One of the key types of abuse with damaging consequences for transparency and competitiveness of electoral process is the budget administrative resource. It denotes the use of public funds and means in favour of certain parties or candidates. In fact, such actions can often take place with no formal breaking of the legally established requirements.

Politicians manipulate with the urge of voters and local communities to receive due level of funding for local projects and avoid public responsibility for the de facto campaigning at the expense of tax-payers and the national budget. Today, even the small social economic projects cover large areas, which, on the one hand, enables current people’s deputies and their parties to gain certain potential electoral advantages in the forthcoming elections. On the other hand, though, it makes it impossible to reach a long-term and above all, sustainable effect from public programs and activities.

In order to provide for competitive electoral process, in June 2018, long-term observers of OPORA Civil Network started monitoring activities that could be related to the use of budget resources for indirect campaigning.

Subject Matter and Peculiarities of the Monitoring

As part of the survey, OPORA conducted monitoring and traced possible cases of people’s deputies and political parties using budget resources for early indirect campaigning. In particular, the study focused on the subvention for social economic development of certain territories, resources of the State Fund of Regional Development, and the Road Fund, as well as other budget programs and resources.

However, since the mechanisms of allocating budget resources are not entirely understandable and transparent, and the process is full of political bias and secrecy, while people’s deputies are personally involved into allocation of funds, the key subject of the monitoring was the subvention for social economic development of individual territories.

Subvention is a form of monetary aid to local public authorities to implement the defined goal. This kind of aid is every time planned in the National Budget of Ukraine, while the amount and the list of state subventions could change from year to year. The budget usually provides for the following types of subventions:

  • medical;
  • educational;
  • for the establishment of infrastructure of amalgamated territorial hromadas;
  • to cover the difference between the actual cost of utilities services delivered to population;
  • for implementation of activities aimed at developing health care system in rural areas;
  • for implementation of activities on social economic development of certain areas;
  • for providing high quality state-of-the-art and accessible general secondary education “New Ukrainian School”.

In addition, there is a State Fund for Regional Development that is also actively used as a source of funding for local projects.

Thus, in 2016-2018, Cabinet of Ministers of Ukraine distributed almost UHA 12 bln., in the framework of subvention for social economic development. However, did the money manage to achieve sustainable effect for the well-balanced development of regions?

According to findings of recent research undertaken by OPORA Civil Network, one of the most important challenges of the system of public subventions is efficiency and effectiveness of spending the funds that could provide for sustainable development of the regions. However, with every year, the list of funded projects offers impressive examples of non-systemic or even trifle spending. While in 2016, only 13% of facilities funded by the state made the amount below UAH 50,000. In 2018, there was 37% of such projects. Moreover, compared to 2016, the average size of public subvention has dropped, too. It went down from UAH 660,000 to UAH 386,000 (or by 41.5%).

Thus, the trend has prevailed for several years now of the lack of justified priorities of national development in the context of spending subvention funds. This situation has never been commented by anyone, but the principles of spending public funds are fully in line with the logics of gaining voters’ affection.

The indicators of distributing subventions indicate to the possibility of influential majoritarian deputies to engage funds to their electoral districts but they will not necessarily be used to solve some urgent and relevant problems for sustainable development.

That is why, in order to avoid the misuse of budget resources by people’s deputies and political parties for electoral gains, OPORA observers started a special monitoring focusing on public activities of political subjects that could be related to the use of budget resources for indirect campaigning.

During the monitoring, we used the following methods to collect information:

  1. Personal attendance at public events in the regions.
  2. Analysis of official pages / websites of people’s deputies and parliamentary parties.
  3. Monitoring of content of local media, including television channels.
  4. Analysis of websites /official pages pf local self-government and their officials.
  5. Monitoring of materials of political advertisements, reports of people’s deputies, etc.

The second survey by OPORA Civil Network was conducted from June, 2018 till January, 2019, in all regions of Ukraine, and covered all 198 electoral districts.

