Public finances: features of performing functions in wartime

Abstract

The relevance of this study is dictated by modern challenges, threats and the need to establish the features of the implementation of public finance functions in wartime. The purpose of the study is to conduct a comparative analysis of the formation and management of public finances in martial law and peacetime, as well as to identify the main features. The research methodology is based on the application of a systematic analysis of the indicators of the consolidated budget of Ukraine in peacetime and during the period of Russia's large-scale invasion of the territory of Ukraine, the application of comparative analysis methods to determine the specific weight of state and local budgets in the overall structure of consolidated budget expenditures. Official data of the Ministry of Finance of Ukraine, the National Bank of Ukraine and other statistical materials, scientific articles, regulatory legal documents relating to public finance management in different periods were used. The results of the study confirmed the important role of public finances in financing the main functions, both in peacetime and during wartime, designed to care for the well-being of citizens, ensure the country's defense capability, protect human rights and freedoms, and ensure the sustainable dynamics of the country's socio-economic development, etc. It was established that during the war, significant changes occurred in terms of strengthening centralization and increasing the share of state budget expenditures, while the share of local budgets in the overall structure of the consolidated budget of Ukraine decreased. The priorities of budget policy have fundamentally changed and, accordingly, the amount of funding for the security and defense sector has increased. The conclusions of the study confirm the importance of the expenditures of the State Budget of Ukraine in financing the ever-growing needs of the Armed Forces of Ukraine for their provision with FPV drones, ammunition, and other weapons. The important role of grant aid from the EU, Ukraine's partner countries, donor institutions and international financial organizations in financing the expenditures of the State Budget of Ukraine in war conditions, as well as increasing the volume of public debt and making payments for its servicing and repayment, is confirmed. A hypothesis is put forward and the need to further distinguish the state budget by: economic, political, social and military significance is substantiated.