Fellow Ukrainians!
Most Holy Fathers!
Distinguished foreign guests!
Dear people’s deputies!
Dear Mr. Prime Minister, dear members of the
Government!
Everyone who personifies Ukrainian authorities today
clearly realized all the responsibility a year ago. One may shiver remembering
the conditions of the country left by the kleptocratic regime of Yanukovych,
which has been deliberately leading the country to the national disaster for 4
years and tried to put an end to the Ukrainian history planned beyond Ukraine.
Except budget, because money wasn’t entrusted to
anyone, everything was given at the complete disposal of the neighboring
country, which has been rapidly dismantling Ukraine. In addition to the
liquidation of the army and special forces, there was a fact that Russian
citizen was dealing with the issue of reverse gas supply from Europe in
Naftogaz. Together with the entire gang, he fled to Moscow right after the Revolution.
What do we recall from those days? Crimea was annexed.
Russian militants invaded the bigger part of Donbas. Separatists incited by
Moscow are trying to instigate pro-Russian manifestations in Kharkiv, Odesa,
Mykolaiv, Kherson and many other cities. Kremlin was preparing to the partition
of Ukraine. It knew that the fifth column had completely destroyed the
Ukrainian army, disarmed it, left it naked and barefooted. A bit more than
5,000 soldiers were ready to perform the tasks in March 2014 and still they had
to find fuel to get to the front. Looking ahead I would like to mention that
now more than 50,000 Ukrainian heroes are defending the country in the ATO
area. The overall strength of the Armed Forces equals to 250,000. Today, we are
capable of defending the Homeland.
At that time, law enforcers demoralized by Maidan
scattered. Armed persons emerged in the cities. Under the guise of sacred names
of Maidan activists and volunteers, they were doing robbery and racketeering.
“Regionals” and communists were involved in the old
Parliament. Every day they’ve been trying to raise their heads.
There was a real vacuum in the State Treasury. People
even forgot the smell of money there notwithstanding the fact that Ukraine
borrowed more money in 2010-14 than in all other years of independence.
Why do I recall these facts? Sometimes one must recall
the past in order to correctly predict the future. We must remember the edge of
death that we have avoided.
Our main achievement of the past year is that we have
saved Ukraine despite all the deaths. And by the word "we" I mean all
of us, a great Ukrainian nation. This brings to mind the words of Vasyl
Symonenko: “My people exist! My people will always exist!
No one can blot out my people!”
Dear people’s deputies!
Six months ago we have formed our reformist majority,
launched partnership relations between the President, Verkhovna Rada, Prime
Minister and Government.
People often ask me whether I am content with the work
of the Government. No. Whether I am content with the work of the Parliament.
Certainly, no. I am not even content with my work. I can’t complain about the
lack of criticism in the press, but nobody criticizes me more than myself.
Do you know why? Because people are not content with
our work. Yet, we have no right to blame the people who have entrusted the
country to us. We shouldn’t complain about strict requirements and criteria.
You, people’s deputies, ministers, just like me, President, are definitely not
those who suffer most in the country.
Our common task is to triple our efforts for the sake
of changes in the country. We should also analyze the conformity of our actions
to the chosen strategy and plan the nearest tactical steps and tasks.
The Ukrainian nation has determined the strategic
course in the course of the Revolution of Dignity and during early presidential
and parliamentary elections. These three events became an apparent and
irrefutable factor of European choice of Ukrainians.
The end of the infamous multivector orientation has
brought full clarity in the issue of not only foreign orientation, but also
domestic policy. I mean unequivocal and irreversible course towards the EU
membership and profound Europeanization of Ukraine. The period of pompous
ceremonial procedures has passed. We have begun a hard, laborious and routine
homework to ensure European integration.
Determination of Ukrainians to switch from historic
sideways to modern European highways turned out to be against the hair for one
of our neighbors. When the enemy started the annexation of Crimea and
aggression in Donbas in February-March 2014, it planned that Ukraine would
disappear from the political map of Europe.
Kremlin expected that bacilli spread by Russian special
forces would provoke the epidemic of separatism in all Eastern and Southern
regions. However, this idea failed everywhere, including Donbas. Even in the
temporarily occupied territories of Luhansk and Donetsk regions separatists
retain power solely due to the Russian bayonet. And several weeks ago, authors
and promoters of “Novorossiya” project put a large tombstone on it.
In a year, country that got used to the reckless
policy of absurd pacifism has created modern Armed Forces that have liberated
the bigger part of Donbas from occupants. Volunteer battalions, volunteers,
workers of the military-industrial complex, millions of patriotic Ukrainians
and our heroic Armed Forces have ensured a true miracle. We have stopped the
strongest army of the continent on our Eastern frontiers. Because not “miners”
or “tractor drivers” are fighting against us there, but Russian regular troops
armed cap-a-pie. We have convincingly proved it to the entire world.
Despite the success in the creation of the army, we
must honestly admit: we have ensured only minimal level of defense capability,
though it is completely different from that of the previous year. We haven’t
patched all the holes, sometimes we still lack the basic necessities especially
because the size of the army is increasing. If we look at a static picture, it
is full of flaws, doesn’t have too many achievements and has too many
shortcomings. But speaking of dynamics over the year we have nothing to be
ashamed of.