Forms and Types of Using Budget Resources

In the period from June, 2018, until January, 2019, observers of Civil Network OPORA recorded 1,506 cases of using budget resources for indirect campaigning in favour of people’s deputies and political parties. In 75.2% (1,132) of recorded cases, the subvention for social economic development of areas was used; in 5.1% (77) of cases – the Road Fund; and in 2.7% (40) – State Fund for Regional Development. On the other hand, in 17% (257) of cases, other budget funds were used, and also, to a lesser extent, medical or educational public programs.

According to monitoring findings, the indirect early campaigning was run mostly by the people’s deputies themselves – 65.2% (983) of cases, in 12.3% (185) – it was used in mass media, in 10.1% (153) of recorded cases – by MP’s assistants, in 8.5% (126) – by local self-government and public authorities, or their officials, while in 3.9% (59) of cases – by representatives of political parties.

In general, one can identify two types of using budget resources for indirect campaigning:  activity in mass media/social media – 46.3% (698), and public events – 42.7% (643). Few cases were also related to official online resources of authorities or the public profiles of their officials – 8.4% (126). In addition, special focus shall be made on cases of PR by people’s deputies in the form of outdoor advertisements and in reports on their performance – 2.6% (39).

Indirect Campaigning During Public Events Organized by Authorities With Possible Use of Budget Resources

Usually, such activities are related to participation in opening ceremonies at the newly built or reconstructed infrastructure facilities (schools, kindergartens, playgrounds, sport facilities, first aid stations, etc.), or to transfer of procured equipment or machinery (furniture sets, multimedia and computer equipment, musical equipment, etc.), or to inspections for the works completion status. In most cases (75.2%), such events were funded by subventions for social economic development of individual areas. OPORA Civil Network recorded the total of 643 cases of this form of public activities.

Thus, on November, 16, 2018, a people’s deputy Oleksandr Suhoniatko (Petro Poroshenko Bloc) visited the Sumy gymnasium No.1 in the city of Sumy. There, he took part in the opening of a shooting range reconstructed at the cost of public subvention for social economic development. At the entrance to the shooting range, there was a plate with a sign that the facility was reconstructed with support of the deputy Suhoniatko O.L.

On November, 23, in the city of Shostka, there was a celebration of the 30th anniversary of the physical training club for children and adolescents Patriot. During the festivity, the assistant of the people’s deputy Ihor Molotko (“Will of the People”) Aliona Shulha presented a certificate for purchase of sports exercise machines and tourist tents. However, funds for the purchase of this equipment were allocated from the subvention for social economic development.

Usually, during such public events, they emphasize that funds for implementation of a project were engaged “with support”, “as initiated by”, “as signed by”, or “as facilitated by” a people’s deputy. In some cases, the MP would stress it, in other cases, this will be done by his team members, representatives of local authorities, or heads of institutions the funding targeted.

Indirect Campaigning in Social Media and Mass Media With Alleged Misuse of Budget Resources

This kind of activity is usually manifested in several forms. Firstly, people’s deputies and/or their team members publish on their social media profiles information on the budget funds attracted with support of the MP to implement a project. Secondly, these would be materials in mass media focusing on the fact that funds for an infrastructure facility were attracted with facilitation of the people’s deputy. Thirdly, these are so called “letters of acknowledgement” usually published on websites of local internet resources, and of civil servants from budget institutions the funds were attracted for with solicitation of the deputy.

Thus, on December, 12, the web-portal “Chernivtsi Promin” posted a story entitled “Chernivtsi Oblast Receives UAH 25 mln. This Year Under Subvention Program due to Radical Party.” The report tells that Bukovina had a working visit of a people’s deputy Vasyl Amelchenko who informed about the regular support of the Radical Party provided to all districts through the subvention program. He stated that “this year, leader of Radical Party managed to win from the Cabinet of Ministers the allocation of over UAH 25 mln. for our land.”

On December, 21, 2018, the website of Odesa regional organization of the Vidrodzhennia party published a report on how the regional council deputy Hennadiy Rubskyi engaged UAH 500,000 to provide computers for first aid stations of Bashtanka amalgamated hromada. According to the deputy, he submitted the request  for implementation of this project to the people’s deputy Artem Ilyuk (Vidrodzhennia), and this money was allocated from the subvention by the people’s deputy.

