Budget Expenditures of Ukraine: Integral Assessment of Structural Imbalances

Abstract

The public finance sector plays a special role in the functioning of the financial system. A significant part of the funds is accumulated and redistributed through state and local budgets. At the same time, the formation of budget expenditures of all levels, their structure, determine the state and opportunities for the state to perform its functions, which is manifested through the structure of budget expenditures according to functional classification, as well as the distribution of funds to ensure current needs and capital expenditures, and its social orientation - through the structure of expenditures for economic classification. At the same time, the state of formation of budget expenditures at different levels is characterized by structural imbalance, so the article evaluates the formation of state, local, and consolidated budget expenditures according to economic and functional classification. The method of structural-dynamic analysis was used during the research and integral coefficients were calculated - linear and quadratic coefficients of structural shifts, integral coefficients of Gatev and Salai, which made it possible to substantiate the state of unbalanced budget expenditures of all levels. For the study, the period from 2015 to 2021 was taken on a quarterly basis, separately according to the expenses of the economic classification and according to the expenses of the functional classification of the state, local and consolidated budgets of Ukraine. In contrast to existing approaches, this study takes into account the peculiarities of the formation of expenses, which are associated with their quarterly fluctuations. It is substantiated that the structure of expenditures according to the economic classification of state and local budgets is unstable. The calculation of integral coefficients made it possible to draw a conclusion about the significant intensity of structural shifts, which indicates the absence of a consistent budget policy, since it, in turn, is based on the consistency of the economic policy implemented in Ukraine. The imbalance of expenditures by functional purpose, compared to the structural imbalance of expenditures by economic classification, is much smaller. The obtained indicators proved the process of redistribution of cash flows between budget levels as a result of reforms in Ukraine, related to decentralization and redistribution of powers between the national and local levels.