Since the adoption of the "Declaration of the State Sovereignity of Ukraine" 16 July 1990, the Cabinet of Ministers were changed eleven times.

A Resolution of the Verkhovna Rada of the Ukrainian Soviet Socialist Republic dated 28 June 1990 appointed Vitaliy Masol as the Head of the Council of Ministers of the UkrSSR. He was removed from his post 23 October 1990 following the voluntary submission of resignation. Until a new Head of the Council of Ministers was appointed, Vitold Fokin, the Deputy Head of the Council of Ministers and the Head of the State Committee on Economy of the UkrSSR was assigned temporarily as the head of the Council of Ministers.

Soon afterwards, 14 November 1990, he was appointed as the Head of the Council of Ministers of the UkrSSR. According to the Law adopted after the approval of the "Declaration of State Sovereignty of Ukraine", 18 April 1991, V. Fokin was appointed the Prime Minister of Ukraine. His tenure in this post came to an end 1 October 1992, when Verkhovna Rada agreed to the proposal of the President of Ukraine to release him from performing his duties as the Prime Minister.

By a Decree of the President of Ukraine dated 2 October 1992 Valentin Simonenko was entrusted with the task of being the acting Prime Minister of Ukraine.

Leonid Kuchma led the next government of Ukraine 13 October 1992. He remained the Prime Minister till 21 September 1993.

The President of Ukraine Leonid Kravchuk by a Decree dated 27 September 1993 took charge of the Cabinet of Ministers on himself. The same day, 27 September, another Decree of the President of Ukraine "On the Coordination Committee for implementing market reforms and overcoming the economic crisis" bestowed the functions of the Prime Minister on Yukhim Zvyahilskiy. This Cabinet of Ministers of Ukraine, led by the President and the acting Prime Minister, is considered to be the fourth government of Ukraine.

After the extraordinary elections to the 13^th (1^st) Verkhovna Rada of 16 June 1994, a new head of the government was assigned. Once again Vitaliy Masol occupied this post.

During the leave of absence of Vitaliy Masol, a Presidential Decree dated 3 March 1995 appointed Yevhen Marchuk to perform the functions of the Prime Minister in his absence. On 4 April 1995 Vitaliy Masol was dismissed from his post.

Y. Marchuk led the Cabinet of Ministers from 8 June 1995 till 27 May 1996.

28 May 1996 Pavlo Lazarenko was appointed to the post of the Prime Minister of Ukraine. In the event of the adoption of the Constitution of Ukraine 28 June 1996, the Prime Minister of Ukraine and the whole Cabinet of Ministers resigned 5 July 1996, while continuing to perform their duties until the appointment of a new government.

Pavlo Lazarenko led the government for the second time starting from 11 July 1996. During this second term, when Pavlo Lazarenko was ill, the President of Ukraine by a Decree assigned Vasyl Durdinets to perform the duties of the Prime Minister, from 19 June 1997. Following the submission of resignation by P. Lazarenko and its acceptance, 2 July 1997, V. Durdinets was appointed as the acting Prime Minister by a Presidential Decree.

Finally, Valeriy Pustovoitenko was appointed the Prime Minister of Ukraine 16 July 1997. On 30 November 1999, the day of inauguration of the newly elected for the second term President Leonid Kuchma, the Cabinet of Ministers resigned as envisaged by the Constitution.

Victor Yushchenko led the tenth government of Ukraine 22 December 1999. On 26 April 2001, the Verkhovna Rada approved a resolution of no confidence to the Cabinet of Ministers of Ukraine.
On 28 April 2001 the President of Ukraine signed a Decree "On the resignation of the Cabinet of Ministers of Ukraine".

Anatoliy Kinakh led the eleventh government of Ukraine 29 May 2001.

The Governments of Sovereign Ukraine

Peculiarities of the appointment of the tenth Prime Minister of Ukraine

After Leonid Kuchma was re-elected for the second term, the issue of appointing a new Prime Minister came up. At first the candidature of the previous Prime Minister Valeriy Pustovoitenko was proposed.

The history of procedural problems with regard to the appointment of Valeriy Pustovoitenko as the tenth Prime Minister clearly showed the serious differences existing among various political forces and oligarchic groups, who supported Leonid Kuchma during the presidential elections.

