Elephant in the room and holes in the budget. Why did the government stop funding non-critical expenditures and what will happen next?

28.09.2026, 06:00◉ 03 min readEditorial team “SHCHO STALOSIA”

Ukraine constantly needs money for the war, because its cost increases every year. Apparently, therefore, the talk about the government's search for additional billions of dollars has already become almost commonplace and does not cause surprise.

Elephant in the room and holes in the budget. Why did the government stop funding non-critical expenditures and what will happen next?

However, since August, the highest state officials have been talking about the critical situation with funding.

Initially, President Volodymyr Zelenskyy announced an additional need of the Defense Forces in the amount of $27 billion. Then Prime Minister Serhii Koretskyi announced the beginning of the "austerity regime". Subsequently, Finance Minister Serhii Marchenko announced the start of spending restrictions and did not rule out a return to the "printing" of money.

In mid-September, statements and warnings of high-ranking officials materialized. The government began to halt funding for anything unrelated to the war or social security. Payments are not made not only for the construction of roads or the protection of energy facilities on the eve of winter, but also for utilities or schoolchildren's trips to international Olympiads.

Details

But why is this year's "hole" in the budget only a rehearsal in the face of really significant financial problems?

"The Ministry of Finance has made changes to the list of the state budget and postponed some expenditures of September, October and November to December. First of all, these are capital expenditures: construction and reconstruction, including hospitals, construction of shelters in hospitals and schools, energy protection, construction of social housing, etc., "the head of the committee on on the budget of the Verkhovna Rada of Roksolan Pidlas.

Context

The situation is complicated by the attacks of Russians against Ukrainian business, as well as the need to find money to protect themselves from them and strike back. In 2027, the price of war will increase, but it will become increasingly difficult to find sources to cover additional costs.

The spending cap also applies to the financing of 'sustainability plans'. The suspension of the construction of protective structures around energy facilities on the eve of the next most difficult winter in history in itself indicates a critical situation in public finances. However, the restrictions do not only apply to capital expenditures.

What's next

According to Pidlasa, the Ministry of Finance postponed capital expenditures worth UAH 39 billion from September to December. "But when we talk about capital expenditures, we understand that postponing them to December means that this year they will not be funded at all, because it will simply be impossible to do," she said.

Why was the state budget "stranded" in the middle of the year? Firstly, due to the intensification of Russian attacks on Ukrainian business, tax revenues began to decline. In August, the gap from the revenue plan was almost UAH 16 billion.