In general, OPORA observers recorded 698 cases of indirect early campaigning of this type.

Indirect Campaigning with Alleged Use of Budget Resources Engaging Public Authorities and Their Officials

Usually, such activities are implemented in two forms. In some cases, officials take part in public events to open/inspect facilities that engaged funds of public subventions when they emphasize that funds for implementation of the event were attracted due to the “initiative” or “support” of the people’s deputy. Instead, other cases involve publication on local authorities websites some materials that also stress the fact of solicitation of a specific deputy in engaging funds for the infrastructure facility.

Thus, in December, 2018, in Odesa secondary school No.41 there was opening of the stadium. The ceremony was attended by Odesa city mayor Hennadiy Trukhanov, and a people’s deputy of Ukraine Dmytro Holubov (Petro Poroshenko Bloc). Hennadiy Trukhanov announced that the money to repair the stadium was received from the State budget with support of Dmytro Holubov. The deputy also confirmed the fact claiming that he always consulted Odesa city mayor as to where send the money from the national budget, for the sake of their most effective use.

On January, 18, 2019, head of Mena district state administration Valeriy Shchukin posted on Facebook a notice where he expressed gratitude to a people’s deputy Taras Kremen (People’s Front) for taking care of the library and the first aid station of his native village of Husavka in Chernihiv oblast. In particular, the official stated that during his visit to the village, gifts were presented for Husavka library branch: a color jet printer, a multifunctional device (printer, scanner, and a copy machine), and a laptop purchased upon request of the library director at the costs allocated by the deputy. However, in 2018, the subvention was planned for the library in the amount of UAH 30,000, and UAH 40,000 for the first aid station.

Upon the whole, in the period from June, 2018, until January, 2019, 126  cases were recorded of such form of indirect early campaigning. However, it must be noted that according to OPORA estimates, about 39.9% of cases of indirect campaigning took place with formal presence of officials of different levels. With this regard, OPORA Civil Network yet again calls attention of officials of all levels of authorities to the need of mandatory compliance with current legal requirements and international standards during election. The International Code of Conduct for Civil Servants approved by the UN General Assembly in 1996 specifies the peculiarity of participation of civil servants in the political process. This activity shall be implemented in compliance with the laws and administrative provisions, so as not to undermine the trust of the public in their unbiased fulfilment of functions and duties. Public officials have no right to use the funds, property, services, or information for activities not related to their official functions. The document of Copenhagen Meeting of the Conference on the Human Dimension of CSCE also requires from member-states to keep in line with the “clear distinction between the state and political parties, such as that political parties shall not merge with the state.”

Indirect Campaigning on the Part of People’s Deputies in the Form of Outdoor Advertising and in Their Performance Reports

This activity is manifested in several forms: deputies inform on how much budget resources they attracted to the district during their public reporting. They state this information in their printed reports disseminated among their voters, publish this data in local media, and place outdoor advertisements.

On January, 17, 2019, in one of the largest residential neighbourhoods of Bila Tserkva, it was recorded a billboard with information that a people’s deputy Khvycha Meparishvili (People’s Front) facilitated the allocation of UAH 150 mln. for the development of the town in 2018. In particular, it is stated that of this amount, UAH 28 mln. was allocated for road repairs, UAH 20 mln. – for the stadium “Labour Reserves”, and another UHA 20 mln – for heat meters.

On January, 30, a non-faction people’s deputy Vladyslav Holub held a press-conference in Cherkasy where he mentioned, among other things, the funds he engaged for the district in 2018 from the state budget, in the amount of UAH 21 mln. “We managed to target the funds mostly to improve infrastructure in education and health care,” explained the politician. During the event, a published report was presented, with infographics on the use of these funds. Moreover, the deputy’s team disseminate this report around the electoral district.