Volunteer troops in the Ministry of Defense became an
example of cooperation between the government and civil society. With their
selfless daily work, they transform this conservative, cumbersome and clumsy
governance system ossified since the days of Voroshilov and Budyonny. And this
titanic work should be continued, because the reform of the Armed Forces is
still far from being finished.
***
We couldn’t stop the enemy without broad international
coalition in support of Ukraine and efficient international sanctions against
Russia. They caused a powerful shot on Russian economy and dropped Russian GDP
significantly.
It is symbolic that in the coming days, on the eve of
the G7 Summit in Germany, global leaders, our reliable partners and friends
will visit Kyiv. On June 5, Prime Minister of Japan Shinzo Abe will make the
first official visit to Ukraine in the history of Ukrainian-Japanese relations.
On June 6, a great friend of Ukraine and Ukrainian nation, Prime Minister of
Canada Stephen Harper will arrive. It is a true demonstration of solid and
comprehensive support of Ukraine by the whole world. It is very symbolic –
Canada on the American continent and Japan in the Far East. The entire world.
Impressing solidarity with Ukraine, though globally
caused by a positive impression from the pro-European Revolution of Dignity, is
not generated automatically! It requires significant, sometimes titanic efforts
of the Ukrainian diplomacy, which contributes to the protection of the Homeland
just as the Armed Forces.
Russia opposes us not only along the state border and
the collision line, but also in all the countries of the world. It doesn’t
spare its unlimited resources. Geography of anti-Ukrainian activity is global
in its nature. However, our friends in America and Europe strongly hold
consolidated position and Russia cannot make a hole in it despite all the
efforts. To prevent this is the main task of our diplomats.
We have once again felt a powerful European
international unity two weeks ago in Riga at the Eastern Partnership Summit.
Despite the fact that Ukraine is in the state of war, despite the fact that
part of our border is controlled not by us, despite the fact that Ukraine has
hundreds of thousands of IDPs kicked out by Russia from their places of
residence, despite the fact that we were frankly told about this main obstacle
in non-public conversations, visa-free regime prospect has acquired a fixed
place in the calendar for the first time. But to finish successfully, we need a
corresponding spurt. All technical issues must be completed by the end of August.
In September we expect the last EU assessment mission. I will personally
control this busy schedule on a daily basis. And the Government, my partner,
has to feel our great responsibility.
By the way, speaking of the responsibility. I have
just received a report that pursuant to my insistence the Head of the State
Migration Service had been dismissed, because the largest number of complaints
of our European partners had concerned that institution.
Finally, the Association Agreement signed a year ago
will fully start functioning on January 1, 2016 despite vain efforts and
impotent malice of our former “strategic partner”. I would like to see the Vice
Prime Minister responsible for the European integration in the Government. I
would like the Government and coalition to solve this crucial issue.
Large-scale macro-financial aid from the IMF, other
international organizations, countries of the European Union, the United
States, other countries (fresh example is the decision of the G7 to uphold
Ukraine in the issue of restructuring our external debt) in combination with
difficult and very unpopular decisions and efficient actions of all branches of
power allowed us to avoid default, stabilize macro-economic situation, pay
wages and pensions without a delay, which is impossible for a country at war,
slow down the economic downturn, overcome panic in the currency market.
Unfortunately, there are no examples in the world history when a country facing
the aggression demonstrated economic boom and growth of social standards.
Let us recall apocalyptic mood of the last autumn.
Suspension of gas supply from Russia, huge shortage of coal, rolling blackout
across the country - it really did not add optimism. Someone expected snow and
frost as if it would be a doomsday. However, we didn’t only spend winter with
heat and light, but also "got off the gas needle” of Russia for the first
time in 23 years of our independence. For the first time we have ensured the
reverse supply of natural gas from Europe and significantly reduced dependence
on Russians. It is called energy security and diversification not by words but
by deeds. We have been talking about it for 23 years.
There are no more intermediaries which have been
parasitizing in the gas market in Ukraine for decades. We have put an end to
the monopoly and blackmail of Gazprom! Even though Stockholm arbitration will
make a decision on our claim to Gazprom only in 2016, we have already
eliminated negative consequences of the contract of 2009, when the gas price
for Ukraine was one and a half or even two times higher than for Europe.
In the first quarter of 2014 our gas dependence on
Russia exceeded 90%. In the first quarter of 2015, the share of Russian gas in
our exports equaled only to 37%. We already have more than 10 suppliers from
the EU. It is one of the most significant strategic changes in our reforms,
which must be irrevocably fixed in the next year or two.
***
Reforms are the key word in my message today. To
create real conditions for their beginning, I have made a difficult decision to
dissolve the old parliament and conduct early parliamentary elections which
have been the most fair, transparent and democratic in the history of Ukraine.
We have formed a reformist majority, a coalition government with a clear
program of changes, for which the entire coalition is responsible and I am very
grateful to you for that. The countdown of the period of reforms has started
from that moment.
If you imagine yourself a chef, you can say that a lot
of dishes are in the oven already. All the necessary ingredients have already
been collected for some dishes. For some dishes we haven’t known the recipe
earlier. It is called the “current status of reforms” in the dictionary of the
National Council of Reforms. I have established it by my Decree from the
representatives of all branches of power, experts and civil society activists
in order to coordinate all projects of reforms.