As is known, prior to the voting on the candidature of Valeriy Pustovoitenko, the parliamentary deputies did not support voting by names, and only by using cards, as a result of which the former Prime Minister received 296 votes only. This gave his supporters the basis to state that, voting without names and using cards led to a dubious political behavior on part of the deputies of the SDPU (united) and the "Revival of the Regions" factions. On the eve of the voting they announced their support to Valeriy Pustovoitenko, but in the session hall they voted against. The leader of the Peoples Democratic Party Valeriy Pustovoitenko himself expressed similar views.

When Leonid Kuchma proposed the next candidature to the post of the Prime Minister - that of Victor Yushchenko, again there were active debates with regard to the change in the procedure of voting. Following a proposal from the faction "Reforma-Kongres" on 21 December 1999 an issue was included in the agenda "On the procedure of approval of the Verkhovna Rada to the appointment of the Prime Minister of Ukraine". After this issue was put for name voting a couple of times, results showed 188 deputies giving their approval to the inclusion of this issue to the agenda, while 107 were against, 4 abstained and 56 did not vote. Interestingly, this decision could not be passed because of the pro-presidential factions - "Revival of the Regions" (13 did not vote and 1 was against), SDPU (united) (12 did not vote and 1 was against), and the Green Party (7 were absent).

It was understood that, despite the overall euphoria and support to Yushchenko, procedure of voting without names would again lead to the same situation as during the voting for the candidature of Valeriy Pustovoitenko. For this reason at their evening meeting 21 December 1999 with the President, 11 factions and parliamentary groups agreed to again raise the issue of procedure for named voting. After this, when 22 December 1999 the Verkhovna Rada at its plenary session supported the change in the procedure of voting for approving the candidature of the Prime Minister, it was clear that, Victor Yushchenko would be the next Prime Minister of Ukraine.

At the same time, the fact that 296 deputies voted in favor of Yushchenko did not mean that automatically a majority of the same number was created in the parliament. We can only say that the voting marked off the beginning of the formation of real pro-government majority in the parliament, which could be up to 230 deputies, and in the worst case - it could have been no less than 170-190 deputies.

Overall, the 296 deputies, who voted in favor of Victor Yushchenko, can be divided into three groups of politicians. First - those who voted for Yushchenko the reformer to create a pro-government majority in the parliament and consequently, to create a reformist government with a concrete plan of action; second group - to a great extent opponents of Yushchenko. They were convinced that although a possible candidate for the post of the President and a promising politician, yet he is unable to solve the socio-economic problems of Ukraine. He will land up in a fiasco and is likely to lose all his political dividends. The third group of deputies constitutes - political forces in opposition to the President as well as to the concept of liberal reforms. By voting for Yushchenko they chose a lesser evil with the hope that political opposition will not be crushed down in Ukraine.

Political-legal status and the structure of the government

The appointment of Victor Yushchenko to the post of the Prime Minister of Ukraine, the new Ukrainian government, and the launching of a number of principal economic reform initiatives gave the bases for the tenth government to be hailed as "reformist".

Since Soviet times there was a tradition to treat the governments as the households and administrative units under the Administration of the President of Ukraine, than as the main state body in the chain of executive power, as is written in the Constitution. Previous governments, as simple tools for the implementation of the decision of others, were suitable for many of the subjects of the political process. But after the 1999 presidential elections and the situation of default of the economy made us realize that the role and place of the government in the system of state power should be reviewed. The government can be responsible for the state of affairs in the country, only when it has enough powers and areas of authority.

The Verkhovna Rada of Ukraine adopted the Law on Cabinet of Ministers in November 1999. But on 15 December the President vetoed it, at the same time signing three other decrees related to administrative reforms. However, the explanation prepared by the Administration of the President with regard to the veto in many ways ran contrary to those decrees. For that reason the President called back his remarks on the Law on Cabinet of Ministers after two weeks. The Constitution stipulates that the President signs and approves the draft law in case he calls back his veto or comments. And only after that amendments may be made to the bill. On the other hand, had the President have any comments on the draft law, he should have sent it to the parliament. As it stands today, the President has neither signed the Law on Cabinet of Ministers yet, and nor more comments were sent to the Verkhovna Rada during the year 2000. A similar situation has emerged with regard to the laws on oblast and rayon level administrations. Thus, going by the procedures and regulations, parliament cannot make the next step. In fact, the activities of the Cabinet of Ministers is not having any legislative base, as the Constitution only lays out the main framework of the government and not the Cabinet in detail. Apart from that, without this law, it is impossible to implement administrative reforms, the main responsibility for which is entrusted on the Government. In addition, it is also impossible to pass relevant laws regulating the central bodies of executive power and reform of the civil service, and these laws are awaiting their consideration for the past two years.