Indirect Campaigning With the Use of Manipulative Technologies

OPORA Civil Network recorded a series of cases with signs of using unfair technologies by people’s deputies, by their team members, or by political parties. In some cases, budget resources were presented as the own money or the deputy funds. In other cases, subvention money were played off as a prize fund during the sport competition. During such public events, deputies of their team members present gift certificates to purchase equipment for budget-funded facilities and “forget” to mention that it must have probably been purchased not with their private money, but at the cost of the national budget.

On November, 17, as initiated by the people’s deputy Oleksandr Horbunov (People’s Front), the city of Kropyvnytskyi hosted a sport tournament “Sporty City – Healthy Nation.” The competitors were school teams from the city. Finalists and semi-finalists receive funds for procurement of equipment for their school. The team getting the first prize received UAH 200,000, ІІ – 100,000, ІІІ – 50,000, IV – 20,000, other participants received UAH 10,000 each. The prize fund was paid at the expense of subventions from the State Budget of Ukraine. In addition, the event was attended by a leader of the People’s Front Arseniy Yatseniuk, and the Minister for Youth and Sports Ihor Zhdanov.

In December, a wife of the people’s deputy Petro Yurchyshyn (Petro Poroshenko Bloc) Lubov Yurchyshyna visited a school in the village of Shyroka Hreblia in Vinnytsia region that hosted a table tennis tournament. After the event, she presented a certificate to purchase furniture, computer hardware, and a bicycle parking structure. However, the needs have been planned to be covered by a subvention for social economic development in 2018, in the amount of UAH 85,000.

Currently, OPORA observers recorded a small number of cases that could have signs of using unfair technologies. However, in order to provide for equality of rights, conditions, and opportunities to all candidates during the electoral period, it is extremely important to closely stick to legal provisions and avoid the use of budget resources for electoral gains.

Outspread, Party Component, and Themes 

Geography of the Outspread

OPORA Civil Network recorded cases of indirect campaigning with alleged use of budget resources in absolutely all regions of Ukraine. The most of such cases were identified by OPORA observers in Cherkasy (124), Lviv (119), Volyn (109), Rivne (100), Mykolayiv (98), and Poltava (98) region. On the other hand, the fewest of cases were recorded in Zaporizhzhia (20), Donetsk (16), in Kyiv (16), and Luhansk regions (7).

Cases of indirect campaigning were mostly targeting villages – 72%, less frequently they referred to cities – 21%, and townships – only 7% of cases. Upon the whole, according to OPORA estimates, this covered 1,112  various settlements in all regions of Ukraine (one case could refer to several places at a time).

Cases of indirect campaigning with alleged use of budget resources were recorded among 137 majoritarian deputies and 24 parliamentarians elected by party lists. Incidents were recorded in 155 electoral districts which makes 78% of the total number of cases, or 88% of the districts that keep receiving regular subventions from the State budget, according to OPORA estimates.

Party Component

According to monitoring findings, in the period from June, 2018 until January 2019, early indirect campaigning with alleged use of budget resources was most actively run in favour of the following elected representatives: Ihor Huz (People’s Front, Volyn region) – 72 cases, Kostiantyn Ishcheykin (Petro Poroshenko Bloc, Poltava region) – 56, Vasyl Yanitskyi (Petro Poroshenko Bloc, Rivne region) – 46, Oleh Liashko (Radical Party, elected by the party lists) – 41, Oleksandr Dekhtiarchuk (Petro Poroshenko Bloc, Rivne region) – 40, Anton Yatsenko (“Will of the People” group, Cherkasy region) – 38, and Oleh Barna (Petro Poroshenko Bloc, Ternopil region) – 36.

As to the party-listed deputies, in addition to Oleh Liashko, the most active MPs in this respect were: Khvycha Meparishvili (People’s Front) – 21 cases; and Ihor Kononenko (Petro Poroshenko Bloc) – 14 cases.