Five-six months are extremely short period for having
the results. However, the cup of public patience is overflowed and we have no
other choice than to speed up.
Reforms are not yet at the finish, but not already at
the start. Changes and developments are felt mostly by experts and participants
of the entire process. By the end of the year, the first changes should become visible
and noticeable for the public.
We are at the stage of building the foundation of
reforms. But I am not content with the pace, just like everyone. And I am doing
everything the President can do in conditions of the parliamentary-presidential
republic to speed up the processes.
***
What bothers me personally the most and what is the
most annoying factor for the society is corruption and fight against it.
What do we have in assets except firm political will?
We are actively creating the legislative base and building the infrastructure
of struggle against corruption. The key thing is unprecedentedly open selection
and appointment of Director of the National Anti-Corruption Bureau. Independent
commission has been choosing among about 170 candidates. Now, they are
transparently looking for detectives on the same competition basis. Such a
meticulous selection requires time. The first detectives will be appointed in
June and the Bureau will start full investigation in October.
We have adopted a European law on public prosecution
and a new Prosecutor General has turned out to be much more efficient than his
predecessors. By the way, there will be job cuts in the public prosecution and
new local prosecutors and their deputies will be appointed on the competition
basis.
New patrol service in Kyiv should put an end to
legendary bribes on the roads in a few weeks. Eka
Zguladze is dealing with the establishment of this
patrol service. We have begun the adoption of laws that regulate the reform of
the Ministry of the Interior, separate power structures from political
structures, establish municipal guard and new police. By the way, I want its
future head to be a person similar to Eka Zguladze, pure, without any corrupt
ties, determined to implement reforms. Although, it is an issue of the
Parliament and Government.
In the framework of my strategy on the involvement of
foreign experts, we have appointed a lot of foreign specialists with successful
experience of struggle against corruption to the management positions in the
Anti-Corruption Bureau, Prosecutor General’s Office, and Ministry of the
Interior. And it is not the only advantage of foreigners. Absence of corrupt
ties in Ukrainian political and business elite will guarantee that they will
work regardless of personalities.
Escalators, which have been transporting loads of
money up for several decades, have been stopped and dismantled.
Loud corruption scandals have become a positive
phenomenon though it sounds as a paradox. It is a catharsis, an evidence that
corruption is no longer ignored. A real struggle against it begins. Press and
society have become much less tolerant to it.
Resignations because of such scandals are a step
forward compared to previous times, but they are clearly insufficient for
current times. We have learned to detect corrupt officials and direct
spotlights on them, but criminal penalties, unfortunately, have not yet become
inevitable. Cases either lie in the courts or fall apart on the way to the
courts.
Judicial reform is the most difficult. And, according
to the law "On Ensuring the Right to a Fair Trial", new rules for
selection of judges have been introduced. The Supreme Council of Justice has
finally been formed under transparent rules. It will decisively update the
judiciary. This month, the Supreme Council of Justice will finally solve the
issue on the dismissal of more than 300 judges, which has not been considered
yet. Most of these dismissals concern proven accusations of corruption.
Another problem is that certain positive changes stay
on the top and the lower we go the less real changes we see. A great share of
bribes is located in the middle part. Their sums grow up given the extra fee
for danger. On one hand it is good that corruption is now perceived as an
extremely risky operation, but life has not become easier for business. Most of
the people do not communicate personally with the President, Prime Minister,
ministers or even people’s deputies. The image of the state in the eyes of the
ordinary citizens is formed by tax officers and customs officers, social
protection inspectors, local judges, police officers and even district
hospitals. People will not trust in the sincerity of our anti-corruption
intentions until these officials take bribes.
I’d like to demonstrate the first light rays in the
sphere of public procurement. People keep on stealing money, but there is
certain progress already. Shadow paybacks have been decreased significantly, a
lot of schemes have been ruined. It has become much more transparent. People
have started controlling everything closer. Each tender procedure (25,000 per
year) transforms into hundreds of various papers and documents. Nobody can
understand nothing there! The first experience of subthreshold procurement has
saved 20%. By the way, the Ministry of Defense and “Ukroboronprom” are the most
active institutions implementing subthreshold procurement. The state-corporate
group has saved more than UAH 130 million, which will be directed to the
state's economy and the maintenance of the army.
Electronic procurement is one of the main targets in
reforming the public procurement sector - both subthreshold and overthreshold.
It is one of the most important tasks of 2015-2016.
Unfortunately, corruption is not only a problem of the
state apparatus... A survey conducted last year by the fund "Democratic
initiatives" regarding the provision of administrative services showed
that bribes in most cases are triggered not by officials, but by applicants.
29% said that they “give” bribes because "it's easier to solve
problems" and every fifth Ukrainian considers bribes normal.
And this rule applies not only to the relations with
the state, but also to the processes within the business environment. 24% of
employees of large companies surveyed by the international consulting company
Ernst & Young believe that strict adherence to the anti-corruption policy
will reduce the competitiveness of their business. And 20% admitted that they
considered intentional distortion of financial performance justified if it was
necessary for the survival of enterprises and their understanding of economics.
A year ago, saying it in this room, I announced the
anti-corruption pact between society and the government: officials do not take,
people do not give. I can now state - both parties do not comply with this
pact. Realizing that the authorities bear much greater responsibility, I ask
the society to help us fight against this scourge.
