Deputy Prime Minister Chentsov has instructed the Ministry of Finance to consider Mykolaiv’s request for an additional grant of ₴1.18 billion

Vsevolod Chentsov, Deputy Prime Minister for Ukraine’s European and Euro-Atlantic Integration, has instructed the Ministry of Finance and a number of other departments to consider the request from Mykolaiv City Council for an additional grant from the state budget and to submit proposals. The city is requesting 1.18 billion hryvnias to cover priority expenditure in 2026.

This is stated in the Cabinet of Ministers’ response to the letter from the Mykolaiv City Council dated 7 August. The document is in the possession of the editorial team at NikVesti.

The document states that the request is to be considered by the Ministry of Finance, the Ministry of Community and Territorial Development, the Ministry of Recovery, the Ministry of Health and the Ministry of Social Policy. The Mykolaiv Regional Administration and the Military Administration have also been involved in the review.

The Deputy Prime Minister has instructed that the request be considered and that the Mykolaiv City Council and the Cabinet of Ministers be informed of the results. «If necessary», the departments are to submit relevant proposals in accordance with the established procedure.

What Mykolaiv is requesting the money for

On 6 August, the Mykolaiv City Council appealed to the Verkhovna Rada and the Cabinet of Ministers for an additional grant from the state budget. The city is requesting 1.18 billion hryvnias to cover the local authority’s budget deficit in 2026.

The appeal states that the additional funds are needed, in particular, for:

• paying salaries to public sector employees — 169.9 million hryvnias;
• paying for utilities and energy — 133.5 million hryvnia;
• providing meals for children from disadvantaged groups in educational institutions — 65.8 million hryvnias;
• compensation for subsidised travel for certain categories of citizens — 15.3 million hryvnias;
• paying cash compensation to students at vocational educational institutions — 9 million hryvnias;
• resolving drinking water issues and ensuring the uninterrupted operation of the heating supply system — 784.5 million hryvnias.

The city council attributes the need for additional funding to a decline in budget revenue. In particular, due to changes in budgetary legislation and the removal of personal income tax from the salaries of military personnel and law enforcement officers, the city budget will have a shortfall of 2.7 billion hryvnias in 2025, and is expected to lose around 3 billion hryvnias in 2026.

Furthermore, the appeal notes that the scaling back of operations by major taxpayers and the relocation of businesses to other regions have also reduced the city budget’s revenue.

The City Council emphasises that additional financial support is needed to ensure the functioning of housing and communal services, social and critical infrastructure, as well as the fulfilment of state social guarantees.

The city authorities have been discussing the budget deficit issue since the start of the year.

Back in January, Mykolaiv’s mayor, Oleksandr Sienkevych, stated that the city needed approximately 1.1 billion hryvnias from the state budget. In May, the city council again appealed to the Cabinet of Ministers for an additional grant.

On 6 August, councillors once again backed the request — this time for 1.18 billion hryvnias.

Oleksandr Sienkevych explained at the time that the repeat request was linked, in particular, to the lack of a response from the Ministry of Finance and the Cabinet of Ministers.

«We reached this decision as a result of the lack of feedback from the Ministry of Finance and the Cabinet of Ministers. It was also due to the change in the composition of the Cabinet of Ministers and the appointment of a new Prime Minister. We are raising this issue once again regarding a situation that has not changed in any way since December 2025, when we were planning the budget with you. We are appealing to them once more and, as they say, we now have more representatives from the Mykolaiv region in this Government. We very much hope that they will help us secure this grant, if not in full, then at least in part. However, it would be preferable for all matters relating to the grant to be funded,» said the mayor.

Meanwhile, on 6 August, Mykolaiv City Council found nearly 45 million hryvnias to co-fund the installation of modular boiler houses. These funds became available thanks to the budget’s revenue side exceeding targets for January to July. According to the Department of Finance, revenue performance over the seven-month period stood at 110.6 per cent.

However, these 44.95 million hryvnias do not solve the overall deficit problem.

The money will be allocated as a 10 per cent co-funding contribution to the state programme for the installation of modular boiler houses in Mykolaiv. The total cost of the project is around 450 million hryvnias, of which around 400 million is to be provided by the state. The boiler houses are intended to serve as a backup source of heat in the event of disruptions to the centralised heating supply.

Budget shortfall in Mykolaiv

The city authorities have been discussing the budget deficit since the start of the year.

Back in January, Mykolaiv’s mayor, Oleksandr Sienkevych, stated that the city needed around 1.1 billion hryvnias from the state budget. In May, the city council again appealed to the Cabinet of Ministers for an additional grant — this time amounting to 1.18 billion hryvnias.

Oleksandr Sienkevych explained at the time that the repeat request was due, in particular, to the lack of a response from the Ministry of Finance and the Cabinet of Ministers.

«We reached this decision as a result of the lack of feedback from the Ministry of Finance and the Cabinet of Ministers. It was also due to changes in the composition of the Cabinet of Ministers and the appointment of a new Prime Minister. We are raising this issue once again regarding a situation that has not changed in any way since December 2025, when we were drawing up the budget with you. We are appealing to them once more and, as they say, we now have more representatives from the Mykolaiv region in this Government. We very much hope that they will help us secure this grant, if not in full, then at least in part. However, it would be desirable for all matters relating to the grant to be funded,» said the mayor.

Meanwhile, on 6 August, Mykolaiv City Council found nearly 45 million hryvnias to co-finance the installation of modular boiler houses. These funds became available thanks to the budget’s revenue exceeding the target for January to July. According to the Department of Finance, revenue performance over the seven-month period stood at 110.6 per cent.

However, these 44.95 million hryvnias do not resolve the overall deficit problem. The money will be allocated as 10 per cent co-funding for the state programme to install modular boiler houses in Mykolaiv. The total cost of the project is around 450 million hryvnias, of which around 400 million is to be provided by the state. The boiler houses are intended to serve as a backup heat source in the event of disruptions to the centralised heating supply.

Why, in this context, is the city not spending part of the planned funds?

Against the backdrop of a municipal budget deficit, certain departments of the city council are simultaneously showing low budget execution rates. In particular, as of 1 August, the Capital Construction Department had spent 22 million hryvnias out of the 234.6 million hryvnias allocated for the year. This represents just 9.5 per cent of the department’s budget — the lowest figure among the city council’s departments.

On 4 August, Oleksandr Sienkevych asked the deputy mayor, Serhii Korenev, who coordinates the work of the Capital Construction Department, to report on the implementation of infrastructure projects.

The mayor himself attributed the low budget execution rate to the fact that the city is delaying payment for completed capital works due to a lack of funds. According to him, work on individual sites is approximately 40 per cent complete, but the city has not yet made the corresponding payments.

Dmytro Falko, Secretary of the Mykolaiv City Council, stated that Mykolaiv could run out of funds for some of its priority expenditure as early as November–December if the city does not receive additional funding from the state budget.