КЛАСТЕРНИЙ АНАЛІЗ ФІНАНСОВОГО РОЗВИТКУ ТЕРИТОРІАЛЬНИХ ГРОМАД ПОЛТАВСЬКОЇ ОБЛАСТІ

Abstract

The economic policy of Ukraine is formed through decentralization, which is based on the principle of delegating the powers of the central government to local self-government bodies. One of the goals of the decentralization reform is the creation of independent territorial units with a high level of the population’s quality of life. The main mechanism for achieving this goal is the implementation of not only public (administrative) decentralization but also financial decentralization. The development of an effective regional financial system allows for solving local social problems, which, under favorable conditions and effective public administration, will improve the quality of life of the population. In Ukraine, financial decentralization is implemented in several stages. The study showed that at the first stage, the components of the territorial communities’ budgets were formed, and their features were assessed. The second stage involved making changes to the Budget Code of Ukraine and increasing sources of income for the territorial communities’ budgets. We suggest that the next stage be the analysis of the implementation model of the communities’ financial activity with its further adjustment. An algorithm for ranking territorial communities according to their level of development is proposed based on the method of cluster analysis, which showed that the communities of Poltava region have different approaches to the implementation of financial and economic activities. Relatively the same economic activity is performed by communities of all clusters in the sphere of public safety, spiritual and physical development, environmental protection and social protection. Differences are reflected in the sphere of expenditures in the implementation of national functions, health care, economic activity and education. During the study, it was found that the territorial communities’ budgets of the Poltava region had an increase in budget funds in 2021 after the end of the second stage of financial decentralization. In particular, the share of tax revenues and interbudgetary transfers increased, because of changes to the Budget Code of Ukraine, the primary support of communities determines the increase in transfers, and the fulfillment of national tasks of the European Union. Analyzing the individual components of territorial communities’ expenses, it can be stated that Poltava and Kremenchuk urban territorial communities have a significant advantage in implementing the financial part, which is why other territorial communities need to improve the management system considering local features, opportunities, and needs.