Life Defeats Death: What Is Happening in Protected Areas of Southern Ukraine
According to a statement by the Ministry of Environmental Protection and Natural Resources, more than 20% of Ukraine’s protected natural areas – 812 nature reserve fund sites (NRF) with a total area of 0.9 million hectares have been affected by the war. A total of 514 NRF sites covering 0.80 million hectares remain under occupation. This list and the scale of losses may continue to grow because fighting continues in parts of Ukraine, while other areas remain occupied or await demining.
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Legitimacy of City Authorities in the Eyes of Odesa Residents
Green Leaf has already reported that Odesa residents appealed to the city authorities asking that unallocated city budget funds be directed to the needs of combat units of the Defense Forces of Ukraine. To recap, the appeal was sent to the Mayor of Odesa, every member of the Executive Committee of the Odesa City Council, and, via the councillors’ portal, personally to every city councillor.
The city authorities remain silent or send formal replies
According to information provided by Iryna Kostenko, representatives of the city authorities are in no hurry to perform the duties entrusted to them. As of June 19:
1. No response has been received from the Mayor of Odesa.
2. Among representatives of the Executive Committee, only the Department of Municipal Security has provided a response.
This “response” does not provide any substantive answer to the issues raised in the collective appeal and is, in effect, a form letter.
3. Of the 56 councillors listed on the councillors’ portal, only three have replied. They are:
– Iryna Lioneliyivna Holovatiuk-Yuzefpolska, “TRUST IN DEEDS”;
– Zhanna Vasylivna Mandrychenko, “EUROPEAN SOLIDARITY”;
– Olha Oleksiivna Kvasnitska, “SERVANT OF THE PEOPLE”.
It should be noted that under the Law of Ukraine “On the Status of Deputies of Local Councils”, “A deputy of a local council, as a representative of the interests of the territorial community and the voters of their electoral district, is obliged to express and defend the interests of the relevant territorial community and its part — the voters of their electoral district, to carry out their instructions within the powers granted by law, and to take an active part in local self-government.”
In practice, however, we see that most members of the Odesa City Council of the VIII convocation do not regard themselves as representatives of their voters’ interests.
In conclusion.
Odesa residents gave the city authorities a test. Once again, the city authorities failed it. In fact, today we can speak of a major crisis of trust between residents and the authorities, and even most city councillors are making no effort at their level to overcome this crisis.
Regional Program as an Instrument of Corruption: The Case of Odesa Oblast
Local target programs are an integral part of the budget process for local self-government bodies. They are a tool for defining specific tasks and measures for effective financial management across all areas of community life. But Odesa Oblast shows how an important regional program can become an uncontrolled instrument for enriching local “elites.” This concerns the Regional Comprehensive Environmental Protection Program of Odesa Oblast for 2024–2028.
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Green Leaf NGO Activity Report for 2022
After the start of Russia’s full-scale invasion of Ukraine, members of the Green Leaf NGO team began focusing on what Odesa and Odesa Oblast needed most: security and strengthening the region’s defense capability. This included assistance to the Armed Forces of Ukraine and Odesa’s Territorial Defense brigade, strengthening social protection for residents and internally displaced people from “hot spots,” coordinating volunteer centers, documenting Russia’s environmental crimes, monitoring city-budget spending on security needs, conducting anti-corruption investigations into the actions of Odesa city authorities, and promoting derussification and decolonization in the Odesa region.
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What the Odesa Regional Military Administration Hides in the 2023 Regional Budget
At present, the Odesa Regional Military Administration is trying to conceal as much as possible both important public documents and the overall indicators of the Odesa Oblast regional budget. This is done in the simplest way: public information is simply not published, in violation of the law. It sometimes seems that the administration’s PR staff post endless photos of Kiper in different poses specifically to distract public attention from the complete opacity of the regional authorities. Fortunately, information on execution of the regional budget can also be obtained from the annual reports of the State Treasury Service of Ukraine. This is public information; the Regional Military Administration simply “forgot” about it. Separately, I note that analysis of the revenue and expenditure parts of the previous budget year is by itself important mainly for scale. However, together with analysis of target programs adopted at the same time — such as the “Regional Comprehensive Environmental Protection Program of Odesa Oblast for 2024–2028” worth almost UAH 4 billion — it can at least serve as an indicator of the Odesa Regional Military Administration’s effectiveness during the war. We will return soon to analysis of this “environmental” program; for now, let us look more closely at the 2023 regional budget indicators.
General overview of the 2023 budget
If the 2023 regional budget is expressed in a few figures showing actual revenues, expenditures and balances, the picture is as follows:
Opening balance — UAH 1,714.3 million (UAH 1.7 billion)
Revenue — UAH 7,239.5 million (UAH 7.2 billion)
Budget expenditures — UAH 6,367.6 million, including:
— direct budget expenditures — UAH 6,075.8 million
— loans issued from the budget, shown under lending — UAH 34.6 million
— borrowings repaid, shown under financing — UAH 257.3 million
Other calculations* — UAH 85.8 million
(Taking into account interbudgetary transfers passed between local budgets)
Closing balance — UAH 2,500.5 million (UAH 2.5 billion).