On a separate note, while for majoritarian deputies activities involving alleged use of budget funds for indirect campaigning are rather typical, engagement of the party listed deputies in such processes is rather new to note. However, such activities of the latter mostly took place within certain territorial electoral districts. Thus, OPORA observers recorded cases of systemic activities of Ihor Kononenko (Petro Poroshenko Bloc) within the electoral district No. 94 in Kyiv oblast, Khvycha Meparishvili (People’s Front) in ED No. 90 in Kyiv oblast, Roman Zastawny (People’s Front) in ED Mo.163 in Ternopil region, Vadym Pidberezniak (People’s Front) in ED No.132 in Mykolayiv region, Oleksandr Horbunov (People’s Front) in the city of Kropyvnytskyi, etc.

Over the monitoring period, OPORA observers recorded alleged cases of misusing budget resources for indirect campaigning among representatives of all parliamentary factions and deputy groups.

The most of such activities were recorded on the part of the people’s deputies who are members of Petro Poroshenko Bloc – 771 cases, and People’s Front – 290 cases. The non-affiliated deputies showed 148 cases, the deputies from the group “Will of the People” – 119 cases, members of group “Vidrodzhennia Party” – 110 cases, deputies of Radical Party of Oleh Liashko – 49 cases.

At the same time, less than 15 cases of using budget funds for indirect campaigning were recorded on the part of the Batkivshchyna AUU (12), Samopomich Union (5), and Opposition Bloc (2).

However, OPORA Civil Network states that in the context of recorded activities, in terms of factions and parliamentary deputy groups, a different number of deputies shall be taken into account, in particular, the majoritarian deputies who are part of these groups in the parliament. In addition, different electoral districts and regions in Ukraine are actually receiving different scope of funding and subventions from the state budget, which consequently can impact the recorded number of cases within the study.

Activities related to alleged misuse of budget resources for indirect campaigning in terms of deputies by factions

Faction/group

Number of deputies targeted with indirect campaigning, recorded cases

Petro Poroshenko Bloc

70

People’s Front

24

Non-affiliated

21

Group “Vidrodzhennia Party”

19

Group “Will of the People”

16

Batkivshchyna AUU

4

Radical Party of Oleh Liashko

4

Opposition Bloc

2

Samopomich Union

1

Themes of cases

For the monitoring, OPORA Civil Network also established the themes focused on budget resources (in terms of allocating 2,124 subventions for social economic development), which have allegedly been used by the deputies for indirect campaigning. In most cases, the themes of events were related with educational establishments – 59.7% (1,268 facilities), much fewer of them pertained to housing utilities services, public amenities, and infrastructure development – 10.7% (227), and medical facilities – 10.6% (225). In 5.8% (124) of cases, the allocated subventions were related to social and cultural field; and it was only 3.5% (74) of cases that they referred to road repairs.

 

In the context of the recorded indirect campaigning, 9.7% (206) of cases referred to the “customary events” to open or install playgrounds and sports grounds.

On November, 21, a servant of Volodymyrets DSA Oleksandr Hreben announced on his page in Facebook that citizens of Zhovkynia village of Volodymyrets district, Rivne region, received a playground worth UAH 140,000 with support of the people’s deputy Vasyl Yanitskyi (Petro Poroshenko Bloc) through obtaining a subvention for social economic development of the region from public budget.

On December, 19 the “Stolychnyi Rehion” (Capital Region) portal posted a feature informing that in the near future a sports ground will be opened in the township of Hlevakha, Vasylkiv district, Kyiv oblast. The story includes a comment from the head of DSA Vladyslav Odynets who expressed gratitude for this sports ground to a deputy Ihor Kononenko. “We are trying to promote and develop different kinds of sport in Vasylkiv area, and we create every possible condition for that. Construction works are possible due to co-funding from the state budget, with support of a deputy of the Supreme Council, head of the regional party organization of Petro Poroshenko Bloc “Solidarity” Ihor Vitaliyovych Kononenko,” emphasized the head of Vasylkiv DSA.

Therefore, the same as the subvention for social economic development, cases with alleged use of budget funds for indirect campaigning referred to absolutely different projects in terms of content and subjects covered: from installing children playgrounds and presenting furniture to schools, to reconstruction and upgrading of hospitals.