To receive proper response, we should soon adopt a law
that increases the protection of witnesses, introduces the so-called deal with
the investigation when corrupt officials of lower level have an opportunity to
commute the sentence by helping expose higher corrupt officials. And I am
starting to think about the necessity of "provocation of bribes".
This is when specially trained and motivated people under the guise of
applicants check every official’s tendency to take bribes. The tool is
considered controversial by many people, but it will clearly increase pressure
on corrupt officials: the very fact that people know that a bribe could be
provoked will eliminate the desire to take risks in some people.
***
However, repression is only one of the ways to combat
corruption. And it is not the main one. Economic method, which means elimination
of reasons for corruption, is much more efficient. Corruption has decreased
where deregulation has been held and contactless communication with the state
has been introduced. Where certificates, permits, coordination and conclusions
have been revoked - in other words, where there is nothing to demand money for.
The most recent example of proper decision: the
Ministry of Economy has recently excluded from the list of goods subject to
certification in Ukraine a number of imported goods - from cars and tractors to
children's carts and porcelain ware. In truth, certification has not been held
before as well, because people have been taking bribes. And now they will not
do so, because there is no reason.
The Government has approved the Action Plan for deregulation
of economic activities and simplification of the regulatory framework, which
includes a list of 176 specific measures and mechanisms of their
implementation. I fully approve this strategy. But I am not content with the
slow pace of movement. We must speed it up. Significant relief has not been
felt yet. And we need concrete results as oxygen.
"Every rule has its value," Margaret
Thatcher wrote in her book "The Art of State Governance". The fewer
rules we have, the fewer bribes we have. This is the economic and deep
philosophical meaning of deregulation.
***
One of the main sources of corruption are the
state-owned enterprises. We are moving towards competitive selection of their
heads: this year, at least 20 directors from the list of 50 largest enterprises
will be appointed under the following procedure.
However, a ban on privatization creates immunity for
the authors of corruption schemes in the inefficient public sector. These
factories and plants bring nothing but losses to the budget. And there are only
few exceptions. Their management is usually privatized together with financial
flows. This is what is called a shadow privatization that has already taken
place. Occasionally a life and death struggle is waged between political forces
for the positions of directors of factories.
It is clear that the history of Ukrainian
privatization cannot be read without bromine, as Vynnychenko would have said.
But we have two extraordinary occasions that can become an example of fair and
transparent privatization: sale of “Kryvorizhstal” in 2005 and 3G tender in
2015. Yesterday I had a meeting with heads of the enterprises that had invested
UAH 11 billion in Ukraine at this contest. They are the best promoters of
Ukraine at every international meeting. They say that the form of distributing
3G licenses was fair and transparent. For Ukraine has been left behind in the
past century in terms of telecommunications and those who were trying to
obstruct this contest were waiting for a big bribe. By the way, over a half of
users will be connected to 3G in several years. In 2017, we will have the same
transparent contest for 4G.
Of course, I stand for the tight control of Parliament
over privatization. The more transparent it will be done, the better it will
be. I support the idea that you, dear MPs, will set the rules for its
implementation and the list of objects for implementation. There are 1,800
state-owned companies left. No more than 200 are vital for the state. Of
course, we will not sell "Ukrzaliznytsia" or defense companies, but
who can explain me why the state needs 14 stud farms, which are also prohibited
for privatization?
Last week in Kyiv, Leszek Balcerowicz called
privatization one of the main efficient economic reforms, just as stabilization
of energy sector. Didn’t Poland start its way to success from the spheres for
which we are now mostly criticized?
Eventually, in two decades most of the companies
included in the list of prohibited for privatization received no investments in
fixed assets and are doomed to lose the competition. Equipment and technology
are at the level of 1930s. They will not survive unless they receive effective
direct investments and effective management from both domestic and foreign
investors. By the way, let us together ask Russian companies not to participate
in this process!
***
Along with deregulation and privatization, another
element of our anti-corruption strategy is deoligarchization. But it is not
limited to this. Metropolitan and prominent public figure Andrey Sheptytsky
wrote in his book-guideline "How to build a native house":
"Tyranny is more dangerous than corrupt aristocracy or oligarchy, but it
is again worse and more dangerous than democracy".
Any scientist who investigates the typology of
political regimes says that the so-called competitive oligarchy is really
better than authoritarianism and is a transitional step towards liberal
democracy. Some countries have spent tens and hundreds of years for a similar
transit. But we do not have much time! And we must act immediately. I would
like to make clear that it is a war not against individuals, but against the
system.
What does the state do? Our significant actions are
the law on the so-called 50+1 share, law on gas market, NSDC decision on energy
and coal market. “Forbes” stars will no longer be lit with opaque gas fumes. We
will no longer feed coal and steel barons with coal subsidies from the budget.
Ukraine will have a controlling stake not on paper, but in reality.
What do I get in return for such policy? The clank of
weapons of private armies camouflaged as miners, provocation of rolling
blackouts, closing of factories, terrible black PR.
Everyone subject to deoligarchization has a nationwide
TV channel and strikes me with all information “Grads”. Almost all of them have
their loyal and dependent political project with which they are planning to
create a calm prospect for themselves and a terrible future for Ukraine.