Opening balance
These figures show how much money was held in regional-budget and budget-institution accounts at the beginning of the year.
Balances in budget-institution accounts — UAH 92.7 million.
Balances in budget accounts — UAH 1,621.6 million, of which UAH 270.7 million represented balances of subventions from the state budget.
Budget revenue
These figures show how much money was received into budget and budget-institution accounts during the year.
Tax revenues amounted to UAH 3,718.0 million, including:
— personal income tax and related levy — UAH 3,234.0 million
— corporate profit tax — UAH 434.8 million.
Non-tax revenues amounted to UAH 424.3 million, including:
— administrative fees and payments and income from non-commercial economic activity — UAH 101.0 million
— own-source revenues of budget institutions — UAH 299.6 million.
Revenue from capital transactions, mainly proceeds from disposal of property, amounted to UAH 1.8 million.
Another UAH 2.6 million was received into the regional budget as revenue under assistance programs of foreign governments, international organizations and donor institutions.
UAH 0.8 million was received into regional-budget earmarked funds.
Interbudgetary transfers totaled UAH 3,092.0 million, including:
— grants from the state budget — UAH 211.3 million
— subventions from the state budget — UAH 2,159.9 million
— subventions from local budgets — UAH 720.8 million, of which UAH 606.6 million were other subventions. It was under this code that other local budgets transferred money to the regional budget “for the Armed Forces.” In the absence of any explanations, we will assume that all funds under this subvention were precisely the funds provided by territorial communities to the regional budget “for the Armed Forces.”
Budget expenditures
According to Article 10 of the Budget Code of Ukraine, budget expenditures are grouped on the basis of the standard program classification of local-budget expenditures, approved by the Ministry of Finance.
Under this classification, all regional-budget expenditures are grouped as follows:
0100 Public administration
This code records expenditures on maintaining the Odesa Regional Council and its subdivisions.
These expenditures amounted to UAH 89.3 million.
Note that this code does not include financial support for municipal enterprises, even where the Regional Council itself provides the funding. Such support for municipal enterprises is recorded under code 7693.
1000 Education
This includes expenditures on general secondary education in special schools, sanatorium schools, lyceums and educational-rehabilitation centers; vocational education, professional pre-higher and higher education; purchase of school buses and so on. Total expenditure in this area was UAH 1,610.0 million (UAH 1.6 billion).
2000 Health care
This includes payment for utilities and energy used by municipal health-care institutions, funding of regional development and support programs for municipal health-care facilities, regional public-health programs, and other institutions and activities within the health-care system, including infant homes, blood-service institutions, medical-social expert commissions and specialized medical-supply bases.
Total expenditure in this area was UAH 484.9 million.
3000 Social protection and social security
This includes financing social-protection and social-security programs, providing social and rehabilitation services to older people, persons with disabilities and children with disabilities in social-service institutions, support for internally displaced persons and more.
Total expenditure in this area was UAH 537.8 million.
4000 Culture and arts
This includes financial support for theaters, philharmonic organizations, artistic and musical groups, ensembles, concert and circus organizations; support for libraries, museums and exhibitions, palaces and houses of culture, clubs, leisure centers and other club institutions; and financing other institutions and activities in culture and the arts.
Total expenditure in this area was UAH 280.4 million.
5000 Physical culture and sport
This includes sports activities in the region, physical-culture, sports and rehabilitation work for persons with disabilities, development of youth and reserve sport, support and development of sports infrastructure, and other measures for developing physical culture and sport.
Total expenditure in this area was UAH 110.0 million.
6000 Housing and municipal services
This includes expenditures related to issuing and servicing preferential long-term loans to citizens for construction/reconstruction/purchase of housing and reducing mortgage costs to provide affordable housing to citizens who need improved housing conditions.
Total expenditure in this area was UAH 1.3 million.
7000 Economic activity
This includes programs and measures related to economic activity. Mainly:
— implementation of agricultural programs totaling UAH 0.1 million.
— construction and regional development, including construction and repair of social and cultural facilities, restoration and protection of architectural monuments and implementation of investment projects totaling UAH 197.9 million.
— maintenance and development of roads and road infrastructure totaling UAH 849.0 million, including:
UAH 258.6 million from the regional budget
UAH 549.9 million from a state-budget subvention
UAH 40.5 million from other local budgets
— other programs and measures related to economic activity totaling UAH 113.0 million, of which UAH 107.9 million was financing for municipal enterprises.
Total expenditure in this area was UAH 1,166.0 million (UAH 1.17 billion).
8000 Other activity
This includes expenditures not assigned to other sections. These were:
— other public-order and safety measures totaling UAH 0.3 million
— territorial-defense measures and works totaling UAH 32.0 million. Note that UAH 233.8 million had been planned. In fact, these measures were funded at only 13.7% of the planned amount.
— prevention and elimination of environmental pollution, which took the form of waste disposal totaling UAH 31.4 million. Pay attention to these expenditures. All the money was paid to the company Ukrekoprom, whose activities became the subject of dozens of criminal proceedings available in the court archive. One proceeding, for example, concerns how the company allegedly dumped sewage within Odesa instead of disposing of it properly.
— servicing local debt totaling UAH 55.6 million. This was interest paid on loans in 2023.
