Test of survival. Will the Verkhovna Rada carry out the “Koretskyi list”

On Monday, 12 October, the Verkhovna Rada is to convene after an almost month-long break. According to the schedule, sessions were supposed to begin on 13 October, but the government separately asked parliamentarians to come to work at least one day earlier. The reason is the need for urgent votes on bills required to obtain funds from international partners to rescue the empty state budget.

“We gave deputies concrete deadlines. For each required decision there is a date by which the law must be voted on and signed so that we can receive the necessary funds,” said Prime Minister Serhiy Koretskyi. “Our partners have their own procedures for agreeing and allocating funds, and they need time. For Ukraine, that time is now very short.”

In total, the Rada needs to adopt about 40 bills. They did not fall on deputies like snow on the head — most of them have long been brewing in parliament. However, deputies have so far delayed their adoption: both because these decisions are unpopular with the electorate, because of concerns about how they will affect the deputies themselves, and for political reasons.

Prime Minister Koretskyi warned that the situation with public finances was approaching critical back on 14 September. He said Ukraine risks losing a significant portion of the $29,5 billion in planned international financing if parliament does not manage to pass the necessary laws within the set deadlines. At that time the government promised to provide deputies with a separate schedule of deadlines for each vote. At the same time, the Cabinet pledged to accelerate the fulfillment of its part of the commitments (42 decisions) and complete them by 15 October instead of the previously planned 1 November.

According to the session schedule, parliamentary work was to take a break — from 18 September to 13 October. De facto, work stopped as early as 17 September.

Of the total aid package of $29,5 billion that Koretskyi mentioned, decisions have already been made to allocate 3 billion euros under the Ukraine Facility program, and $0,84 billion from the World Bank guaranteed by Canada.

The arithmetic of rescue

Head of the Budget Committee Roksolana Pidlasova said on 26 September that the remaining planned and confirmed external financing is about $25,2 billion. According to her, the next major source from this sum is macro-financial assistance from the EU in an amount equivalent to $4,26 billion. To get it as quickly as possible, the Rada needs to meet four conditions. Three of them are to vote in second reading on the bills on taxation of parcels up to 150 euros and on property valuation (each has more than a thousand amendments), and to pass a resolution to form a competitive commission to select members of the Accounting Chamber.

The fourth condition is a special story. The bill on taxation of digital platforms, which is among the key conditions for receiving international financing, was adopted in full back in June, but it has still not been signed by the president. The reason is an amendment in it that limits mandatory enhanced financial monitoring of PEPs (politically exposed persons) to one year from the moment of dismissal. This is not the first attempt by deputies, some of whom are themselves PEPs, to make life easier for themselves. Unsurprisingly, it again provoked sharp criticism from international partners. Accordingly, the signing of this already adopted bill in its current form is blocked. Pidlasova notes that without revising the amendment on PEPs, one should not count on EU macro-financial assistance.

Head of the Budget Committee Roksolana Pidlasova does not believe that parliament will be able to pass all the bills needed for international financing by the end of the year

source: Viktor Pinchuk Foundation

Of the other $21 billion in financing, Pidlasova says the largest share (almost $13 billion) is expected under the Ukraine Facility program; other sources are the World Bank, the IMF, and EU macro-financial assistance. The signing of the law on taxation of digital platforms determines receipt of $2 billion, and adoption by the Verkhovna Rada of other bills would unlock another $12 billion.

At the same time, the head of the budget committee does not believe it is realistic to pass all the bills that would open access to these funds by year-end. Pessimistic is also the chairman of the financial and tax committee, through which a large portion of these initiatives pass, Danylo Hetmantsev: “I am not sure we will be able to convince all colleagues to support all the decisions and do it on time, but we will do everything possible.”

So already by the end of September the “front of work” that needs to be done was well known in the Verkhovna Rada. But do the deputies have the determination to do what the prime minister, the speaker, and the president are urgently pleading with them to do?

What we will get money for

The bills on the “Koretskyi list” that have deadlines for the Verkhovna Rada can be roughly divided into several categories: international commitments under the Ukraine Facility, IMF requirements, World Bank requirements, conditions for receiving EU macro-financial assistance (EU MFA). Adoption of some closes obligations in several directions at once. For example, the draft law on property valuation is an obligation simultaneously to the IMF, the World Bank and the EU. And the draft on Ukraine’s accession to the Single Euro Payments Area (SEPA) is a requirement of the Ukraine Facility, the IMF, the World Bank, and a recommendation of the European Commission.

A list of 32 bills with deadlines was sent to deputies in advance. Some have already been adopted in first reading, some are only being prepared to go through that procedure. And it is already clear that not all projects with the deadline “by 14 October” will be adopted on time.

Bomb in parcels

According to the plan for the plenary week, on Monday deputies will consider only three “European projects.” They are not very “triggering” for the floor – on occupational safety and health, on basic social assistance, and on increasing the efficiency of privatization of state property. Consideration of the main “money” initiatives is scheduled for Tuesday–Wednesday. These include projects on joining SEPA, property valuation, simplifying administration of value added tax, improving competitive procedures for filling the post of member of the High Qualification Commission of Judges, the second reading of the long-suffering law on parcels, and others.