Another salient feature of the Government, which differentiated it from the previous ones, is its style of functioning. Previous governments were distributive. Their main role was to implement the most effective distribution of the revenue earned from the State Budget. The style of the tenth government can be called managerial. The main task of the Yushchenko Government was to establish universal and common code of conduct in the economic sphere, as well as implementation of this code. Unlike its predecessors, the Yushchenko Government from the very beginning became an active player in Ukrainian politics, that is, it responded to its opponents independently, without appealing to the President for help. At the same time, the government seemingly had the carte blanche to do that but its limits were not determined by anybody. For example, in the humanitarian sphere, where the vested interests of the oligarchic groups are absent, the activeness of the government did not evoke any protest nor complain on part of these groups. But in the fuel and energy sector, conflicts had emerged one after the other and were resolved at the cost of resignation of certain government officials.

It is noteworthy that the Government started administrative reform by changing its own institutions. Until 2000, the Cabinet and its constituent Ministries worked autonomously. At the Government meetings, decisions prepared in advance by the office were approved. On a daily basis, the Prime Minister had to sign hundreds of documents, most of which he could not manage to read.

One of the administrative innovations of the Yushchenko Cabinet was the weekly meeting of the Government Committees. Government Committees are the advisory body for discussions on draft resolutions, decisions and Decrees of the Cabinet as well as that of the President. In total there are
5 such committees: Committee for Defence, Military-Industrial Complex and Law and Order Protection (Chairperson - Victor Yushchenko, Deputy Chairperson - Volodymyr Horbulin), Committee for Economic Development (Chairperson - Yuriy Yehanurov), Committee for Reform of Fuel and Energy Complex (Chairperson - Yulia Tymoshenko), Committee for Reform in the Agricultural Sector, Ecological and Emergency issues (Chairperson - Myhailo Hladiy), Committee for Social and Humanitarian Development (Chairperson - Mykola Zhulynskiy).

An analysis of the personnel that the government is composed of allows us to conclude that there was no unified principle based on which it was formed. Some candidatures represent parties or are with definite political environment, while others were representatives of influential groups of vested interest. We cannot on the whole characterize this government to be a coalition one, at least by the way it was formed, rather this government took the interests of the main parties and groups of deputies in the parliamentary majority into consideration. The problem of appropriate personnel for the Cabinet remained and showed the absence of independent decision making or choice of Victor Yushchenko while forming the Government as well as the inconsistency among certain posts and their authorities. For example, the authority of the First Vice Prime Minister Yuriy Ehanurov was much less than that of the Vice Prime Minister Ms. Yulia Tymoshenko.

The "Reform for Well Being" program of the Government envisaged introducing a new system of organizing the work of the Government and decision making procedures with the participation of the Government Committees. It also envisaged the implementation of measures, which would allow for a detailed and clear division of functions among all levels of management. The program also was aimed at improving the structure of the executive power on the whole at all levels and reform of the civil service. Unfortunately, the year 2000 did not become the year of structural changes in the administrative system. Administrative reform, which was started actively with the unification of various ministries and redistribution of functions and authority, did not have its continuation at oblast and rayon levels.

Evaluation of the Yushchenko Government

Government Activities in the Economic Field

Creation of a mechanism to resolve economic problems was one of the priorities underlined in the "Reform for Well Being" program of the Government, which was worked out at the beginning of 2000. 261 parliamentary deputies overwhelmingly supported this program 6 April 2000. The program was aimed at strengthening the statehood, raising the living standards and well being of the people, improving the moral and psychological atmosphere in Ukraine, and diminishing social tension and democratic transformation. New approaches were proposed in the program for sustainable development of the Ukrainian economy. Based on extended economic freedom of individuals and entities and fully utilization of the potential of the regions of Ukraine, this approach united in itself the policy of structural changes, economic growth with a pro-active social policy for the state. The year 2000 was the first year of economic revival for Ukraine, which showed positive results for most of the sectors of the economy. Gross Domestic Product - is the most important indicator in the system of national accounts. According to the data of the State Committee for Statistics, real GDP rose by 6%, and this was a positive factor.