Total expenditure in this area was UAH 119.3 million.
9000 Interbudgetary transfers
This section records funds transferred from the regional budget as grants and subventions both to local budgets and to the state budget.
Total expenditure in this area was UAH 1,676.9 million.
We also note that under code 9800, “Subvention from a local budget to the state budget for implementation of regional socio-economic development programs,” through which funds are also transferred for the Armed Forces and for which the Odesa Regional Military Administration collected money from Odesa Oblast communities, expenditures totaled UAH 635.4 million. This almost matches the figure for “Other subventions from local budgets” on the revenue side of the regional budget.
Closing balance
These figures show how much money remained in the accounts of the regional budget and budget institutions at the end of the year.
Balances in budget-institution accounts — UAH 114.7 million.
Balances in budget accounts — UAH 2,385.8 million, of which UAH 446.6 million represented balances of subventions from the state budget, namely:
| Name of state-budget subvention to local budgets | Amount, UAH million |
| Education subvention | 223.0 |
| — for design, restoration, construction, modernization, equipping and repair of public-purpose construction facilities, social facilities, cultural heritage, housing and municipal infrastructure and other facilities affecting everyday life | 69.6 |
| — for state support to persons with special educational needs | 9.7 |
| — for financing construction, reconstruction, repair and maintenance of local public roads and municipally owned streets and roads in settlements | 144.3 |
We also note that during 2023 the increase in balances held in regional-budget accounts, excluding balances of subventions from the state budget, exceeded UAH 580 million.
Conclusion
An analysis of the overall orientation of the Odesa regional budget shows that the Regional Military Administration finances social and cultural institutions, road construction and calmly repays previously contracted loans…
But despite having substantial free financial resources measured in billions of hryvnias, there is no significant assistance to combat units of the Defense Forces of Ukraine funded specifically from the regional budget.The assistance provided under code 9800 consists almost entirely of funds transferred to the regional budget by communities of Odesa Oblast.
Could this be precisely why the Odesa Regional Military Administration is trying to conceal its activities from public view?
For reference, we inform Green Leaf readers that anyone can download the State Treasury Service of Ukraine report on execution of the Odesa Oblast regional budget and independently analyze the budget indicators. The report is available at the link (Report on execution of the Odesa Oblast regional budget for 2023).
Chronicle of Russia’s War Crimes Against Ukraine’s Environment: Odesa Oblast, May 2024
Over the past 10 years, May has been a month when the Russian chauvinists’ obsession tends to intensify, and they take revenge on Ukrainians for the “Odesa Khatyn,” shelling our cities especially fiercely on the day of their “victory cult.” May 2024 was no exception: at the beginning of the month, Odesa and Odesa Oblast were heavily attacked with drones and missiles.
We collect facts about crimes committed by the Russian Federation against the natural environment of Odesa and Odesa Oblast during the war: environmental pollution caused by explosions and damage to infrastructure, contamination of air, water and soil with toxic substances, destruction of ecosystems in protected areas and internationally important conservation areas, and more. The information will be updated daily, so please send facts known to you to: zeleniy.list1@gmal.com
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Did the Odesa Authorities Finally Hear Odesa Residents?
Green Leaf recently wrote that concerned Odesa residents who gather outside City Hall every Saturday appealed to the city authorities demanding that city-budget funds be directed to combat units of the Defense Forces of Ukraine rather than to non-priority expenditures. The collective letter was submitted to Odesa City Council on May 13 and, during May 13–14, was sent electronically through the deputy portal to every member of Odesa City Council.
And, surprisingly enough, the people of Odesa were heard.
On May 20, Odesa Mayor’s Order No. 400 of May 20, 2024 was issued, convening an extraordinary session for May 22.
An analysis of the draft decisions published on the city’s official website on May 21 shows that the city authorities want to urgently allocate UAH 36 million from the free balance of budget funds to our renowned brigades. Deputies are therefore being asked to support both amendments to the budget and changes to the municipal target program “Safe City Odesa.”
We also recall that the collective appeal referred to a free balance of UAH 945 million that should be directed to financing the urgent needs of combat units of the Defense Forces of Ukraine.
We hope that this UAH 36 million is only the first step by the managers hired by the people of Odesa toward carrying out the will of Odesa residents.
On the Activities of Ukraine’s State Audit Service
Analyzing the work of Ukraine’s State Audit Service (formerly the Control and Revision Office), one cannot escape the feeling that ordinary people live in one world while the State Audit Service lives in another. When those worlds intersect, one simply does not understand the other. We will demonstrate this using two examples of the work of the State Audit Service and its territorial offices. What follows is a Green Leaf report.
Example 1 — state financial audit of the budget of the Odesa City Territorial Community
At the end of 2023, the State Audit Service conducted a “State financial audit of the budget of the Odesa City Territorial Community (the budget of the City of Odesa) for the period from January 1, 2020 to September 30, 2023.” The audit was conducted pursuant to item 3.1 of the State Audit Service Order dated September 19, 2023. At the same time, the leadership of the State Audit Service called on citizens to report possible abuses by city officials in the use of budget funds:
Head of the State Audit Service Alla Basalaieva on the State Audit Service website;
Head of the Southern Office of the State Audit Service Oleksandr Stavniichuk on the Southern Office website.
