Development of governmental social insurance during the 1990’s

K. Nikolaets


Introduction. After the collapse of the USSR and the restoration of the Ukrainian statehood during the 90’s of the 20th century Ukraine was forced to make efforts to get out of the hard and long-lasting economic crisis that influenced the social politics. The first conditions, in which social-economical transformations took place, were the hardest in Ukraine compared to other post-communistic countries, except some that had ethnic conflicts. Ukraine had high inflation rates, budget deficits and falling production volumes.

Purpose. The purpose of the article is to determine the main factors that influenced the development of state social insurance in Ukraine in the 90’s of the 20thcentury.

Originality. During the 90’s of the 20thcentury the market of social services was not created in Ukraine. A priority activity was the financing of the existing network of social institutions based on cost principles. Non-governmental organizations did not have access to the services in the framework of the social order. Cooperation with charitable and religious organizations remained poorly developed. Possibilities of self-financing in the provision of social services were not used enough. In fiscal policy of the state the weighted rate changed by conjectural measures. This behavior of the state can remind one of the actions of a philanthropist spending personal money. The social policy implemented by the states from the position of a patron can make it lose its focus or manifest spontaneously in the behavior of officials who act according to their own understanding of the situation. In Ukraine the overall social budget was not determined, there was no practice of the construction of all actual expenditures on social services due to different funding sources.

Results. Between the Ukrainian scientists are advocates of making new institution of social insurance – insurance for nursing the lonely old people, invalids and for other categories of people that need regular help in their houses. In theirs opinion, it will assist the solving of the social problem that took place due to the ageing of the Ukrainian people. The opponents say that Ukraine lacks economic and legal prerequisites for doing this. The remaining main tasks in the social sphere are the creation of market mechanisms for the system of social services, expanding the choice of services by people, diversification of the form of services provision based on active involvement of the non-governmental sector, which have to become a key factor in regional social politics, whereas new developments need to support the traditional role of family, at the same time giving financial and social support for taking care of old people, providing social services for such people who can’t maintain themselves or get help from relatives, in order to avoid sending them to nurcing homes. It is the more important in view of the Ukrainian transition from typical big families (consisting of several generations living together) to nuclear ones (parents and children live independently), that reduces the possibility of providing care to the elderly people.

Conclusion. Upon the condition of ensuring economic growth through the introduction of innovative technologies, the prospects of enhancing the role of state social insurance social policy are quite likely. For further constructive development of the state social insurance it is necessary to take comprehensive measures to popularize its efficiency and take real steps in ensuring the maximum possible benefits.


pension, social governmental insurance, reforms, taxes, government, demography situation, economic crisis


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