Will this resistance stop me? No! Course towards
deoligarchization will be continued whatever it costs me. For Ukraine will not
survive in this battle without winning it.
Private business should manage only its own companies,
it shouldn’t use public companies and budgetary flows. Yes, the government
should engage in dialogue with large businesses, because they create jobs. But
business has no right to speak with the state in the language of ultimatums.
By the way, one of the most important decisions within
deoligarchization and democratization should be the transition to the budget
financing of political parties. And no matter how hard it may be, these charges
are the priority, for the independence of democratic forces is a key element of
democracy in Ukraine.
Last year I personally financed my presidential
campaign. Expenditures of my political force in the parliamentary elections
also had a transparent source. I am fully independent. I have obligations only
to the Ukrainian people. It is nice to be independent when making decisions. Others
cannot have such independence due to the absence of budget funding no matter
what patriotic flags they wear. Parties and factions have to depend only on
voters and budget funding is a step towards this goal. It is not a coincidence
that this condition is embedded in the anti-corruption package that we have to
adopt within the visa-free regime and I expect the Parliament to support this
initiative.
***
An integral part of deoligarchization is
demonopolization, because monopolies parasitizing on state resources are the
economic basis of oligarchy. Losses caused by cartel collusions in Ukraine are
estimated at between 10 and 22% of GDP. Up to 40% of goods and services are
sold in monopolized markets. It kills the incentive to achieve efficiency,
lower prices, modernize and improve product quality.
We had to begin with cleaning the Antimonopoly
Committee, which has been monopolized by monopolists until recently, sorry my
tautology. 80% of thermal generation belong to one person and committee
officials say there is no monopoly.
Yesterday, at the National Council of Reforms, I gave
instructions to the newly appointed Head of the Antimonopoly Committee to apply
the best international antitrust practice. I will act as decisively as Theodore
Roosevelt a century ago when he stopped the abuse oligarchs and returned
economic competition to the United States.
We must make a political decision and limit the
maximum share in certain markets to 50%, and in the most important ones – to
30%. With these new rules, we will split monopolies. They will have to choose:
obey state regulation, or sell part of their presence.
***
Free competitive entrepreneurship should be the basis
of our economic model. I would like the tax reform, which is currently being
discussed in the Government and Parliament, to meet this vision. Previous
governments traditionally considered taxes only in terms of fiscal functions. I
am confident that we need to use a catalytic component of taxes.
I should not intervene in economic processes, because
it is a prerogative of the Government and coalition in our
parliamentary-presidential model. However, education and experience dictate a
professional look at the logic of economic processes. To sufficiently increase
national wealth and ensure high economic growth, we need, above all, economic
freedom and non-restrained energy of Ukrainian entrepreneurship. There is
nothing to divide, but there is something to multiply. It is not a suitable
moment for social democracy, Thatcherism and Reaganomics will be more useful
now.
There are grounds for cautious hope that our economy
has already experienced the most difficult period. I pray for this year in the
history of Ukraine to be the most difficult. For peace and reforms to come to
our land. For economic growth to come. And if we manage to avoid a full-scale
invasion and keep the peace process, postwar reconstruction of the country will
begin next year. Economic growth will be resumed and, consequently, there will
be resources to remove the most acute social problems, pay due attention to
education, science, culture and health care.
We've got a little extra revenue in the budget -
partly of inflationary origin, partly due to legalization. I would like the
government to accelerate consideration of inflation and possible indexation of
wages and pensions for at least a few months. One must do it carefully,
avoiding any populist steps in order to prevent the hyperinflation and
destabilization of the financial and economic situation in the country. One
must also take into account the fact that some additional income will be spent
for the Ukrainian defense.
One should fulfill all the requirements of the law on
termination of accrual of any special pensions from June 1, 2015 for MPs,
ministers, judges, prosecutors, customs officers, etc.
One should also adopt a law on unified principles of
pensions’ accrual as soon as possible. It has not been done for 23 years.
Finally, we must give an opportunity for people to use not only PAYG pension
system, but also defined contribution pension system. They should also have an
opportunity to use the services of private pension funds.
By the way, I’d like to remind you that in a hard
dialogue with the IMF we have managed to withdraw their request to raise the
retirement age, despite the fact that it is a global trend.
Speaking of the most acute social problems I cannot
ignore the topic of tariffs. It is one of the most difficult and painful
reforms. Probably the most difficult. We’ve made extremely difficult and
strategically right decisions. We will not return to the unprecedented
situation with corruption in the gas sphere, to the deficit of the NJSC
Naftogaz, which exceeded UAH 130 billion and was reimbursed at the cost of
taxpayers. We must speak of that today. This is the price, Ukrainian taxpayers
paid for the lack of transparency in the formation of tariffs. They’ve been
subsidized and it has been an additional state debt, which has been leading
Ukraine to the default. This deficit has been reduced significantly in 2015. I
hope that it will amount to UAH 30-35 billion this year.
We should remember that among all options of changing
the obsolete tariff system discussed with the IMF, we managed to defend the
least hard option, because the previous requirements were significantly more
risky for Ukraine and Ukrainian people. It would be even softer if previous
governments hadn’t delay a solution to this problem and had not cheat the IMF
with their empty promises. Unfortunately or fortunately, we did it.
