Public Finance Management at the Subnational Level

About the Project

The objective of the project is to provide a basis for SECO's assessment of the feasibility of a subnational public financial management (PFM) program to strengthen selected Ukrainian cities/urban communities (e.g. Chernivtsi, Lviv, Vinnytsia, Zhytomyr, Khmelnytskyi). The feasibility study aims to evaluate the establishment of a technical assistance program and consider combining it with decentralized budget support.

The first stage of the project included desk research, familiarization with SECO's portfolio, and consultations with local authorities. The second stage involved field research in different cities of Ukraine (e.g., Chernivtsi, Lviv, Vinnytsia, Khmelnytskyi, Zhytomyr, and Kyiv).

Subject of the study:

● For each city (Chernivtsi, Lviv, Vinnytsia, Zhytomyr, Khmelnytsky): what specific PFM objectives of the authorities, which are in line with SECO's objectives, can the program support?● To what extent can PFM reform at the level of urban communities contribute to improved public services, especially in the context of Ukraine's recovery? ● How can a subnational PFM program best support cities in managing public investments? Is the relevance and timeliness of the program confirmed? Is it possible to combine a technical assistance program with decentralized budget support? How and in what timeframe can the decentralized budget be prepared at the initial stage of the technical assistance program? What kind of interaction with the central government will be necessary?● How should decentralized budget support be organized (management, disbursement, linkage/integration with budget support from other donors such as the European Union, key performance indicators, etc.)?