It is evident that the growth of GDP was possible thanks to the renewal of production in industries. Total industrial production rose by 12.9%, and in some sectors of industry it even was more than 20%.

The main important feature of the GDP growth is its stability, that is, not great fluctuations but a rhythmic upward trend in course of the whole year. Apart from internal factor there were external factors which facilitated such stable trend. First were the favorable conditions of trade in the world market. Due to the fact that countries which are the major importers of Ukrainian goods underwent economic boom. Ukraine therefore had the chance of increasing its exports to these traditional markets - that of Russia and the European Union.

Structural changes in the Ukrainian industries, going on since 1993, are characterized by a growing ratio of those heavy industry sectors, orientated towards export (energy, fuel and ferrous metallurgy) and a sharp decrease in the share of machine building and light industries. The heavy industry sectors mentioned above accounted for 63% of the total industrial output in 2000. Among the basic sectors of industries in Ukraine, the share of ferrous metallurgy is steadily rising (28.2%), in 2000 55.9 and 2.7 million tonnes respectively of iron and manganese ores were produced, and iron and steel production amounted to 25.7 and 31.8 million tonnes.

In 2000, enterprises of non-ferrous metallurgy showed 2-3 times increase in production of aluminium, brass, copper, nickel and titanic. In chemical and petrochemical industries a 5% growth was witnessed in 2000 compared to that of the previous year.

However, negative trends were also there. Electrical energy production was 2.9% less in 2000 than its 1999 level and equaled 169 billion kW/h including 77 billion kW/h - by atomic power stations, 81 billion kW/h - by thermal and 11 billion kW/h - by hydro electric power stations. Production of electricity increased by 7.3% in comparison with the previous year's level only at atomic power stations.

Negative trend persisted in the fuel industry during the past few years. In 2000, the decline amounted to 4.1%. This is accounted for, first and foremost by the significant decrease in production in the petrol-refining sector.

Unlike in the previous year, in machine building and metal-processing there was a monthly rise in production during the course of 2000, resulting to a annual increase of 16,8% of production. Production increased in all enterprises of the machine building sector, the biggest increase was in the automobile manufacturing (by 61%), aviation (52%), shipbuilding (42%) and electrico-tecnical (by 41%) industries. Together with this, production decreased in mining and mineral (by 10%), chemical and petrol (by 2,2%) machine building.

Timber processing, cellulose and paper manufacturing enterprises witnessed the highest level of annual growth - 37,1%.

Growth rate of light industry in 2000 constituted 39.0% vis-a-vis 5.7% in 1999. During 2000, significant increase in production was seen in food processing - the most attractive sector for investment. The rate of increase in this sector was 26.1% of its 1999 level and 111.1% of its 1995 level. In 2000, it also became possible to stop the long-drawn decline in production of the agrarian sector. For the first time in ten years economic growth was observed in agriculture. Total agricultural output (in comparative prices) went up and stood at 7.6% of its 1999 level. It is necessary to point out that, in agricultural enterprises of all forms of ownership it went down by 8.8%, but in private individual land plots it grew by 18.9%. Agricultural enterprises, created on the bases of the former collective farms (Kolhosp) decreased their production by 6%.

Another important development of 2000 was the unprecedented growth in the rate of capital investment, which increased by 11.2% of that of 1999. Together with investment, consumption also rose. Retail trade turnover grew by 6.9%. In addition to growth in investment and consumption, the financial sector also was stabilized. Real revenue in the State Budget increased by 38.9% in 2000. Since the attainment of independence by Ukraine, budget deficits became usual (1992 - 10.8%; 1993 - 6.9%; 1994 - 9.3%; 1995 - 6.8%; 1996 - 4.9%; 1997 - 6.8%), only in 2000 there was a budget surplus of 0.7% of GDP.