The main thing we have to do now before the beginning
of the heating season is to provide targeted, very simple and very reliable
protection mechanism for the poor through subsidies. For those who have little
money and low consumption, growth of rates should be invisible. The money they
spend should be the same. After a radical reform of the system of subsidies,
the right to such assistance from the state cannot be limited by anything.
Local authorities should ensure subsidies for all Ukrainian families in need,
no matter how many of them will apply.
In order to improve the system of subsidies and bring
it into full compliance with the best international practices and standards, we
will attract one of the world's most famous consulting companies, which should
significantly simplify the mechanism of access to subsidies - it should be
automatic by September. The system of formation of tariffs will also be
reviewed by several most respected international auditors. I urge politicians
not to hold discussions at TV shows, but to join the work of these companies
with specific proposals on the verification of rules on the formation of
tariffs.
I would like to offer a few more steps that will
better protect the poor. We will never subsidize suburban palaces with gas and
electricity prices similar to that of the rural huts! We will simplify and
increase subsidies primarily for villagers living in rural private houses. I'm
going to introduce a bill on full disclosure of tariff formation. We have
nothing to hide. This information is completely available and should be
transparent and understandable for everyone.
By the heating season, I demand to conduct
actualization of the heat consumption standards for the buildings without heat
meters. For such buildings one should make recalculations based on the actual
duration and temperature of the previous heating season. According to
preliminary calculations, it will move from 10 to 15% of money already paid
last winter to the next year. It is fair and we must do it. This is a real plan
on the protection of people in conditions of severe tariff reform caused by the
memorandum with the IMF.
For my part, it would be extremely irresponsible to
resort to various radical-populist steps that are usually explained by
traditional love to the Motherland and nation, but as a result negatively
affect ordinary people.
Decommunization is not only a demolition of monuments.
First of all, communism must be removed from the heads. But unfortunately I see
a lot of people in this hall willing to use leftist slogans of the dead
Communist Party of Ukraine.
***
As for political priorities - the key is
democratization and decentralization. We have not only preserved Ukraine, we
have kept it democratic during the war, although the restriction of rights and
freedoms was fully justified by the martial law. But despite political pressure
from all sides, despite the fact that the legal regime of martial law would
assign much more power to me personally, I could not resort to it. I knew that
its implementation will be a shocking test for my compatriots. Martial law
allows censorship, banning of parties, restrictions on movement in the country,
curfew, general mobilization and confiscation of property and money for the
needs of defense.
We cherish democracy, because we believe in it,
because it is our value. Ukraine can only exist as democracy, otherwise we will
not exist, because authoritarian Ukraine will remain without support in the
world, lose one of the key differences from Russia and eventually become its
prey.
That's why I stay on the platform of
parliamentary-presidential republic and will become the first President who
doesn’t gather powers for himself, but divides them with communities within the
strategic course of decentralization.
Since the beginning of 2015, we have strengthened the
financial base of local government. The city budgets have grown by an average
of 30% already. And this money is freely available, not as before, when one had
to wrest them of the State Treasury.
I hope that the Constitutional Commission is about to
complete the draft amendments to the law on decentralization, and you, dear
MPs, will submit these amendments to the Constitutional Court already at the
current session, for them to be finally approved in autumn. This is my vision
of the calendar of reforms.
Fundamental remarks. Decentralization has nothing to
do with federalization. Ukraine was, is and will remain a unitary state! And
there is a number of issues which will not be affected by decentralization.
Instead, the role of the center will increase in these issues. This applies to
defense, national security, foreign policy, fight against corruption, rule of
law, human rights and freedoms, territorial integrity of Ukraine.
Thus, decentralization could become a reality after
the fall elections of local authorities and local governments. It is amazing that
there are still people who consider postponing the elections valid. It has
already happened in our history, but I guarantee you that it will not happen
again. You will not see this in Europe and the world. The date of voting is set
by the Constitution, everything is very clear. The only thing I expect from
you, my dear partners, dear Parliament, is a new law on local elections with
open lists.
I was asked whether I am conscious of the risks of
local elections. Of course, I am. In some regions Moscow plans to artificially
impregnate pro-Russian projects, in others - on the contrary, encourage
so-called Ukrainian far right movement to frighten Europe with the alleged
Nazism in Ukraine. These plans are stereotyped. A year ago, they hoped that the
plan would work, but now, when we revived the Ukrainian special forces, these
plans are doomed. We will resolutely put an end to the attempts of interfering
in the election process by external forces. The time when the elections will
take place is a golden Ukrainian autumn, not bloody "Russian spring".
***
The new National Security Strategy considers Russian
aggression in all its forms designed to exhaust Ukrainian economy, undermine
social and political stability "in order to destroy the state of Ukraine
and seize its territory" the main threat to the national security. This
threat is like a sharp sword of Damocles hanging over our heads on a
horse-hair. It is obvious, unfortunately, that several generations of
Ukrainians will live in such circumstances.
Having failed to attack from the outside, the enemy
will try to undermine us from within. Everyone forgot that crusade against
Ukraine began with economic aggression: gas blackmail and total repression of
Ukrainian goods in the Russian market. In annual terms, trade fell three times.