Applications to the State Audit Service from Green Leaf NGO
Fulfilling its civic duty, Green Leaf submitted to both the State Audit Service and its Southern Office the materials it had concerning the allegedly unlawful registration of the Prymorskyi District Administration of Odesa City Council as a legal entity.
This conclusion is based on the fact that Odesa City Council Decision No. 412-XXIV of October 15, 2002, signed by Ruslan Bodelan, approved the structure of the executive committee of Odesa City Council, including the Prymorskyi District Administration as a territorial subdivision of the executive committee of Odesa City Council.
Following up on Decision No. 412-XXIV (copy at the link, APPENDIX 1), on October 21, 2002 the executive committee of Odesa City Council adopted its own Decision No. 338 establishing district administrations, including the Prymorskyi District Administration of the Executive Committee of Odesa City Council as of January 1, 2003 (copy at the link, APPENDIX 2).
On the same day, October 21, 2002, a public-law legal entity was registered — the Prymorskyi District Administration of Odesa City Council. State registration certificate of the Prymorskyi District Administration of Odesa City Council, series A00 No. 255275 dated October 21, 2002 (copy at the link, APPENDIX 3).
As follows from the materials above, because there was no Odesa City Council decision creating an executive body called the Prymorskyi District Administration of Odesa City Council, it cannot be regarded either as a public-law legal entity within the meaning of the Civil Code of Ukraine or as a budgetary institution within the meaning of the Budget Code of Ukraine.
Duplicating the work of Odesa City Council departments and offices
In the application, we separately drew attention to the fact that of the 57 staff positions in the Prymorskyi District Administration staffing schedule (copy at the link, APPENDIX 4), 24 positions serve the administrative apparatus of the district administration itself. These are the head and deputy heads, chief specialists in civil protection, secrecy regime and personnel work, the secretary of the administrative commission, and departments for accounting, reporting and administrative support, general affairs, organizational work and public relations, and work with citizens’ appeals. Another 26 positions duplicate the work of Odesa City Council departments and offices. Specifically:
— the functions of the district administration’s legal department correspond to the core tasks of the Odesa City Council Legal Department
— the functions of the district administration’s socio-economic department and housing-allocation department correspond to the core tasks of the Odesa City Council Department of Economic Development
— the functions of the department supporting the guardianship and trusteeship body correspond to the core tasks of the Children’s Service
— the functions of the district administration’s housing-services department correspond to the core tasks of the Department of Municipal Services
— the functions of the district administration’s department for control and monitoring of the district’s territory correspond to the core tasks of the City Improvement Department.
Thus, among all structural units and positions of the Prymorskyi District Administration of Odesa City Council, the only genuinely useful unit turned out to be the department maintaining the State Register of Voters, with only seven staff members and functions that are not duplicated, and therefore could be transferred to other executive bodies of Odesa City Council together with the department’s staff.
All of the above was submitted by Green Leaf both to the State Audit Service and to its territorial subdivision, the Southern Office of the State Audit Service.
In its applications, Green Leaf asked:
1. To conduct a state financial audit of the legality of financing from the city budget the legal entity Prymorskyi District Administration of Odesa City Council, for which Odesa City Council never adopted a decision establishing it as an executive body, and which is neither a public-law legal entity within the meaning of the Civil Code of Ukraine nor a budgetary institution within the meaning of the Budget Code of Ukraine.
2. To verify the allegedly unlawful conferral by the Odesa City Council Finance Department, represented by its director S. M. Bedreha, of the legal status of chief administrator of budget funds of the City of Odesa and the legal status of chief administrator of the budget of the Odesa City Territorial Community.
3. To exercise state financial control over the efficiency of using funds from the budget of the Odesa City Territorial Community to maintain the allegedly unlawfully registered legal entity Prymorskyi District Administration of Odesa City Council.
We received a response from the State Audit Service to our application (copy at the link, APPENDIX 5).
As can be seen, in its response the State Audit Service cites various procedures, explains that Odesa City Council Decision No. 412-XXIV of October 15, 2002 approving the staffing structure ceased to be valid in 2006, describes the regulations governing the Prymorskyi District Administration, points out who approved its staffing schedule, and states — without conducting state financial control of the efficiency of expenditures — that the Prymorskyi District Administration meets the requirements established by Article 22 of the Budget Code of Ukraine for chief administrators of budget funds. And much more besides.
But it does not answer the main question: was a public-law legal entity called the Prymorskyi District Administration of Odesa City Council ever legally created at all?
As stated in the XXXXX State Audit Service document (copy at the link, APPENDIX 6), they did not even include this issue in the report.
Was the Odesa City Council Finance Department legally established as a legal entity?
There is more. Green Leaf began a journalistic investigation into the formal establishment of another public-law legal entity — the Odesa City Council Finance Department, which was also inspected by representatives of the State Audit Service.
