) To initiate the systems of comprehensive territory development by means of co-financing of projects from different levels of government under the program of "government - region";
7) To extend the base of own revenues for local authorities first of all through the taxation of real estate.
Thus today it is possible to make some real steps showing the seriousness of Government’s intentions to implement the reform and to strengthen the local authorities' confidence to them, namely:
1. To refuse unconditionally from introduction of any privileges, that concern the taxes and fees that are entered in the local budgets. In particular, to abolish all social privileges and tax credit on the individual income tax, on the fixed tax, and on the land tax.
2. To administrate all taxes and fees, that is entered in the local budgets by tax authorities.
3. To cover by the state the cash breakages and deficiencies pursuant to the prognoses established by the state parameters of the income, that are taken into consideration when transfers are calculated. In particular it is necessary to provide for the subvention on returning of the mediate-term loans taken in 2004 in the draft law on modification of public budget on 2005.
4. To regulate the activity of the Treasury and to create the possibility to protest its actions.
5. To introduce the efficient legal procedure system on the public finance, in particular in the realm of intergovernmental relations.
6. To improve the transfer formula in a part of income calculation to ensure the responsible decision-making in local councils concerning taxes and dues, established by them, in particular unified tax, patents, and fixed tax.
7. To improve the system of governmental investment subventions by use of the mechanism of interest rates compensation on loans taken for the strengthening of municipal infrastructure.
8. For introduction of efficient market controls in sphere of legal regulation of economy at the local level it is necessary to implement the strategy of fast deregulation. For this purpose it is necessary to provide legislative base for development of centralized registry of legal acts that would be renewed periodically with the purpose of decrease of regulatory burden.
To organize at the local level series of one-window centers of registration of businesses to facilitate their registration, formation and functioning.
It is necessary to implement these principles at the legislative level by introducing appropriate amendments into Articles 11, 30, 37 and the final provisions to the Law of Ukraine "On fundamentals of state regulatory policy in sphere of economic activities"
9. To introduce appropriate amendments into the Law of Ukraine «On Local Self-Government» dealt with the providing to local authorities and local communities the right to possess and use municipal and community property. To implement legislatively defined principles and procedures on usage and control of municipal property, owned by city governments or separate communities.
To provide legal base for transferring program and project assets under the control and management of citizen organizations that took part in the implementation of mentioned programs and projects
To introduce appropriate amendments into the Budgetary Code to provide the possibility of resource mobilization at all levels of government with the purpose of implementation the projects aimed to development of citizen organizations.
10. To create legal and regulatory base to ensure and implement joint financing of the projects and programs developed and adopted through joint bottom-up planning process at the local level.
When reforming the system of intergovernmental transfers, to consider as an option the system of block grants for supporting and financing of local sustainable development initiatives.
11. To introduce necessary amendments into the Laws of Ukraine, regulating taxation of self-government authorities of the citizens. To reduce tax burden on the activity of these authorities engaged in resolving of social problems and realization of the joint projects in the appropriate communities.
To introduce appropriate amendments into the Law of Ukraine «On Self-Government Bodies of Population» to simplify the registration system of self-government bodies of the citizens at community level and the procedure of opening and servicing the bank accounts for them.
3. On reforming the system of territorial organization of government and administrative territorial system in Ukraine:
1) To create the base administrative and territorial units - community - with observance of principle universality of local government and to delimitate legibly territory of different communities;
2) To eliminate district state administrations, having passed their functions and powers to the district councils;
3) To improve mechanisms of formation representative and executive bodies of a local government at different territorial levels, to optimize their structure;
4) To review the status of local council deputies and the status of community heads;
5) To implement three-tier territorial government system - community, district (city district), region (AR Crimea, region, city-region);
6) To restore full-fledged local government at the regional (oblast) and sub-regional (district) levels, that, in particular will stipulate the creation of executive bodies of regional and district councils;
7) To change the tasks and functions of regional state administrations, having withdrawn from their competency such dimensions as social, economic, and cultural development of appropriate territories;
8) To perform legible distribution of powers and responsibilities between different types and territorial levels of government (vertically), as well as horizontally - between the community local authorities, regional council, district council and theirs executive bodies;
9) To create efficient mechanism of protection of national, regional and local interests at all territorial levels of government. To increase the role of associations and other voluntary affiliations of local authorities in representation and protection rights and interests of communities;
10) To perform an urgent survey of social, economic and financial state of administrative and territorial units at all levels. To draw up the inventory lists of administrative and social services that are delivered in mentioned administrative and territorial units;
11) To create the necessary organizational and legal as well as material and financial prerequisites for the formation of all-sufficient communities. To perform in 2005 the state-legal experiment on integration of the communities using as example several adjacent districts of specific region with the purpose of development objective criteria, algorithm of actions, and mechanism of public discussion
12) To develop legible criteria of optimization of district and regional division in Ukraine taking into consideration geographical, historical and other factors.
4. On improvement of the legislation on local elections:
1) To separate parliamentary and local elections in the time;
2) To hold the elections to the village, small-town, city, and city district councils under majority system;
3) To hold the elections to the municipal councils of regional centers under the proportional system;
4) To hold the elections to the regional and district councils under mixed system.
5. On interaction of central authorities, local authorities with the civil society structures:
1) To form National coordinating council on administrative reform, local and regional development at the President of Ukraine. Its participants would be People's Deputies of Ukraine, Heads of the profile ministries and central executive bodies, representatives of local authorities, scientific and educational institutions and public organizations that are engaged in local and regional development. The activity of the council will be coordinated by Secretariat that will act on the professional principles. In structure of Secretariat of the President of Ukraine it is proposed to implement institute of the councilor on local government development and regional policy;
2) To support the idea of creation of new institution - the Congress of Local Self-Government of Ukraine - as the highest representative body of local government and endow it with consultative-advisory functions;
3) To introduce into municipal practice more actively municipal hearings at different levels, including annual all-Ukrainian, inter-regional and regional hearings, as well as meetings of local authority associations. It makes sense to support continuation of all-Ukrainian competition of the projects and programs of local government development, having provided extension of circle of its subjects, in particular, public organizations;
4) To introduce and implement:
- Mandatory community and professional expertise of the drafts of the legislative acts as well as national and regional programs of social, economic and cultural development;
- Permanent monitoring of their realization;
- Activities aimed to ensure the feedback from population concerning social expectations and results of realization of administrative decisions, national projects and programs;
- Exchange of experience on innovative technologies application including administrative technologies;
5) To implement the contract relations at all levels of interaction, in particular to conclude the agreements on partnership and cooperation between public authorities and local authorities, public organizations, as well as business ventures;
6) To implement the mechanism of the social order for community participation in development and realization of the socially important programs at local level as well as community monitoring of their realization.
7) To prepare the normative and legislative base for creation of central executive body on regional development (ministry or agency) and of network of appropriate regional agencies to represent interests of local authorities in government and to raise the efficacy of local government
8). To complete the development and to adopt national policy and local strategy of sustainable development to bring them to conformity with European standards of local development and local governance
9) To decentralize and delimitate the powers between the central and local executive bodies as regards to the delivery of public services to the population.
