One third of Ukraine's budget goes to pay military – Finance Ministry

The maintenance of military personnel was the largest item of expenditure from the general fund of the state budget, amounting to almost UAH 520 billion (approximately US$14 billion) in the first seven months of the year, or a third of all expenditure during this period.

Source: Ministry of Finance of Ukraine, citing the State Treasury Service of Ukraine

Expenditure from the general fund of the state budget for January-July of this year totalled UAH 1.64 trillion (roughly US$44.32 billion), including UAH 231.8 billion (US$6.26 billion) for July.

The largest item of expenditure (40.8% of the total) was wages with accruals: UAH 669.9 billion (US$18.10 billion) was spent on this. Moreover, UAH 518.8 billion (US$14.02 billion) was allocated to the maintenance of military personnel. In July, a total of UAH 100.5 billion (US$2.72 billion) was allocated to wages, of which UAH 76.9 billion (US$2.08 billion) was allocated to the military.

The second largest item is payment for the use of goods and services (24.8% of total expenditure) – UAH 406.3 billion was allocated to this, including UAH 65.3 billion in July.

More than half of this amount also goes to the Armed Forces: UAH 276.9 billion (US$7.48 billion) was spent on the purchase of military equipment, weapons, ammunition, personal protective equipment, fuel, food, etc. A further UAH 78.6 billion (US$2.12 billion) was transferred by the National Health Service to the programme of state guarantees of medical care for the population.

The third largest item was social security (pensions, scholarships, etc.), at UAH 304.6 billion (roughly US$8.23 billion). Of this amount, UAH 159 billion (US$4.30 billion) was transferred to the Pension Fund to ensure the payment of pensions, and UAH 105.5 billion (US$2.85 billion) for payments by the Ministry of Social Policy for social protection and support.

Also among the largest items are transfers to local budgets (5.6% of all expenditure, or UAH 92.3 billion (US$2.49 billion) and servicing of the national debt (7.8% of expenditure, or UAH 128.1 billion (approximately US$3.46 billion).

Background:

• Annual expenditure from the general fund of the state budget is currently forecast at the level of UAH 2.8 trillion (about US$76.5 billion), while revenues are projected to be UAH 1.4 trillion (about US$38.75 billion). The gap is being filled by international aid from Ukraine’s partners. Ukraine can spend only its own funds, i.e. the taxes it collects, on defence measures.
• Military personnel are paid a cash allowance (similar to a salary) and monthly bonuses established for the period of martial law (about US$800, US$1,350 or US$2,700).
• In August, the government changed the procedure for payment and the amount of additional compensation for servicemen: they were refunded additional payments of UAH 30,000 (about US$800), and payments for wounded soldiers, instructors, cadets and conscripts were stipulated. The changes concerning the payment of additional remuneration will apply starting from 1 June 2023.

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