The parliament will also try to approve at least in first reading the revised draft Anti-Corruption Strategy for 2026–2030, which deputies have not touched for several months. The strategy contains sensitive political innovations demanded by Europeans: obliging the government to draft bills on competitions for the prosecutor general and the head of the State Bureau of Investigation, expanding the autonomy of NABU and SAP, and so on. Even such declarative norms may not find support in the chamber.

“The Anti-Corruption Strategy is on the agenda for the upcoming plenary week, but it is likely that its consideration will be postponed,” says Anastasiia Radina, chair of the parliamentary committee on anti-corruption policy. “There is also a committee bill on the competition to the High Qualification Commission of Judges that was devastatingly criticized by civil society organizations, and there is a government bill on single-judge proceedings in the High Anti-Corruption Court. But there are no other systemic bills on the rule of law and anti-corruption policy on the agenda.”

MP Yuliia Sirko of Holos also points out that the eurointegration cluster “rule of law” is ignored on the agenda. “Servant of the People simply doesn’t have the votes for these bills, so they don’t even try to put them on the agenda,” she explains. “And without adopting the rule-of-law baseline I don’t believe partners will unblock the full amount of funding.”

Perhaps the main intrigue of the week lies in passing in full the parcels law, which deputies had previously spectacularly failed to pass, but nevertheless managed to approve in first reading, and before the second — spammed it with a flood of amendments. And it’s not even about the unpopular provision to cancel VAT exemptions for international parcels worth up to 150 euros (it will not take effect earlier than July next year), but about a more urgent amendment for deputies regarding PEPs that was inserted into this document.

It is meant to fix the scandalous situation with the digital platforms law that the Rada adopted on 9 June. In that law deputies tried to limit enhanced financial monitoring for 12 months after a PEP’s dismissal. That decision provoked sharp resistance from Western partners, which is why the bill was not signed by the president.

The amendment in the parcels bill provides that banks apply enhanced financial monitoring of PEPs for 12 months after their dismissal, and thereafter move from enhanced control to individual risk assessment. But not all parliamentarians are satisfied with this.

SEPA: savings or “draconian” control

Resistance in the chamber may also be triggered by the package of bills on joining SEPA. Its author, deputy chair of the Committee on Finance, Tax and Customs Policy Olha Vasylevska-Smagliuk, assures: SEPA is probably the least threatening and most useful initiative in the entire international package.

“Unlike initiatives that take something out of citizens’ pockets, this one, on the contrary, makes it possible to save significantly,” the deputy assures. “According to our calculations, just in the first year, and thereafter every year, Ukrainians and domestic business will be able to save up to 10 billion UAH just on bank commissions and transactions. Today Ukraine has about eight million refugees who constantly transfer money to their families — for them this will be a direct and significant saving. It will also give a huge advantage to small and medium-sized businesses trying to trade with the EU. Under SEPA the transfer fee will drop to one euro. The same applies to Ukrainian manufacturers who import components from the EU, for example for drones: they will no longer have to wait weeks for a payment to go through a chain of correspondent banks.”

Olha Vasylevska-Smagliuk claims that joining SEPA could save Ukrainians up to 10 billion UAH per year

photo: facebook.com/zeolga96

At the same time Vasylevska-Smagliuk concedes: her colleagues in parliament are afraid to adopt the bill.

“It provides for the creation of a Single Register of bank accounts and safes. Deputies want to avoid this, even though they themselves annually declare their accounts,” lists the bill’s author the deputies’ phobias. “At the same time law enforcement will gain access not to the contents of safes or movements on accounts, but only to information about their existence. Second — a Single Register of ultimate beneficial owners of trusts is created. For owners of ‘blind trusts’ this means the future loss of complete anonymity.”

Among the bonuses that could encourage deputies to support the bill, Vasylevska-Smagliuk highlights raising the threshold for transactions subject to mandatory financial monitoring — from the current 400 thousand UAH to 550 thousand UAH, no increase in fines for non-compliance with financial monitoring, and an international audit of the State Financial Monitoring Service.

In addition, the SEPA bill has become a hostage of internal political games — some deputies, including from the relevant committee, tie its adoption to changing the leadership of the National Bank and the State Financial Monitoring Service.

MP Yuliia Sirko of Holos considers the SEPA initiative practically unpassable and argues that it will painfully hit ordinary Ukrainians rather than deputies: “European requirements provide for “draconian” checks for all citizens when opening accounts, issuing cards and making every payment.”

“And this comes against the backdrop of questions, to put it mildly, about the leadership of the State Financial Monitoring Service and the National Bank. The National Bank turns a blind eye to real schemes, yet requires an ordinary citizen to produce 35 certificates of income to withdraw a thousand hryvnias. Without rebooting the leadership of these institutions, SEPA will simply turn into an additional repressive instrument against honest Ukrainians. Indeed, implementing this instrument makes transactions cheaper, but it considerably complicates banking checks, for example for families where a husband sends money to his wife abroad or vice versa.”

Sirko believes the World Bank could wait on executing this marker until a compromise is found on how to curb excessive powers of financial monitoring.