According to the state registration certificate obtained (copy at the link, APPENDIX 7), the Odesa City Council Finance Office was registered on October 7, 2005, and on May 7, 2008 its certificate was replaced after its name was changed to the Finance Department. But in addition to a state registration certificate there should also be a council decision establishing such a body, adopted pursuant to paragraph 6 of part 1 of Article 26 of the Law of Ukraine “On Local Self-Government in Ukraine.” This requirement was established by Article 24 of the Law of Ukraine “On State Registration of Legal Entities, Individual Entrepreneurs and Public Associations,” in the version in force at the time of registration of the Odesa City Council Finance Office. Yet the state registration authorities do not have such a decision. This is confirmed by the final paragraph of the response from the State Registration Office of the Legal Department of Odesa City Council (copy at the link, APPENDIX 8), which states that despite the requirements of the Law of Ukraine “On State Registration of Legal Entities, Individual Entrepreneurs and Public Associations” in force at the time of the registration actions — which required, among other things, submission for registration of a copy of the founders’ decision or a decision by a body authorized by them to create the legal entity — “it is impossible to provide such a decision due to its absence from the materials of the legal entity’s registration file.”
Summing up the above, only one question arises: how incompetent must State Audit Service employees be if, while auditing public-law legal entities, they fail to notice that those entities were never created in the procedure established by law, even when materials provided by the public indicate the opposite?
Example 2 — terrorizing Tuzly Estuaries National Nature Park under the guise of an audit of financial and economic activity
On March 20, 2024, a news item appeared on the State Audit Service website titled “Auditors were denied access to audit the activities of Tuzly Estuaries National Nature Park in Odesa Oblast.”
If one analyzes only this news item, the impression is that the staff of Tuzly Estuaries National Nature Park are some kind of villains whose alleged criminal activity is known to both MPs and the Security Service of Ukraine, while state auditors are simply prevented from carrying out inspections.
But a more careful analysis showed that this so-called “news” item published on the State Audit Service website does not, to put it mildly, correspond to reality and is manipulative.
It is true that item 1.3.5.1 of the Plan of State Financial Control Measures of the Southern Office of the State Audit Service for the first quarter of 2024 provides for an audit of certain aspects of the financial and economic activity of Tuzly Estuaries National Nature Park. But if one looks at the stated basis for the state financial control measure, it refers only to a letter from the Odesa Regional Directorate of the Security Service of Ukraine dated June 2, 2023 No. 65/5/i/6-2616.
The first question therefore arises: where in the Plan of state financial control measures is the parliamentary appeal mentioned in the “news” item, which according to that publication supposedly gave rise to suspicions about possible inefficient or unlawful use of budget funds allocated to Tuzly Estuaries National Nature Park? It is simply absent from the inspection plan.
Contrived grounds for conducting the audit
The letters obtained by Green Leaf and cited as grounds for the audit do not, in our view, provide legal grounds for auditing Tuzly Estuaries National Nature Park.
The parliamentary request concerning an audit of Tuzly Estuaries National Nature Park, signed by two members of the Verkhovna Rada of Ukraine — two, not one as stated in the “news” item — (copy at the link, APPENDIX 9), Oleksandr Tkachenko and Antonina Slavytska, is based on an appeal from a person who asked MP Tkachenko to provide public information on audits by the State Audit Service of certain aspects of the financial and economic activities of Tuzly Estuaries National Nature Park starting from 2015. Why Oleksandr Tkachenko did not forward the letter to the State Audit Service according to jurisdiction so that the requester could receive public information, as required by the relevant law, is unknown. It is also unclear why the MPs decided that this letter to MP Oleksandr Tkachenko was grounds for demanding an audit of Tuzly Estuaries National Nature Park. Even the State Audit Service apparently understood that the parliamentary request could not be regarded as a legal basis for an audit, which is why it was not included in the order authorizing the inspection. But when preparing the “news” item about the allegedly criminal conduct of Tuzly Estuaries National Nature Park, the State Audit Service apparently decided that a reference to an MP’s appeal would add weight, while providing no specifics.
Role of the Security Service of Ukraine
Now regarding the letter from the Odesa Regional Directorate of the Security Service of Ukraine dated June 2, 2023 No. 65/5/i/6-2616. It exists and was indeed sent to the Southern Office of the State Audit Service, which provided it in response to a public-information request. It can be reviewed at the link (copy at the link, APPENDIX 10). As can be seen, it is an ordinary communication from one state body to another.
But the question arises: did a structural subdivision of the State Audit Service have the right to audit the activities of Tuzly Estuaries National Nature Park on the basis of this letter from the Odesa Regional Directorate of the Security Service of Ukraine?
The answer is contained in the Procedure for Conducting Inspections by the State Audit Service and Its Interregional Territorial Bodies, approved by Cabinet of Ministers Resolution No. 550 of April 20, 2006. The Procedure contains an entire section titled “Specifics of conducting an audit at the request of a law-enforcement body”, consisting of paragraphs 27–34.
The letter from the Odesa Regional Directorate of the Security Service of Ukraine does not meet the requirements established by paragraph 28 of Procedure No. 550 and, pursuant to paragraph 30 of that Procedure, should have been returned.
Nevertheless, the leadership of the Southern Office of the State Audit Service, in violation of Procedure No. 550, began treating the Security Service letter as grounds for conducting an audit.