It is an unprecedented level of decline. De facto, in addition to the real war
and aggression we have a powerful economic war. Russian aggression drains
Ukrainian economy and affects the quality of our life. The enemy does not hide
its plans to convert the discontent of tired and exhausted Ukrainians into the
destabilization of the situation in our country. Isn’t it strange that
primarily Moscow talks about the "third Kyiv Maidan"?!
At the same time, a huge threat of renovation of
large-scale military action by the Russian terrorist groups remains. 14 Russian
battalion tactical groups of more than 9,000 soldiers are currently in Ukraine.
The concentration of Russian militaries near the state border is one and a half
times higher than a year ago. The so-called "Rosvoyentorg" keeps on
supplying not only ammunition, food, clothing and fuel, but also the newest
armament. A year ago, Moscow promised to "protect" Russian-speaking
Donbas, but actually they turned it into a military test ground for the needs
of the Russian army and tests are conducted on living Ukrainians.
A rifle hanging on the wall will sooner or later go
off. This rule is suitable for the theater of war as well. And given the
well-known topographical cretinism of Russian militaries they can “get lost” at
any moment. Just as it happened yesterday near Maryanka. It is such a historic
parallel that the attack took place at 4 am! Yesterday, Ukrainian troops
decently responded: we informed our international partners, returned the artillery
from the withdrawal line, where it had been located under the Minks agreements,
and rebuffed Russian soldiers. Rebuffed despite the panic spread in the posts
of the “sofas hundred”. Who are your employers? I guess, those who tried to
convene the session of the Federation Council of Russia with the same agenda as
a year ago - permission to use the Armed Forces of the Russian Federation in
Ukraine. I want to calm them down. Russia already cynically uses its troops in
Ukraine having brutally violated the basic principles of the international law.
And these troops have been stopped only by the Ukrainian Armed Forces and the
international solidarity, which has resolutely condemned yesterday’s violation
of the Minsk agreements.
Due to the permanent threat of a full-scale war
against Ukraine, ensuring the defense capacity of the state will remain our key
priority for a long time. No matter how hard it may be, we will again increase
our defense expenditures in the budget for 2016. There is no other way to
protect Ukraine. Why do we have to do this? For today Ukraine is fighting with
weapons of the XX century against Russians armed with weapons of the XXI
century. And our most important task is to re-equip our army.
We have initiated the recovery of high command of the
Armed Forces increasing the ranks of commanders of lower and middle level who
proved themselves during the war.
From patching holes and repairing old equipment we are
gradually moving to modernization, development, improvement and production of
new weapons and military equipment. The development of defense industry, in its
turn, should provide a technological boost for the whole economy.
The difference with the enemy in resources and
potential should not diminish our belief in victory. We should not forget that
David had defeated Goliath. The same will happen to Ukraine.
I’d like to remind that war is not our choice. My
peace plan voiced a year ago in this hall has formed the basis of the Minsk
agreements, which have been accepted by the whole world as the only platform
for the resolution - approved by the UN General Assembly and the UN Security
Council, approved the whole world, including Russia, no matter how cynical it
may sound today.
This plan is very well known, I see no reasons to
repeat it once again. I would like to once again emphasize its three key
components: withdrawal of Russian troops, weapons and equipment from the
territory of Ukraine, establishment of Ukrainian control over the border and
holding of local elections in accordance with the OSCE and European standards,
as well as the Ukrainian legislation aimed at ensuring that we will deal with
representatives of Donbas and not terrorist leaders.
I am confident that the elections will open political
dialogue with legitimately elected representatives of Donbas, stop humanitarian
disaster caused exclusively by Russian occupation and start post-war
reconstruction of infrastructure destroyed by militants. I consider Ukrainian
citizens in the temporarily occupied territories as Ukrainian war prisoners
seized by invaders.
Not only Ukraine, but also our foreign friends are
willing to help this Donbas, as an integral part of Ukraine. But they will
invest money in the restoration of infrastructure only when they make sure that
everything restored today will not be ruined tomorrow by a full-scale Russian
invasion.
If Moscow wanted peace just as Kyiv, Donbas would have
forgotten about this war long ago.
We are committed and ready even today to recover all
economic ties with the temporarily occupied territories of Donetsk and Luhansk,
remove all internal barriers and restrictions towards people and goods. But
under condition of restoring control over the external border as provided for
in the Minsk agreements. If not, one shouldn’t complain about tight control on
the collision line.
For now, Ukrainian humanitarian supplies and pensions
to those who signed up in the territories free from terrorists are the maximum.
Kyiv will not help killers-militants and bandits.
It would be irresponsible before the entire Ukraine
and before the residents of the temporarily occupied territories to help
prolong the power of criminal-terrorist regime. The level of economic ties will
remain the same until the achievement of substantial progress in the
fulfillment of the Minsk agreements.
***
Fellow Ukrainians!
Speaking of war and peace, I cannot but share the pain
which has been the most difficult moment for me in the first year of my
presidency. I wouldn’t wish such pain even to my worst enemy. More than 1,700
Ukrainian soldiers and heroes and over 6,400 civilians ... In military
statistics it is called "unrecoverable losses" and in the heart it is
a thousand of scars. Sometimes it seems as if every soul on the path to heaven
flew through my office, and I talked to each.
War is always accompanied by death. Death is not
always accompanied by war, but war is always in tandem with death - tandem is
such a buzzword in Russia.
