The Efficiency of Social Policy in Ukraine: Challenges and Prospects
The Efficiency of Social Policy in Ukraine: Challenges and Prospects

Summary/Abstract: The article considers pertinent issues related to social policymaking and its implementation in Ukraine. Emphasis is placed on remuneration as the key element of ensuring citizens’ welfare and economic development of the state. Remuneration plays one of the most important roles in the economic system and ensuring a decent standard of living. The wage refl ects the employee’s welfare level and should be correlated with the qualification level and productivity in the production spheres or determined according to the set qualification criteria, quality assessment system and efficiency of employees in non-production spheres. Low remuneration standards and low correlation between wages and productivity affect the motivation of the workforce and reduce its economic and labour activity. The analysis of the minimum wage and subsistence level as the categories defining the status and directions of economic and social policy of the state has been performed. The minimum wage has a decisive infl uence on many social and economic processes. A significant issue in Ukraine is that establishing the minimum wage in the legislation is made without objective analysis and taking into account the financial and economic conditions that should be the basis for the state social policymaking. The minimum wage directly affects the volume and structure of the expenditure part of state and local budgets, as it is one of the basic elements for making the payroll of budgetary institutions and organizations. For business structures, the minimum wage is an indicator that refl ects the economic and social policy of the state, as well as a microeconomic category that affects their current business activities and the production and financial strategy making. Some aspects of the current social protection system in Ukraine have been described. One of the main issues in Ukraine is the excessive number of legislative acts regulating social protection matters. Another important issue is that a significant number of benefits and social transfers, which are stipulated in the legislation and guaranteed to the citizens, cannot be implemented due to lack of financial resources in the state budget. Today, one of the priority tasks of the state policy is to address issues of reforming the social protection system and the introduction of new efficient mechanisms for financing and managing the social services system. It has been noted about the need to develop and set in the legislation a system of social standards and norms, as well as the development of a standardised mechanism for determining the minimum wage and subsistence level based on and depending on the socio-economic development indicators.

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