This raises a second question: what was the lawful basis for the Southern Office of the State Audit Service to include Tuzly Estuaries National Nature Park in its inspection plan at all? Perhaps there was no lawful basis, and the reference to the Security Service letter of June 2, 2023 No. 65/5/i/6-2616 was simply based on the principle that “it will do.” At present there is no answer to this question.
In this situation, the position of the State Audit Service is difficult to understand. Because pursuant to subparagraph 3 of paragraph 5 of the Regulation on the State Audit Service of Ukraine, approved by Cabinet of Ministers Resolution No. 43 of February 3, 2016, the State Audit Service not only failed to exercise oversight over the Southern Office of the State Audit Service but also published on its own website a “news” item that, in our view, does not correspond to reality.
Iryna Vykhrystiuk’s comment on the State Audit Service audit
We also contacted the acting director of Tuzly Estuaries National Nature Park and asked her to comment on the situation.
Iryna Vykhrystiuk stated the following:
From September through December 2023, auditors from the Southern Office of the State Audit Service collected information within the state financial audit of implementation of budget programs by the Ministry of Environmental Protection and Natural Resources of Ukraine for 2020–2022 and the first half of 2023 at Tuzly Estuaries National Nature Park, covering the period from January 1, 2020 to June 30, 2023.
For more than three months, in the Park’s administrative building and remotely, auditors examined programmatic, economic and financial issues concerning the Park. In addition, auditors received explanations on the Park’s core activities, including the State Protection Service. In practice, an inspection blocks the institution’s work because the head of the institution, the lawyer, accounting department, economic and technical department and State Protection Service had to provide endless explanations and copy numerous materials. The auditors’ actions appeared biased and unprofessional because they did not understand how a protected-area institution operates, particularly its State Protection Service. In December 2023, auditors from the Southern Office issued comments in a Certificate on collection of information at Tuzly Estuaries National Nature Park as part of the state financial audit of implementation of budget programs by the Ministry of Environmental Protection and Natural Resources of Ukraine for the period January 1, 2020 to June 30, 2023. The Certificate contained many unreliable statements that were contradicted by regulatory documents and explanations already provided. The Park administration supplied explanations concerning the comments contained in the Southern Office’s Certificate.
On December 20, 2023, Order No. 299 of the Southern Office of the State Audit Service approved the “Plan of State Financial Control Measures of the Southern Office of the State Audit Service (and the Southern Office departments in Mykolaiv and Kherson regions) for the first quarter of 2024, SECTION I ‘Apparatus of the Southern Office of the State Audit Service.’” Pursuant to item 1.3.5.1 of the Plan, an audit of certain aspects of the financial and economic activity of Tuzly Estuaries National Nature Park for the period from January 1, 2020 to December 31, 2023 was scheduled to begin in March. The stated basis for inclusion in the Plan was the letter from the Odesa Regional Directorate of the Security Service of Ukraine dated June 2, 2023 No. 65/5/i/6-2616.
At the same time, the Odesa Regional Directorate of the Security Service of Ukraine sent its letter to the State Audit Service on June 2, 2023, in the second quarter. Therefore, all issues of interest to the Security Service that fell within the competence of the State Audit Service should have been examined during the review conducted at the Park from September through December 2023, in the third and fourth quarters.
On March 13, 2024 at 11:30, Nina USENKO, chief state auditor of the Department for Control in Agriculture, Ecology and Natural Resources of the Southern Office of the State Audit Service, and Olena KARTAKAI, chief state auditor of the same department, arrived at the administrative building of Tuzly Estuaries National Nature Park. They presented the acting Park director with assignment No. 107 dated March 7, 2024, assignment No. 106 dated March 7, 2024, and the Program for auditing certain aspects of the Park’s financial and economic activity (hereinafter, the Audit Program). The documents provided did not include a copy of the letter from the Odesa Regional Directorate of the Security Service of Ukraine dated June 2, 2023 No. 65/5/i/6-2616 on which the inspection was based, despite repeated requests by the head of the institution to provide the letter for review. The Security Service letter, which was the basis for the Park inspection, was the key document; its absence and refusal to provide it despite repeated requests indicated, in the Park’s view, a commissioned inspection. Failure to provide the letter to the inspected entity violates its rights because without the letter we cannot determine whether paragraph 28 of Cabinet of Ministers Resolution No. 550 of April 20, 2006 has been violated, or establish an exhaustive list of issues when it is unclear what the Security Service letter actually contained. It should be noted that MP Solomiia Bobrovska was also unable to obtain this letter from the Security Service in response to her request. At the same time, the Audit Program included issues outside the Security Service’s sphere of control and investigative jurisdiction, as well as issues already examined in the third and fourth quarters of 2023 during the review and information collection within the inspection of the Ministry of Environmental Protection for 2020 through the first half of 2023.
When representatives of the Southern Office of the State Audit Service arrived, Park employees did not create any obstacles for them. First, the representatives were asked to register in the Log of Inspections of the Controlled Entity, but they refused. They were then asked at least to sign the Park visitors’ log, and they refused that as well.
Refusal by an inspector to sign the log
An analysis of current legislation showed that Order No. 18 of the State Committee of Ukraine for Entrepreneurship Development back in 1998 approved the form and Procedure for maintaining the Log of Inspections.