Economic growth, budget surplus and the positive balance in foreign trade shows the level of macroeconomic stabilization achived by Ukraine. Thanks to these gains, the Government could start servicing and paying off the foreign debt without external financial support and fulfil its obligations. For the first time since 1995, the level of foreign debt decreased, including that to the IMF.

It is also important to note that the exchange rate for the national currency Hryvnia during the course of the whole year remained stable. This was maintained exclusively by economic means, by continuing the policy of cheap credits from banks by lowering interest rates of the National Bank of Ukraine. This helped the commercial banks to increase their credits to the various sectors of the economy by 62% from the beginning of the year.

In 2000, inflation was the highest in January (4.6%), and this is also the highest since October 1998. Price increases in food and services mainly influenced the consumer price index (5.5% and 5.4% respectively). From December 1999 to December 2000, rate of inflation stood at 25.8% which is higher than the same period of 1998-1999 (19.2%). Consumer price index in 2000 was 125.8%, with a monthly increase in prices of - 1.9%. In 2000, prices of food items and services increased 3.5 and 3.2 times respectively of that of non-food items. In 1999 prices for food items increased by 26.2%, while prices for services and non-food items remained almost the same (11.9% and 10.6%).

During 2000, 5351 entities were privatized, of which 1733 - were state owned and 3618 - communal properties. Enterprises that are of strategic importance for the security of Ukraine were put forth for privatization. The State Budget earned 2075.3 million Hryvnias in revenue as a result of privatization of state owned enterprises, which constitutes 80.6% of the annual target.

Foreign direct investments into the Ukrainian economy in 2000 reached 595 million US Dollars, which is 20% more than its 1999 level. This level of foreign direct investments was reached by privatizing state owned enterprises.

So far as foreign trade is concerned, it was increased and got a revival after the crisis period of 1998-1999. In 2000, foreign trade of Ukraine totaled 33.4 billion US Dollars, export of goods increased by 3.26 billion US Dollars or by 26% and totaled 15 billion 722 million US Dollars. Export of all categories of goods increased, with significant increase noted in chemical and realted sectors (1.5 times), as well as export of non-precious metals and goods manufactured out of those metals (1.4 times), and minerals (by 19.1%) etc. As was already mentioned earlier, the main factor behind the growth of exports was the favorable conditions in the world market for traditional items of export from Ukraine. In particular metallurgy and chemical industry outputs were in special demand. Export of hi-tech items with a high level of value added. Export of machines and their spare parts rose by 47.5%, mechanical machines by 39%, electrical machines by 49.5%, land transport items, except railways increased by 1.6 times and locomotives by 3.3% etc.

Imports rose by 2.88 billion US Dollars and totaled 18.12 billion US Dollars in 2000 and this increase covered all items. The only import that decreased was that of livestock and products of animal husbandry, food products and means of transport. Import of raw materials dominated: mineral fuel, petrol and its by-products imports constituted 43%.

According to experts of the Institute of Politics, several factors could be underscored while evaluating the economic performance of the Yushchenko Government. Firstly, the firm fiscal discipline, and financial discipline in the economic operations led to restriction and gradual decrease of barter as a form of compensation or payment for the production of commodities and transfer the mode of payment to money alone.

Secondly, it was important to hold the gears of inflation under control and within the framework of the expected forecasts. Thirdly, absence of external financing or loans allowed for "disciplinizing" the Government. For the 10 months of 2000, foreign debt decreased by 2.5 billion US Dollars and considering the record of last year's economic progress, the trend towards decreasing foreign debt will continue and be a characteristic feature of the economic development of Ukraine in the nearest future.

One of the positive signs of economic improvement is the timely approval of the State Budgets for 2000 and 2001, which were without deficit.

Consistent measures in the fuel and energy sector during the course of the year allows us to speak of active reform of this sphere, and substantial decrease in the influence and weakening of the position of financial-oligarchic groups in this area. An outcome of bringing order into this energy sector, attempts to diversify it is some decline in the production of energy by thermal and hydroelectric power stations and certain increase in the production of energy by atomic power stations. The State Committee of Statistics of Ukraine has recorded this.

Last aear's experience showed that the Government was able to implement the Program of reorganization of the sector. First of all, it created transparent, competitive and effective markets of energy, a much needed measure for improving and increasing the production of domestic coal, natural gas, petrol, electrical energy, in order to support the economic independence of Ukraine in terms of not depending on other states for energy supply.