However, a significant number (in 2018 – 10,603 facilities/events) and reduction of the average amount of the subvention (as compared to 2016 – by 41.5%) enable systematic use of subvention for social economic development for indirect campaigning.

Conclusions

In the period from June, 2018 – January, 2019, observers of OPORA Civil Network recorded 1,506 cases of using budget resources for indirect campaigning in favour of people’s deputies and political parties.  Most of them referred to subventions for social economic development.

The use of budget resources for indirect campaigning is most often manifested in media /social media – 46.3% (698) and during public events – 42.7% (643). Few cases were also related to official internet resources of authorities, or with to public profiles of their officials – 8.4% (126). Cases of PR by people’s deputies in the form of outdoor advertising and in their performance reports should be separately mentioned – 2.6% (39).

OPORA Civil Network recorded cases of indirect campaigning with alleged use of budget resources in all regions of Ukraine. Most cases were identified by OPORA observers in Cherkasy (124), Lviv (119), Volyn (109), Rivne (100), Mykolayiv (98), and Poltava (98) oblasts. On the other hand, the fewest cases were recorded in Zaporizhzhia (20), Donetsk (16), Kyiv (16), and in Luhansk region (7).

Cases of indirect campaigning with alleged use of budget resources were recorded among 137 majoritarian deputies and 24 MPs elected by party lists. Incidents were recorded within 155 electoral districts which makes 78% of the total number, or 88% of the districts that keep regularly receiving subventions from the State budget, according to OPORA estimates.

The most of such activities were recorded on the part of people’s deputies who are members of Petro Poroshenko Bloc – 771 cases, and People’s Front – 290 cases. The fewest cases of possible use of budget funds for indirect campaigning were recorded on the part of Batkivshchyna AUU (12), Samopomich Union (5), and Opposition Bloc (2).

The most active indirect campaigning was run in favour of the following persons: Ihor Huz (People’s Front, Volyn region) – 72 cases, Kostiantyn Ishcheykin (Petro Poroshenko Bloc, Poltava region) – 56, Vasyl Yanitskyi (Petro Poroshenko Bloc, Rivne region) – 46. Among the party-listed deputies, the most active in this context were: Oleh Liashko (Radical Party) – 46 cases, Khvycha Meparishvili (People’s Front) – 21 cases, and Ihor Kononenko (Petro Poroshenko Bloc) – 14.

At the same time, Civil Network OPORA acknowledges that the process of distribution of subventions for social economic development of individual territories is non-transparent, sporadic, and politically biased. Therefore, OPORA emphasizes yet again the importance of changing the mechanism of distributing state subventions, on the need to enhance transparency and clearness of allocating funds and on compliance with the principles of equality, systemic nature, and prioritized allocation of budget resources between different regions of Ukraine.

Besides, in order to avoid the use of budget resources for indirect campaigning in favour of certain candidates and/or political parties, Civil Network OPORA will further trace public activities that could be related to the use of public funds. Instead, the number of public programs is getting nothing but higher.

In addition, OPORA developed and sent to the Cabinet of Ministers detailed  recommendations that include proposals on how to enhance transparency and equal distribution of subventions for social economic development of individual territories, as well as prevent cases of misusing administrative resources during the 2019 national election. However, these recommendations, the same as recommendations developed by the Auditing Office, failed to be taken into account in the  draft changes to the Resolution of the Cabinet of Ministers of Ukraine “On Introducing Changes to Procedures and Terms for Allocating Subventions from the State Budget to Local Budgets to Implement Activities in Social Economic Development of Individual Territories.” It implies that procedures for distribution of subvention for social and economic needs will further include provisions that enable influential majoritarian deputies and political parties to impact the compiling of lists of items to be funded from the public budget.

This situation can become one of the key threats for competitiveness of elections during the 2019 parliamentary vote. Therefore, OPORA calls on the Cabinet of Ministers to take into account the published recommendations in order to make it impossible to use tax-payers money for de facto indirect campaigning.