If one reads the Procedure carefully, paragraph 7 indeed establishes that “Before an inspection begins, a representative of the controlling body must without exception make an entry in the log, filling in all required fields, and place their signature.” Paragraph 9 clearly establishes that “refusal by the person conducting the inspection to sign the log is grounds for denying that person access to conduct the inspection.”
Let us try to reconstruct the events surrounding Tuzly Estuaries National Nature Park on the basis of the available materials:
On June 2, 2023, the Odesa Regional Directorate of the Security Service of Ukraine sent a letter to the Southern Office of the State Audit Service asking it to audit Tuzly Estuaries National Nature Park. In violation of Procedure No. 550, the leadership of the Southern Office did not return the letter, but neither did it conduct the requested audit in 2023. Instead, from September through December 2023, Southern Office staff collected information in a manner that, according to the Park’s management, clearly revealed their incompetence, and the head of Tuzly Estuaries National Nature Park informed the Ministry of Environmental Protection and Natural Resources of Ukraine about this.
To increase pressure on Tuzly Estuaries National Nature Park, on October 14, 2023, an individual wrote to a member of the Verkhovna Rada asking MP Oleksandr Tkachenko to provide public information on audits by the State Audit Service of certain aspects of the Park’s financial and economic activity starting from 2015. The individual additionally alleged incompetence on the part of Park director Iryna Vykhrystiuk, without citing any facts and relying only on assumptions.
On the same day, October 14, 2023, MPs Oleksandr Tkachenko and Antonina Slavytska sent a parliamentary appeal to State Audit Service Head Alla Basalaieva seeking information on completed financial and economic control measures, but for some reason also asked for a comprehensive review of the circumstances and facts presented and for the MPs and the applicant to be informed within the period established by Article 15 of the relevant law. Something suggests that neither the MPs nor the applicant ever received such a response.
On December 20, 2023, Order No. 299 of the Southern Office of the State Audit Service appeared, with item 1.3.5.1 providing for a scheduled audit of Tuzly Estuaries National Nature Park. The order cited exclusively the Odesa Regional Directorate of the Security Service letter as the basis for the inspection, even though that letter did not contain all information required for it to serve as a legal basis for such an audit. This apparently did not trouble the Southern Office leadership.
On March 13, 2024, Nina USENKO and Olena KARTAKAI, chief state auditors of the Department for Control in Agriculture, Ecology and Natural Resources of the Southern Office of the State Audit Service, arrived at the administrative building of Tuzly Estuaries National Nature Park.
Despite the applicable procedure requiring inspectors to register in the inspection log, the Southern Office employees refused to do so, which is a lawful ground for denying them access to conduct the inspection. Most likely, the inspectors clearly understood that they lacked lawful grounds to audit Tuzly Estuaries National Nature Park and therefore tried to avoid leaving evidence of their allegedly unlawful actions. But they presented a completely different version of events to their superiors.
Based on that version, at 17:19 on March 20, 2024, a news item appeared on the State Audit Service website presenting the Service’s version of events. At the same time, the State Audit Service conducted no oversight of the activities of its own structural subdivision, the Southern Office. On the contrary, to lend “authority” to the item, the State Audit Service referred not only to the letter from the Odesa Regional Directorate of the Security Service of Ukraine but also to an appeal by members of the Verkhovna Rada — strangely, in the singular.
Summing up the above, only one question arises: how incompetent must employees both of the central office of the State Audit Service and of its Southern Office be to violate current Ukrainian legislation so brazenly and then present it publicly as if others were the ones violating the law?
Conclusion
An analysis of the State Audit Service’s activities shows that, in our assessment, its work does not meet the requirements of its own regulations, particularly regarding implementation of state policy in the field of state financial control.
When convenient, State Audit Service specialists simply “do not see” violations and can audit public-law legal entities that were never lawfully created. When convenient in another direction, the same specialists ignore current legislation and, demonstrating complete incompetence, behave as though statutory requirements do not apply to them. In doing so, they forget that every civil servant has taken the Oath established by the Law of Ukraine “On Civil Service,” which reads as follows:
“Recognizing my high responsibility, I solemnly swear that I will faithfully serve the Ukrainian people, comply with the Constitution and laws of Ukraine, implement them, respect and protect the rights, freedoms and lawful interests of persons and citizens and the honor of the state, carry with dignity the high title of civil servant and conscientiously perform my duties.”
Unfortunately, for employees of the State Audit Service, their own interests appear to carry more weight than the interests of the state they swore to serve.
Appeal by Odesa Residents to the City Authorities
Odesa residents whose demands the city authorities have ignored for nine months directly submitted a collective letter to City Hall on May 11. The initiator of the appeal is Iryna Oleksandrivna Kostenko. On Monday, May 13, the collective letter was submitted to Odesa City Council, and on May 13–14 it was also sent electronically through the deputies’ portal to every member of Odesa City Council. Green Leaf publishes the appeal.
Text of the citizens’ collective appeal
Guided by Article 40 of the Constitution of Ukraine and Articles 1 and 15 of the Law of Ukraine “On Citizens’ Appeals,” we consider it necessary to address you to resolve an urgent issue — financing combat units of the Defense Forces of Ukraine from the city budget.
