Optimisation of State Budget Expenditures in Crisis: the Case of Ukraine

The year of Russia's full-scale invasion of Ukraine proved to be the most difficult for Ukraine since regaining independence in the early 1990s. It was the most difficult in all areas, including the public finance system. The economy contracted rapidly while defense financing needs soared. Social spending was also a government priority for which funding had to be found. In overcoming the devastating consequences of the war and creating conditions for sustainable development of Ukraine, one should rely on a balanced and justified public spending policy.
This research looks at the process of optimizing state spending and the effects of crises on budget management. This work complements prior research efforts on crisis-related public spending optimization. The need for optimizing public expenditures and different strategies in both normal and crisis conditions was investigated by Manliev (2013), Schick (2009), Curristine (2020). D.-K. Kraan (2004), T. Bohdan (2016), and B. Anderson (2021) investigated techniques for optimizing state budget expenditures during a crisis. At the same time, little study has been undertaken on the conflict's influence on optimizing public expenditures.
Much of my research is devoted to mechanisms (including methods, instruments, etc.) for optimizing state budget expenditures during crises. During my study, I realized that methods for optimizing state budget expenditures during crises should be separated into two categories: first, optimizing budget expenditures during wartime, and second, budgetary measures for post-crisis recovery.
The interview was chosen as the data collection approach to fulfill the research goal. This qualitative study is based on nine interviews with professionals in Public Sector Finance. The study period was taken as the time of war in Ukraine from 2014 to 2023.
At the same time, the emphasis is on Russia's full-scale invasion of Ukraine in 2022. In a crisis, attaining better results through optimizing state budget spending is inhibited by various factors, the most important of which is uncertainty. To study the case, Uncertainty theory was used as the conceptual framework.
The study of optimization of state expenditures demonstrated (1) the results under uncertainty and (2) features for optimizing state expenditures under crisis conditions caused by the war in Ukraine. The study reveals ideas about optimizing state expenditures under uncertainty caused by the war, which led to ambiguous results. Therefore, the study complements the debate on optimizing state expenditures under crisis conditions.

Liutyi S. Optimisation of State Budget Expenditures in Crisis: the Case of Ukraine : Master Thesis : 072 Finance, Banking and Insurance / Sviatoslav Liutyi. – Kyiv, 2023. – 75 p.