Financing the needs of the defence sector in Ukraine

Abstract

Purpose. The aim of the article is to comprehensive study of the financing of expenditures for the needs of the defence sector in Ukraine, practical study and analysis of their composition and dynamics for the national security and defence of the state in the ongoing aggression of the Russian Federation. Methodology of research. A set of general scientific research methods was used to achieve the defined goal and objectives, which made it possible to present directions for improving the process of financing the expenditures of the State Budget of Ukraine for the needs of the defence sector. The scientific literature, normative and legislative documents on the topic of scientific research are considered. Thus, descriptive statistics were used in the analysis of data on the amount of financial support for military expenditures from the state budget. A method of comparison was used to identify trends and patterns in the financing of expenditures for the needs of the defence sector of the state. It allowed to identify the dynamics of defence expenditures on their functional basis. With the help of a systematic approach it was possible to study the patterns of financing the expenditures of the Ministry of Defence of Ukraine and to identify the need to provide budget funds for innovative developments and capital investments in the production of military equipment and military education. Methods of classification (typology) were identified to systematize the factors that have a significant impact on strengthening the defence and national security of Ukraine, and thus on the social and economic development of our state. Findings. The main reasons for the reduction of funding for expenditures for the needs of the defence sector in Ukraine are identified, which are primarily: the lack of budget requests from the Ministry of Defence of Ukraine, which are not registered by the State Treasury Service of Ukraine; imperfection of the legal and regulatory framework in the field of financing military expenditures in relation to their ratio to GDP; lack of financial component in the strategic plans for the development of the defence complex of Ukraine. This is accompanied by negative social and economic phenomena and a tense political situation in the country due to hostilities in the East. The main directions of solving problems in the field of financing defence expenditures in Ukraine are substantiated, which include: bringing in line with the provisions of certain regulations governing the relationship between expenditures for the needs of the defence industry and GDP; establishing the projected amounts of expenditures for the medium and long term, providing for their mandatory amounts in the financial component of the documents on the strategic planning of the development of the defence-industrial complex of Ukraine; increase in capital transfers of the special fund of the State Budget of Ukraine to finance the needs of the state defence sphere, taking into account the need for innovative developments and capital investments in the production of military equipment; formation of the state order for the industrial enterprises of machine-building branch, capable to make accessories for needs of a defence industrial complex; reducing corruption by ensuring greater transparency in the governance of military authorities and the implementation of NATO procedures, principles and standards. Originality. The directions of improvement of practical approaches in the field of management of budgetary funds directed on financing of the defence sphere in Ukraine are singled out. Practical value. The results of scientific research can be implemented in the activities of public administration in terms of the use of measures of operational management of public expenditures on defence and national security in a military conflict. Key words: state budget, expenditures, budget request, functional classification of expenditures, military activity, national security.