Please, let us honor the memory of everyone who died
as a result of Russian aggression against Ukraine with a moment of silence. I
will never forget and never forgive!
It would be surprising if, speaking of security
threats of Ukraine, I didn’t mention the issue of NATO. Russian aggression
inflicted sensitive hit on the myths of Soviet propaganda. Today, according to
opinion polls, the number of people supporting the idea of joining NATO exceeds
the number of opponents for the first time in Ukraine.
At the national level we would have easily won the
referendum on joining the NATO, but there are several "buts" after
the comma sign. Internal: This is not the only issue that still causes
significant differences between the regions. External: many of our friends and
partners in the West are cautious about such fast and fundamental changes in
public opinion and are not inclined to open the door of NATO right now. It is a
truth that I have to finally tell the country without any diplomatic tricks.
We, dear MPs, are not going to look at Moscow in this issue. We will be guided
exclusively by the position of the Ukrainian people, but it will be very difficult
to ignore the opinion of our partners.
Nevertheless, we will defend our interests
persistently. Last year, we removed an item on the neutral status of Ukraine
from the law on principles of foreign and domestic policy. Last month, as I
said, we adopted the National Security Strategy of Ukraine. It seeks NATO
membership and focuses on the standards of the Alliance. All that we are going
to do in the area of security will be unified under the NATO standards.
Our task is to fully achieve all the criteria required
for the accession, and they, incidentally, largely coincide with the criteria
for the EU membership.
The right to make a final decision in this sensitive
and extremely important area belongs exclusively to the Ukrainian people. In a
referendum. But I will not let this issue shake the country, for the unity of
the country is above everything else for us.
***
Fellow Ukrainians and dear people’s deputies!
I’d like to outline a brief summary of our most
important tasks of the year. Continue deoligarchization, deregulation and
decentralization. Start monopolization. Finish creating an effective
infrastructure to combat corruption and go into total joint offensive on it.
Start cleaning the judicial caste.
Ensure economic recovery in the early 2016, complete rehabilitation
of the banking system and implement tax reform. Save single tax for small and
medium businesses.
Pay special attention to the agricultural sphere as
one of the main platforms for the competitiveness of the country in global
markets.
Start indexing wages and pensions already this year.
Polish to perfection a system of targeted subsidies for those citizens who
cannot afford the new rates.
Finally launch the healthcare reform; we cannot
deceive people with fairytales about free medicine.
Further increase expenditures for strengthening the
defense. Militaries should be prepared for the restoration of the enemy’s
offensive in Donbas, and a full-scale invasion along the perimeter of the
border with Russia. We have to be really ready for this. Diplomats should
prevent both of these scenarios, strengthen the international coalition in
support of Ukraine. They must prevent the abolition of sanctions against the
aggressor until the settlement of the situation in Donbas and the return of
Crimea.
Obtain the visa-free regime with the EU in 2016. It is
our common task and responsibility, dear MPs!
I intend to support the program Go Global, which
defines learning English a priority of our development strategy. Ukraine today
is in a global ranking of countries with the lowest level of English, which is
a natural barrier for Ukrainians’ reorientation to Western values and
standards. It limits our access to scientific research, 80% of which are
published in English. 55% of webpages are also in English. The program is
related not only to the young people. English proficiency will become a key
criterion for the admission to civil service. Ukraine is now living in the
centuries of Ukrainian language. 2016 will be declared the year of English in
Ukraine. But the priority of the Ukrainian language is obvious.
I insist on making the final decision on the abolition
of parliamentary immunity and limiting judicial immunity. Please continue the
good trend that you showed yesterday. Caste of untouchables should be
eliminated!
Interim results of the next phase of joint work will
be summarized in autumn. We will review the work of each minister under the
microscope. Implement reformatting of the Cabinet of Ministers is not my
authority. I do not dismiss or appoint government officials and ministers. But
if the coalition doesn’t do it, society may require personnel changes. But my
fundamental position is that changes in the government may occur under the
condition of maintaining current coalition and preserving the unity of this coalition.
In its turn, the unity of the coalition cannot transform into mutual
guarantees.
***
Finally, I would like to draw attention to a small but
indicative detail. Analysis of the National Institute for Strategic Studies was
first handed to you not as a paper ledger, but as a compact flash. This not
only demonstrates concern over the environmental issues, but also symbolizes
transition to e-government.
I have identified this program as one of the most
important in the coming years. Electronic document management, electronic
services and administrative services, electronic tender procurement, electronic
petitions, digital signatures, the widest possible public access to databases
and public registers are like a key that provides new opportunities in the fight
against bureaucracy and corruption. Therefore, the resistance to this reform
exerted by conservative-retrograde forces is huge. But it is vain.
Everyone who tries to counter reforms and prevents
Ukraine from becoming a successful state will lose. I mean oligarchy, corrupted
bureaucracy, country-aggressor and its countless fifth column nourished in
Ukraine by the enemy.
Over the past year I have made sure once again that
we, Ukrainians, are a unique and heroic nation. Few nations of the world can
grade up to our valor and fortitude.
I take my hat off to my native Ukrainian people. To
the strength, endurance and wisdom demonstrated by Ukrainians.
Thank you for that, fellow Ukrainians.
Our country deserves a success. And we will achieve
it!
Glory to Ukraine!
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