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Challenges to and Opportunities for Regional Development in Ukraine
Ukraine officially gained its independence from the Soviet Union on August 24, 1991. Since independence, Ukraine’s development has been characterized as both complex and slow. Many of the transitional reforms towards democracy and a market-based economy have not yet been implemented. The 1996 Constitution did contribute to reforming the government by delineating the roles and responsibilities of the Oblast State Administrations (regional executive authority) and elected Oblast Councils (local self-government bodies).
However, it did not go far enough in this reform process, leaving major challenges to regional governance and development in Ukraine and placing most of the authority with the regional executive authority, which is accountable only to the central government, rather than with the regional elected councils, which are accountable to the citizens. Such systematic challenges, a lack of a clear delineation of authorities and a lack of understanding of the need for and the procedures of decentralization, are exacerbated by high levels of corruption, a poor understanding of the basic approaches to sustainable development, a lack of good governance, and inefficient public service provision at the regional and local levels.
The key regional development problem, which has evolved in Ukraine over the last decade and requires immediate intervention, is the increasing disproportionate socio-economic development and economic activities between the regions. This increased disparity in social, economic and cultural development significantly complicates the implementation of common socio-economic reforms and the formation of a national market for goods and services, and increases the risk of regional crises and the weakening of the national economy.
In this context, the most pressing needs currently facing Ukrainian government are the coordination of strategic goals and priorities of the central government with those of the regions, decentralization and delineation of authorities in terms of the provision of public services, and introduction of mechanisms of public control at each level of public administration.
In 2004, the Orange Revolution spawned a reform process, which will eventually entail empowering the Oblast Councils as popularly elected bodies to become the leading government body at the oblast level. Moreover, the President’s “Towards the People” program is dedicated to introducing participatory, inclusive mechanisms into government activities and to decentralizing government responsibilities to the regional and local level. These changes to government programs, legal structures, and public opinion, resulting from the Orange Revolution, will provide an impetus to the RGD Project as it makes a contribution towards the pressing needs of Ukraine.
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Current Status of Regional Governance and Development in Ukraine
In practical terms, Ukrainian regional policy has not undergone significant changes since independence. The sectoral approach of central government agencies to regional development continues to dominate, with resources to meet regional needs being distributed on the basis of subjective criteria. Each Ministry, as the main budget-spending agency, plans and implements its policy in the regions in line with its own sectoral visions and needs, which in most cases is not adequately related to holistic regional development problems and is poorly coordinated between the sectors involved in each region.
Despite the Law of Ukraine “On State Forecasting and Drafting of Socio-Economic Development Programs” that mandates consistency in and coordination of annual development programs at both the national and regional levels, in practice such consistency and coordination are not evident. Oblast State Administrations are often unaware of the resources allocated by the state budget to the main budget-spending agencies for current and capital expenditures for the region. There exist no efficient mechanisms to adjust and coordinate the regional development interests of the national and sub-national governments.
With the adoption of the Concept of State Regional Policy (CSRP) and draft Law of Ukraine On Principles to Foster Regional Development, the Ukrainian Government has begun to shape an effective regional policy. Recently, with the goal of introducing strategic programming to regional development policy at both the central and regional levels, the Government of Ukraine prepared the draft (Concept of) State Strategy for Regional Development (SSRD). It specified strategic objectives, long-term priorities of regional public policy and implementation methods.
The key impediment to the successful implementation of the SSRD of Ukraine is the inadequate capacity of national and regional governmental structures, given the complexity of the reform effort required. Both the central and regional governments often lack the leadership skills to be truly open to cooperative approaches to regional development. Partially due to the number of highly qualified people who have left the public service in recent years, the overall professional capacity of the Ukrainian public service has declined. In addition, effective implementation of the SSRD requires new knowledge and skills to which public servants have had very little exposure. Limited government resources do not allow for allocation of substantial funding of professional development for public servants responsible for regional policy implementation. The problem is further complicated by the lack of relevant modern regional development knowledge and experience among public servants.
Another major challenge to the successful implementation of the SSRD is the need to have well-grounded development strategies for all Ukrainian oblasts. The CSRP Action Plan and subsequent SSRD require that each Oblast State Administration develop a Regional (Oblast) Development Strategy (RDS). Most regional governments have not yet been capable of producing an adequate strategy, as they still do not have the skills or capacity to conduct the participatory process necessary to deliver such a strategy.
To date, regional development strategies have been prepared in a traditional ‘Soviet central planning’ style. In most cases, a regional development program prepared by oblast authorities represents the mechanical sum of individual measures planned by each central government body operating in the territory. In many cases, oblast authorities do not even know in advance about the measures planned for their territories by different Ministries. This situation, with vertical and horizontal coordination gaps, presents a serious problem, impeding a comprehensive approach towards the development of regions and diffusing the limited resources available for regional development. Therefore, there is a pressing need to develop and implement an alternative approach to regional development programming, one that is focused on the preparation of Integrated Development Strategies for targeted territories, allowing for the consolidation of efforts and the incorporation of both government and non-government local resources and initiatives in regional development planning.
Another important element of a comprehensive approach to regional development, which is still absent in Ukraine, especially at the oblast level, is public involvement in the process of developing a strategy for the region. In other words, extensive consultations with the public of the territory on major development priorities are a key prerequisite for the successful and efficient implementation of a regional development strategy.
