Kyiv, March 15, 2016. The essence of the reform of the State Reserve Agency of Ukraine is to reduce the huge nomenclature system to an optimal quantitative and qualitative state and optimize the number of custodians of tangible assets. It is proposed to give the State Reserve Agency the right to manage cash as well. This is written in the draft law on strategic reserve. The document provides automatic refreshment of tangible assets. It also introduces a new mechanism of allocating them – within 24 hours, followed by official registration of papers and obliges local authorities to report on their local reserves. Vadym Mosiychuk, Head of the State Reserve Agency of Ukraine, said this at a briefing at Ukraine Crisis Media Center. He added that the draft law is currently accorded with the Ministry of Economic Development and Trade of Ukraine.
According to Mr. Mosiychuk, the State Reserve introduced an accountancy system for all businesses and organizations, as well as full monitoring of their activities and plans. To do this, they set up a conciliation board. Also, all managers had undergone re-certification. “Our requirement is that under new conditions we should work transparently, efficiently and with zero tolerance to corruption,” said Mr. Mosiychuk and added that only 10% of the then leaders of enterprises had realized it. Over the past six months, 14 of them were dismissed, and 6 new were appointed according to the competition. Then the companies became profitable. Mr. Mosiychuk stressed that in 2014, their income was 245 million hryvnia, and in 2015 – already 350 million. In 2016, they plan to earn 408 million and generate up to 10.5 million profits. Since January 1, 2016, new managers’ salaries will be from 20 to 60 thousand hryvnia. “Due to the market-close rates, we can require them to introduce more effective mechanisms,” believes Mr. Mosiychuk. He added that documents on five criminal proceedings for former directors of the State Reserve Agency companies have been submitted to the law enforcement agencies.
Mr. Mosiychuk informed that his organization joined the e-procurement system. Thus 20% savings were achieved. According to him, the tenders for the diesel fuel purchase were expected to save 50 million hryvnia. However, “this process was stopped by market participants who wanted to win in a non-competitive way through the Antimonopoly Committee and turned it to the stage of bid evaluation.”Even if the structure with the new management and transparent rules of the game is open to market participants, not all market participants will be sincere in their wishes,” he said.
According to Mr. Mosiychuk, the State Reserve Agency has filed a number of court actions to return 2.7 billion UAH debts. Among the debtors are “Naftogaz Ukraine,” SJSC “Bread of Ukraine, etc. The audit revealed that 1.7 billion hryvnias had been simply stolen. Currently, more than 3.2 billion UAH already in execution proceedings on a number of cases. The Head of the Agency noted that over the previous year the State Reserve paid 66 million hryvnias to the state budget as taxes and fees. The same amount was received from the state for wages and utilities payments. “We did not receive any revenues from the state for accumulation or saving of tangible assets. This trend is not acceptable. In all European countries the state reserve system is financed exclusively from the state reserve,” he stressed.
According to Oleg Prokopchuk, first deputy head of the State Reserve Agency of Ukraine, the Agency is also responsible for creating oil and gas reserves for the country. This is a requirement of the Ukraine’s Association Agreement with the EU on creating a system of emergency stocks within the energy security of Europe. “Ukraine needs 5 years to create oil and oily products reserves equivalent to 2 million tons of oil,” informed Mr. Prokopchuk. The corresponding law and operation model should be developed this year.