Most of the strategies for the coal industry have not been implemented – DiXi Group’s analysis
DiXi Group experts analyzed the effectiveness of public spending on the restructuring of the coal industry during 2015-2020.
The results of the analysis were presented during an online event on 4 December.
Eight performance indicators were used, project expert Serhii Balan said during the presentation of the study.
“Today, Ukraine’s coal industry is in critical condition. And the government’s approach to the restructuring of coal enterprises included mainly the economic aspect, namely the volume of coal production and its profitability,” Balan said.
According to experts, the assessment of the effectiveness of public spending on the restructuring of the coal industry during 2015-2020 shows that the government “constantly overestimated the targets, the achievement of which required additional funding.” For these reasons, the current Concept of Coal Industry Reform and Development for the period up to 2020 has not been implemented.
“There is a weak correlation between the amount of financial state support for the coal industry during 2015-2019 and the selected performance indicators. The volumes and directions of budget funding of the coal industry in recent years have not fully complied with the policy and strategic documents. And most of the funds was used to cover arrears of wages of state-owned coal mining companies,” the experts summed up in the study.
Based on the analysis, DiXi Group experts prepared recommendations on how to optimize budget planning in the coal industry. The full text of the study will be published on our website soon.
The analysis was performed in September-November 2020 with the support of Heinrich Boell Foundation Kyiv Office (Ukraine) in the framework of the project “Budgetary Aspects of State Policy on the Closure of Coal Mines”.The objective of the project is to conduct an unbiased analysis of the efficiency of state budget expenditures in 2015-2020 aimed at restructuring coal companies, and to draw the attention of the public and key stakeholders to the dependence of the coal industry on government subsidies in order to increase the social acceptability of the gradual abandonment of coal and justification of the need to switch to green energy.