Government Activities in the Social Sector

The Government led by Victor Yushchenko was capable of having significant gains in the social sector, especially in reducing the pension and social payments arrears. The 2001 State Budget has allocated substantial costs to the development of the social sector, and in this sense, this budget is the most socially orientated of all other budgets since the years of independence of Ukraine.

According to the data of the State Statistics Committee, pensions and social payments arrears did not emerge again in the following months after all arrears were paid off by the Ministry of Finance and the Pension Fund during September 2000. A Cabinet of Ministers Resolution No. 1370 "On the advancement of the Social Sector", approved September 2000, laid down the major directions of social policy till the year 2004. The measures envisaged in this resolution cover a wide range of areas, in particular, population development, reduction of hidden unemployment, improvement of labor relations, pension and social protection reform, creation of a modern system of social insurance, enhanced targeted support to the most vulnerable groups.

Another priority of the Government in the social sector is the already started work on pension reform, aimed at resolving the issue of social justice, creating an universal mandatory state pension as well as voluntary pension system at the expense of individual pension deposits. This would serve as a huge investment resource, which would cater to the financing of development of the economy and increasing the level of pensions. In order to enhance the purchasing power of the pensioners, a Cabinet Resolution "On increasing the pension level and other forms of social payments" was adopted, according to which as of 1 December 2000, pensions, as determined by the Law on Pensions, were raised. Expenditure for this amounts to 105 million Hryvnias per month.

A draft three tier pension system is under formulation, according to which, the first level will signify the introduction of "solidary system" (depending on the level of salary and the total years of work experience), the second level will mean - compulsory accumulation and the third - voluntary pension insurance. In 2000, pension reform mainly consisted in paying off the arrears and raising the level of pensions. Arrears in September 2000 reached a zero level and did not re-emerge during the whole year after the above-mentioned date. Since the beginning of 2000, the real pension level was indexed by 7.5%, which allowed for maintain the purchasing power of the pensioners. Average pensions rose by 5% compared to that of its level at the beginning of the year and as of 1 September 2000 constituted 72.5 Hryvnias.

Reforming the secondary education system that has been started consists in transition to 12-year universal secondary education, and new syllabus for pre-school, universal secondary and beyond school education. It also includes introduction of new technologies in the area of education, computerization of the learning process, and preparation of new generation textbooks and learning tools. Results of the opinion poll among citizens of Ukraine do not show a very uniform view on the reform of secondary education, as proposed by the Ministry of Education. According to the results of the opinion poll conducted by the company GfK-USM (Ukrainian Survey and Market Research), ordered by the Institute of Politics at the end of 2000, more than half of the inhabitants of Kyiv are not yet ready to opt for a 12-year program in secondary schools and to adopt the 12-point system of examination. For 38% of Kyiv inhabitants, reform of education is a cause for concern rather than hope.

Data from ministries and other executive bodies in charge of educational institutions show the following. Arrears on payments of stipends, scholarships to students and pupils were reduced by 5.3 times in January 2001 and as of 1 February 2001 stood at 1.7 million Hryvnias, which is 8.8 times or 13.6 million Hryvnias less than the level of arrears at the corresponding period of last year.

One of the most acute social problems of Ukraine continues to be unemployment. At the beginning of February 2001, State Employment Service register included 1188.7 thousand individuals, 96.7% of whom were officially registered as unemployed. Majority of those who approached the State Employment Service was women (53.3%). Every third unemployed, that is, 38.8% was up to 28 years of age. The level of official unemployment for 2000 practically did not change and remained at the level of 4.2% of the employable population (in 1999 it was 4.3%). As of 1 January 2001 it was 1155.2 thousand persons. Percentage of the unemployed among the total work force at the end of the year was 5.31%. Information from the enterprises and organizations show that at the beginning of February this year the number of jobs and vacancies stood at 71.8 thousand against 50.7 thousand of the same period last year and 68.2 thousand of the beginning of this year.

Nominal money income of the population for 2000 in comparison with that for 1999 rose by 40.4% and amounted to 86833 million Hryvnias, and real money income, after deducting compulsory payments, voluntary deposits, and counting the impact of inflation, rose by 6.3%.