Opposition skepticism

The single-party majority regularly accuses the opposition of sabotaging eurointegration and “donor” bills — including the faction whose name even implies support for such initiatives. Member of the Finance Committee Nina Yuzhanina of European Solidarity (Poroshenko) claims that during the month-long break in plenary work, no one from the government held negotiations with their faction. The deputy takes the list of urgent bills that the government sent to parliamentarians and comments: “Let’s start with the fact that about 15 of the bills demanded by partners are not even registered in the Verkhovna Rada. If you go through some of those that are registered, the picture is as follows.

The draft law on the National Energy and Utilities Regulatory Commission (NEURC) is not ready. The Customs Code draft for second reading is also not ready; discussion in committee reached only halfway, there are countless amendments. The draft on virtual assets — much work remains ahead, there is not even a final text from the subcommittee yet. Taxation of parcels: here, because of PEP provisions, the chances of adoption are 50 out of 50. Reform of the property valuation system: the text for second reading turned out very complex, chances of adoption are 50 out of 50. Everything will depend on how the sector itself persuades deputies and what it manages to convey to them. We did not discuss the drafts on attracting a strategic foreign investor and the National Securities Commission in committee. The bill on protecting citizens and their funds from illegal actions with payment instruments and bank accounts raises many questions. For example, an attempt to limit handing cards from hand to hand outraged relatives of servicemen. Many wives have their husband’s cards on the front; they withdraw money and buy necessities for fighters. This exception was not properly written, so the fate of the draft is in big question. Accession to SEPA: a very complicated document. For now we are not ready to vote for it.”

A staunch critic of government initiatives, Nina Yuzhanina says a number of projects from the “Koretskyi list” are simply not ready

photo: eurosolidarity.org

At the same time Yuzhanina says her faction could support, in particular, bills on rebooting the governance of the Deposit Guarantee Fund and improving the procedure for disclosure of banking secrecy by the National Bank.

Yuliia Sirko of Holos leans toward the view that, besides SEPA, the main stumbling blocks will be the Anti-Corruption Strategy, which is not supported by groups formed from fragments of OPZZh, Batkivshchyna and part of Servant of the People, and the parcels bill.

“The parcels bill causes huge outrage by itself: it’s unclear why this bill is being pushed now if it will not provide any additional revenues to the budget either this year, or in 2027, or in 2028, ” the deputy wonders. “On the contrary, the state will have to make colossal investments in customs warehouses, procedures and expand the customs staff, who will simply “eat” all the potential income from introducing VAT. And the amendment to restore strict control over PEPs will be tried to be knocked down right during the vote. There is no consensus on this document.”

At the same time Sirko predicts that a realistic scenario by year-end will be fulfilling 60–70% of the partners’ demands.

MP Yuliia Sirko of Holos believes that realistically 60–70% of the partners’ demands will be met by year-end

photo: facebook.com/Klymenko.me

Hungarian ultimatum

Chair of the Foreign Policy Committee and Servant of the People MP Oleksandr Merezhko believes the main conflict in the session hall is between the country’s urgent needs and the political instincts of his colleagues: “For some deputies who dream of being re-elected in their constituencies, it is difficult to vote for unpopular laws that will prevent them from winning future elections. However, we still need to survive until those elections and do everything so that they can take place at all. In my observations, the process will move like this: we convene, manage to vote on some things, fail on others, then convene again and vote again. There is hope that gradually we will ultimately pass all these problematic laws. But it’s a matter of time, and before winter we have very little of it.”

Merezhko separately stresses external force-majeures: the Rada’s work can be disrupted at any moment by prolonged air raid alerts and blackouts in the capital. This could further shift the timelines for considering bills, which deputies are already struggling to meet.

Complicating the session week further could be consideration of bill No. 16119 on ensuring the educational rights of indigenous peoples and persons belonging to national minorities (communities) of Ukraine. It is on the agenda for Monday. It is not part of the package tied to financial assistance, but it directly concerns our eurointegration aspirations.

Hungarian Prime Minister Péter Magyar demands adoption of a law restoring the educational and language rights of the Hungarian minority in Zakarpattia. This is his ultimatum for opening eurointegration clusters for Ukraine

photo: facebook.com/peter.magyar.102

Despite its general title, in parliamentary circles 16119 is directly called the “Hungarian bill.” It was developed to fulfill Budapest’s key demands to lift the blockade on opening eurointegration clusters for Ukraine. The Ministry of Education and Science notes that the draft corresponds to Ukraine’s eurointegration commitments in education, but the ultra-patriotic wing in parliament is concerned that its adoption will significantly weaken the position of the Ukrainian language in Zakarpattia.

Parliamentary defenders of the Russian language also criticize the draft, arguing that adopting the “Hungarian bill” will lead to discrimination against Russian speakers. For example, Servant Maxim Buzhanskyi assures that European Solidarity and Holos will support this decision in exchange for bringing to the floor MP Nataliia Pipa’s bill requiring the use of the Ukrainian language in schools not only during lessons but also during breaks. However, Pipa’s bill is not currently on the agenda.

Pavlo Vuyets, Hlavkom