The RGD Project aims to address these challenges to the successful implementation of the SSRD at both the regional and national levels.
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Current Status of and Prospects for Strengthening Civil Society Involvement in Regional Governance
The current political environment in Ukraine is generally conducive for civil society involvement. However, political will and a favourable political environment are only part of the solution. Several critical issues remain to be addressed in order to foster more effective engagement.
There is no widespread tradition of public involvement in sub-national government affairs in Ukraine. Most local groups are more inclined to take their concerns directly to central government ministries and agencies than to regional-level government bodies. This has occurred largely because of the limited roles and responsibilities of local government and the absence of any sustained campaign to educate the public about what these roles and responsibilities are and should be. While civil society in Ukraine today is calling for increased participation in decision-making, the governance machinery is still inadequate to listen to and respond to these demands. Under the present circumstances, it is clear that building civil society and promoting greater public involvement in regional government remains an acute need for Ukraine.
Much remains to be addressed within the structures of state authority (national and regional) to neutralize the bureaucratic inertia that has often hindered civil society engagement and impeded the implementation of innovative solutions brought forward by civil society organizations and leaders. Even when the political will is strong, the leadership skills to be truly open to cooperative approaches to regional governance and development may often be lacking.
Principles of effective engagement between civil society and the state are based on the assumption that civil society brings a level of legitimacy to the participatory governance table. However, the public’s current perception of some civil society organizations (CSOs) and the sector at large indicates that this needed level of legitimacy has not been reached. This may be due to the lack of transparency, accountability and ethical norms within some CSOs; undue affiliation with political parties on the part of a few CSOs; and outright corruption by a small number of CSOs. Examples of CSOs started by politicians and in some cases by the government in power are not hard to find. Much remains to be done by the sector to gain public trust and thereby achieve the needed level of legitimacy to participate effectively in regional governance.
The major obstacles to cooperation between CSOs and regional authorities include: lack of legal mechanisms for public control over the activities of public authorities, lack of available information on the activities of regional authorities or channels for disseminating this information, and a lack of understanding of the need to cooperate with the organized public.
As Ukraine moves toward the realization of a strengthened regional government system, effective public management will be necessary to achieve good governance practices at the oblast level. The involvement of civil society promotes good governance in several ways. It augments the legitimacy and capacity of regional governments by contributing to better-informed decision-makers and by rendering processes more open and transparent. It enhances public awareness and consensus about the responsibilities regional government should have and how it should undertake them, thereby generating ownership over and commitment to change. It enables the development of social capital by encouraging the emergence of new leaders and organizations in the community and the strengthening of those that are already active.
A key principle of the RGD Project will be to integrate CSOs and the public at large in the planning and decision making processes of the regional governments.
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Cross-cutting Themes of Regional Development in Ukraine
Gender – Although the Constitution of Ukraine enshrines equal rights and freedoms for all citizens, the record on applying these rights has not yet met the provisions in the Constitution, related legislation and international conventions. Despite official commitments to gender equality, the majority of citizens do not consider gender stereotypes to be an obstacle to women and men achieving their goals. Traditional values and attitudes persist. Statistics on gender discrimination, like statistics in general, are not trusted by the public. The judiciary does not have a record of upholding gender equality principles. Gender discrimination persists and is widely tolerated. Several critical gender/age issues, such as labour force discrimination against women, poverty among the rural population, unemployment (both women and men) and its impact on the family, and skills training for youth, remain to be addressed.
However, some policy-level progress has been achieved. In particular, the Yushchenko government has made a number of changes to the gender equality program in the Ministry of Youth and Sport (MYS) and there are suggestions that ‘regional gender counsellors’ may be appointed to assist regional governors in addressing gender issues. Legislation to formalize and provide core support to the existing network of gender bureaux (one in each region) established by the MYS may be passed soon. Also, the Parliament of Ukraine is scheduled to vote on the “Law on Equal Opportunities for Women and Men” in the fall of 2005.
A key aspect of the RGD Project will be to ensure all groups are able to participate in the regional development, planning, and governance processes.
Environment – The difficult transition to a market economy has presented Ukraine with many environmental challenges and significant environmental problems, especially those resulting from the Chernobyl nuclear power plant disaster in 1986 and from industrial pollution. Greater public awareness of these threats has resulted in greater public participation in decisions affecting the environment. However, more is needed especially as many of the measures intended to improve the environment suffer from a lack of financial resources. Several critical issues such as air pollution, development of renewable energy resources, water supply, and nuclear issues remain to be addressed. Additionally, the public’s low level of awareness of their rights, somewhat passive stance on environmental issues, and distrust of authorities prevent public engagement at all levels of the decision-making process related to environmental issues.
Currently, environmental legislation in Ukraine includes over 200 laws and by-laws and Ukraine is party to 26 environmental conventions. However, the distribution of responsibilities between the executive authorities (Oblast State Administration) and local self-government (Oblast Council) is not clear and environmental protection laws are rarely enforced. Fortunately, economic mechanisms for nature management and environmental protection activities (pollution fees, etc.) have been introduced to address these deficiencies.
A key aspect of the RGD Project will be to ensure environmental considerations are included in the regional planning processes.
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