Poor Ukrainians to Receive Cash Utility Subsidies, Goal to Drive Down Energy Consumption
Ukrainian President Petro Poroshenko unveiled a plan to pay poor Ukrainians cash subsidies for utilities. The goal of the program is to help reduce energy consumption
Photo by Mykola Lazarenko
During a meeting at the Ministry for Social Policy of Ukraine, the Ukrainian President Petro Poroshenko explained the plan to give to poor citizens cash subsidies for utility expenses.
“Right now, on February 6th, we are launching a long-awaited system of monetization of subsidies, that is, cash payments to low-income groups of population. The average payout is 1,500 UAH. And after the recipient of the subsidy pays for the services consumed, cash remains at his disposal,” Poroshenko said.
“I want to congratulate everyone, because starting from March 4, the recipients of the subsidies will receive cash. And this is a significant step in the fight against poverty,” Poroshenko said and specified that this applies primarily to the poor, most of whom are pensioners.
“Does the subsidy mechanism work efficiently? On the one hand, it is effective, because everyone who is eligible for subsidies has access to them under a simplified procedure, without excessive bureaucratic delays. But on the other hand, are gas consumers, consumers of utilities, consumers of subsidies interested in reducing energy consumption today? No. Because no matter how much you consume it doesn’t affect your financial situation. That is why there is a very disturbing statistic, when consumers of subsidies consume 1.5-2 times more gas than those who pay for them with real money,” Poroshenko said.
Poroshenko also noted that “the monetization of subsidies is aimed at overcoming poverty, fighting poverty, when the money saved remains at the disposal of the poor and increases their level of social protection.”
“My goal, and this is not for March, this is forever, is that subsidies stay in the form of cash so that people can save money for their own needs, so that they have a motivation to reduce energy consumption,” Poroshenko said.
Poroshenko also emphasized the importance of ensuring energy independence and set the task for Ukraine to start meeting its needs with its own resources in five years time. The cash subsidy program could help with this goal if energy use drops because of the program.
“Ukraine has to do without procurement of imported gas – due to the increase of its own gas output, due to the energy saving and due to the energy independence for ensuring this. … And we set the task for the next five years to ensure the energy independence of the state,” Poroshenko said.
Poroshenko also expressed confidence that energy saving and energy efficiency can work only in conditions “when the entire population of Ukraine, the whole nation is interested in the implementation of this task.”
“Through energy saving measures, we will be able to ensure the full energy independence of Ukraine in the coming years. Including, first and foremost, from the supply of gas from the Russian Federation. We will permanently put an end to the “gas needle” on which all Ukrainian presidents and governments were dependent until 2014,” Poroshenko emphasized.