Average monthly income per capita for 2000 was 146 Hryvnias against 103.3 Hryvnias for 1999, expenditure and savings for 2000 was 83681 million Hryvnias, which was 40,6% more than that for 1999.

During most of the months of 2000, the rate of increase in nominal salaries superseded the increase in consumer prices, and consequently, real salaries underwent a 0.3% monthly increase.

Together with this, monthly average real salary index in 2000 in relation to that in the previous year was 99.1% (this indicator for 1999 in relation to 1998 was 91.1%).

Total wages and salary arrears decreased since February 2000. In general during 2000 salary and wages arrears were significantly decreased. Compared to the situation at the beginning of 2000, it decreased by 23% or by 1.5 billion Hryvnias and as of 10 January 2001 amounted to 4927 million Hryvnias. It is necessary to point out that, in 1999, the decrease was only by 1.8% and in 1998 and 1997 the arrears rose by 26.2% and 23.3% respectively. Arrears on social assistance payments, envisaged by the law of Ukraine "On State Support to Families with Children", during the course of January 2001 rose by1.3% or by 0.8 million Hryvnias. As of 1 February 2001 it stood at 62.3 million Hryvnias, which was 19.7% more than that of the same period last year or 10.3 million Hryvnias. In January 2001, 21.8 million Hryvnias is used for financing payment of arrears, which is 25.9% of the total need.

Government Activities in the Areas of Budget and Regional Policy

The main aim of the state regional policy, according to the Government Program, is the resolution of socio-economic problems of the regions by creating conditions alleviating the disparities in the levels of their socio-economic development. This envisages decentralization of the executive functions and delegating a large part of it to the regions, distinction and balancing of authority and power between central and local executive bodies and the bodies of local self government. It is also necessary to determine an effective mechanism of control to monitor the application of power and authority delegated to them. Allocating enough sources of revenue from the local budgets and optimizing the intra budgetary transfers will resolve the issue of providing financial self-sufficiency of the regions. The process of formation of assets of the territorial communities should be completed. Criteria for the eligibility of the regions to fall under the category of under-developed and state support for developing those regions should be worked out and endorsed at the legislative level. International cooperation for regional development should also be encouraged.

It may be confirmed that in 2000 the Government was unable to achieve serious changes in the system of internal budgetary relations. Thus, the bodies of local self-government did not get their expected better financing. A new and universal "code of conduct" in the system of local governance was not established. The scheme of calculating the budgetary indicators proposed by the Government allowed for drafting about 700 full-fledged budgets of oblast cities, cities under oblast administration and territorial communities. But the system of intra budgetary relations as proposed by the Government was taken out of the draft 2001 State Budget just prior to the voting in the parliament. The reason behind was the discontent of Kyiv and oblast elite with the draft, which envisaged significant independence of oblast and rayon level cities. The President of Ukraine also had a very firm critical stand on this issue, understanding that financial decentralization will mean weakening of the influence of the Administration of the President on the oblast and rayon level administration and on the situation in the region as a whole. Experts are of the opinion that, ways of reform of the system of intra budgetary relations were clearly indicated in the budget, in particular: distribution of power in implementing expenditure, stipulations of authority on profits, transfers based on objective and not subjective criteria. The oblast budgets would be generated from the budgets of the territorial communities and get 25% of the profits, as stipulated for the budgets of the local self-governments. Other expenditure needs of the oblast budgets would have to be compensated by transfers from the State Budget.

Political Aspects of the Government's Activities

Optimistic forecasts on the functioning of the Government were based on the fact of creation of a majority in the Verkhovna Rada, which declared its supports for the reform efforts of the President and the Government of Ukraine. However, the "parliamentary majority" was artificial and situational. It would be more correct to speak about the reformist potential within the pro-government parliamentary majority (about 120-150 deputies). Voting in the Verkhovna Rada of Ukraine in favor of including government initiatives into its agenda gives the bases to state that the pro-government part of the majority in the Ukrainian parliament (unlike the pro-presidential majority) was not situational.

