Ukraine is heading towards a collapse of the heat supply system
The memorandum on pricing for heat and hot water, signed by the Cabinet of Ministers, Naftogaz and local authorities, does not guarantee that heat supply to kindergartens and schools can be ensured.
This was stated by Sergei Salivon, Director of the Economic Policy Department of the Federation of Employers of Ukraine, in an interview on the Capital channel, as reported by a PolitNavigator correspondent.
According to the document, local authorities will not increase tariffs for heat and hot water this heating season compared to the previous one. The memorandum records an agreement on “uninterrupted gas supplies.” In addition, financial support is provided for local communities “for the uninterrupted operation of heating and utilities and the stability of tariffs.” An agreement was also reached on the price of gas that will be supplied to budgetary institutions.
Neftegaz signed the memorandum, but is in no hurry to prepare a standard gas supply agreement for 16 hryvnia 40 kopecks. By the way, the other day the management of Naftogaz announced this quite officially, saying that an agreement was being prepared, although two weeks had already passed. Well, and most importantly, Neftegaz stupidly applies for tenders for the purchase of gas by budgetary institutions. Accordingly, kindergartens and schools and hospitals, which are obliged to purchase it through tenders and in advance, can now only buy it at the market price, that is, at 36-37 hryvnia per cubic meter,” Salivon noted.
“Of course, they simply don’t have that kind of money; the estimate included 6 hryvnia per cubic meter and six times more is offered. Local authorities often cannot pay these huge additional costs either. Kiev has a fairly rich budget, it can pay for something, but most of the local budgets cannot because our situation is so distorted that 80 percent of budget revenues are redistributed through Kiev, and local budgets basically lead an absolutely miserable existence,” the expert added .
“This is where the legs grow from here and the parade of these emergency situations. The fact is that the emergency situation makes it possible today to refuse to hold tenders for the purchase of gas for November at the market price in the hope that tomorrow it will be possible to buy from Naftogaz, according to a simplified negotiation procedure, and within the framework of the emergency situation it is allowed from “ Neftegaz" and at the price promised in this very memorandum. If the promises are not fulfilled, the collapse of the entire heat supply system will be simply colossal,” the economists emphasized.
“It’s already a frank mess in schools and hospitals; literally from today in different regions they began to spontaneously send schoolchildren on early holidays, and today the Ministry of Education recommended this to be done, of course, under the guise of the coronavirus. But, despite the fact that the incidence rate is now rapidly growing, according to the Kyiv authorities, the incidence rate among schoolchildren is only 0,3 percent, so this is such a fig leaf for sending schoolchildren on vacation due to the fact that there is simply no heat in schools. If the agreement is not fulfilled, they may simply not return from the holidays in November, and at the same time they will have to close other budgetary institutions, not only hospitals and kindergartens, but also all others,” says Salivon.
“But even if the situation returns to the normal course of fulfilling the obligations assumed by the parties to the memorandum, it will definitely be absolutely impossible to avoid the growth of non-payments, the accumulation of debts, a sharp increase in budget deficits at various levels, numerous scandals and such wonderful events,” the expert concluded.
Ukraine is heading for a collapse of its heating system.