We are relatives of service members defending Ukraine from the enemy, relatives of fallen heroes, volunteers and concerned Odesa residents. We demand that the city authorities increase expenditures for the Defense Forces of Ukraine, because only thanks to our defenders can Odesa live, work, rest and even celebrate freely rather than under the Russian yoke.
At the City Council session on April 24, 2024, financing for the “Safe City Odesa” budget program was again increased by UAH 146 million, while the total allocated expenditures reached UAH 823 million and another UAH 15 million was allocated for budget loans to business entities. These budget figures show that support for the Defense Forces of Ukraine is not currently a priority for the city authorities. Moreover, not all of these funds are directed to combat units of the Defense Forces, primarily the Armed Forces of Ukraine. At the same time, our defenders are repelling the enemy amid an acute shortage of supplies, especially drones, pickup trucks, electronic-warfare equipment and other items for which their families constantly organize fundraisers. These fundraisers close very slowly, and sometimes never close because those who opened them are no longer alive. Volunteers and military families cannot cover even tens of thousands of hryvnias, while vehicles and other equipment cost from hundreds of thousands to millions. The increases in military pay by UAH 70,000 and UAH 10,000 respectively have also not been secured by law, while our defenders still fuel and repair vehicles at their own expense and are forced to buy everything from personal equipment to body armor and weapons-related equipment.
Yet for some reason the city authorities prioritize financing non-combat bodies such as the Odesa Regional Territorial Recruitment and Social Support Center, which received an additional UAH 1.8 million, bringing its total financing this year to almost UAH 5.9 million, including spending on “payment for the production of insignia and other products.” Such expenditures do nothing to bring victory over Russian aggression closer. It is also difficult to call UAH 2.1 million for the Territorial Office of the Economic Security Bureau in Odesa Oblast or UAH 5.0 million for the Territorial Office of the State Bureau of Investigation priority spending, especially since these institutions are fully financed from the State Budget.
The city authorities have the financial capacity to cover many military needs: purchase tens of thousands of drones, hundreds rather than dozens of pickup trucks and buggies, and finance domestic defense production for which military units are waiting in line and which currently exists only thanks to volunteer funds and donations from concerned civilians.
Analysis of the city budget indicators reveals the following reserves that could be directed to financing the Armed Forces of Ukraine. These are, above all:
1. Unallocated balance of budget funds, which after the April 24, 2024 session amounts to UAH 945,148,563. This amount is calculated from the opening balance of UAH 1,537,806,632, reduced by the UAH 2,000,000 working balance of budget funds and UAH 590,658,070 included in the city budget to cover the current-year deficit. The fact that these UAH 945,148,563 have remained unused for four months indicates that they are not currently needed to cover priority expenditures and can be directed to the needs of the Armed Forces without negative consequences for the city. We demand that this issue be considered and that a draft decision be prepared for the nearest session to direct the specified UAH 945,148,563 exclusively to the needs of combat units of the Defense Forces of Ukraine.
2. Unallocated funds of the deputies’ fund, which after the April 24, 2024 session amount to UAH 103,810,197. Analysis of 2023 shows that most deputies conscientiously fulfill their duty and allocate their share of the deputies’ fund in the first months of the current budget period. However, some deputies do not exercise this right, and the funds remain in the budget without serving the community. We demand that this issue be considered and that a draft decision be prepared for the nearest session to amend Odesa City Council Decision No. 37-VIII of February 3, 2021 so that, if an Odesa City Council deputy does not submit proposals for the use of their share of the deputies’ fund during the first five months of the current year, those funds are automatically directed to the needs of combat units of the Defense Forces of Ukraine. Such amendments would not only increase the accountability of Odesa City Council deputies to their voters but also help identify additional financial resources for urgent needs of combat units of the Defense Forces.
In fact, these two items alone would allow the city authorities to direct about UAH 1 billion to the urgent needs of combat units of the Defense Forces of Ukraine without harming the city’s essential operations. But this is not the limit of the city’s capacity.
Many expenditures are allocated to non-priority needs during the war against Russian aggression — such as landscaping, repairing asphalt where it could still serve for several years, and many other items, including additional bonuses for employees of executive bodies, municipal institutions and enterprises. At the same time, the salary of an ordinary specialist can exceed that of a service member.
Reducing non-priority expenditures could, according to preliminary estimates, free up approximately UAH 1.6–2.2 billion, or 15–20% of the city budget’s expenditure side excluding interbudgetary transfers and the reserve fund. If employees of executive bodies refuse to do this work or provide knowingly incorrect figures, the city’s civil society can assist with this task.
With political will and a state-minded approach, the city authorities could, without harming essential city operations but by abandoning non-priority spending, direct approximately UAH 2.6–3.2 billion in 2024 to the urgent needs of combat units of the Defense Forces of Ukraine.
Based on the above, WE REQUEST:
- Personally review this collective appeal.
- Immediately resolve the issues raised in the appeal.
- Provide a substantive response regarding each of the specified indicators
of the city budget concerning the allocation of funds to finance urgent
needs of combat units of the Defense Forces of Ukraine.