On the other hand, financial-political groups dominating the parliament of Ukraine today openly showed their discontent with the actions and initiatives of the government, which was reflected in the publications and TV programs, controlled by these groups. Undoubetedly, criticism on behalf of certain political forces was in response to the campaign, initiated by the Government in weaning off the energy sector from the control of the financial-political (oligarchic) groups. They also responded fiercely to the Government's active fight against their tax evasion, against removing those groups who had used offshore zones from having advantage during privatization of various sectors of the economy, from influencing decision making and allocation of budgetary resources. Active confrontation with the oligarchic groups led to the fact, that the latter used the relations between the President and the Prime Minister and transformed them into relations between opponents, spreading widely a thesis that V. Yushchenko is a potential candidate for the next presidential elections. Making use of the media, which are under their control, they tried to portray the image of a politician for Yushchenko, who seemingly was conducting campaign for his potential candidacy in the future presidential elections, ignoring the resolution of acute socio-economic problems of the country. A rumor that Yushchenko might resign during spring of 2001 was also spread wide. Despite all this, the days of Yushchenko Government in Ukraine saw drastic weakening of the omnipotence of several financial-oligarchic groups, a more strong hand while dealing with export import operations in the fuel and energy sector, and in relation to privatization of large state enterprises.

Despite various appeals from deputies of oligarchic factions, concrete voting of the parliamentarians showed that the level of support to the Yushchenko Government at least during the year was sufficient, in order to implement the priorities laid down in the Government Program.

We should note that, practically from the very beginning of its functioning, the Government was forced to be under harsh criticism not only from these oligarchic factions of the parliament and mass media under their control but also from the President of Ukraine. The criticism of the latter was mainly concentrated on the Government's activity in the fuel and energy sector and privatization. The work of the Government was also complicated due to certain contradiction on issues of reform of the Ukrainian economy, which emerged between the Yushchenko Government and the State Tax Administration, Council for National Security and Defence at the end of 2000.

Activization of the political life in 2001, a factual start of the pre election campaign, imperfect legislative framework undoubtedly payed their role in the situation around the Government.

Government Activities in the Field of Law Making

In general, as of 7 March 2001, the parliament reviewed 212 draft laws submitted by the Yushchenko Government. Of them, 82 were approved on the whole, 62 were rejected or taken out of the agenda. Other drafts were in various stages of the legislative process. Comparatively, the Government submitted less number of draft laws, but this does not indicate the bad performance of the Cabinet of Ministers. From the very beginning of his term in office, Prime Minister Victor Yushchenko called back a large number of draft laws submitted by the previous government, and after improvement, they were resent for consideration again to the Verkhovna Rada, but the authorship to these drafts remained with the previous government.

Certain indicators are shown below to compare the results of review of draft laws submitted by the Cabinet of Ministers to the Verkhovna Rada during the term of the Yushchenko and Pustovoitenko Governments.

Cooperation of the Government with the parliamentary majority

Research conducted by the Institute of Politics on the subject of support of the government initiatives by the parliament during 2000 gives bases to conclude, that only political circumstances were the decisive factor in such support. Parliamentary majority by itself was never a homogeneous entity, rather a situational union of various political and socio-economic motivations. Analysis of the pattern of voting on key legislative drafts during 2000 shows significant changes in the structure and mood of the majority in each individual case. Overall, the majority could hardly be called pro-governmental. Despite the fact that the Cabinet could count on the support of about 150 deputies only, certain level of cooperation between the Government and the Parliament was achieved, which was instrumental in implementing major initiatives of the Cabinet of Ministers. However, the tough policy of the Government, especially in the energy sector caused discontent of the influential financial oligarchic groups. This undoubtedly complicated the relations between the parliamentary majority and the Government. In fact, we can speak about opposition to the Government not only from the traditional formal opposition - the Communist Party, Progressive Socialist Party of Ukraine, but from the factions of such parties as "Revival of the Regions" or the Social Democratic Party of Ukraine (united), vested interests of whose members went against that of the Government. In this sense it is correct that, cooperation between the main legislative and executive bodies was ideologically more consistent during the term of Valeriy Pustovoitenko as the Prime Minister of Ukraine. It is also interesting to note that, in terms of percentage, the number of draft laws of the Yushchenko Government, which were adopted by the parliament were 3.13% less than the number of draft laws approved, submitted by the Pustovoitenko Government. But 16,48% more drafts were rejected submitted by the previous Cabinet. This demonstrates the fact that draft laws of the tenth government were more concrete and economically sound, while they were controversial from the point of vested interest of the clans.