The International Monetary Fund (IMF) demanded on Sunday that Ukraine's government veto a new law that raises social standards passed last week by the country's parliament, an IMF statement on Ukraine reads, UKRINFORM reports.

“An International Monetary Fund (IMF) mission headed by Ms. Ceyla Pazarbasioglu visited Kyiv to review the authorities' economic program that is being supported by a Stand-By Arrangement with the IMF. The mission found that the economic and financial situation in Ukraine is stabilizing as a result of policies under this program. Preserving these gains will require policy discipline and corrective actions in some areas,” the IMF said.

In its discussions with the Ministry of Finance and the National Bank of Ukraine, the IMF mission reached staff-level agreement on such actions, and it has departed Kyiv.

"The mission is now awaiting endorsement of the agreed policy package from the signatories to the programme - the president, the prime minister, the minister of finance, and the governor of the National Bank - including assurances that the wage and pension law approved by Ukraine's parliament, the Rada, this week, which is at odds with the objectives of the authorities' programme, will be vetoed," the IMF said. According to the Fund, the 'law was at odds with an IMF support programme'.

As UKRINFORM reported, the Verkhovna Rada passed October 20 a law setting the living wage and minimum wage submitted by Bloc of Lytvyn MP Oleh Zarubinsky.

The document sets from November 1, 2009 the living wage per capita for a month at UAH 701, January 1, 2010 - UAH 825, April 1 - UAH 839, July 1 - UAH 843, October 1 - UAH 861, December 1 - UAH 875.

The instrument also sets the minimum wage: from November 1, 2009 - UAH 744, January 1, 2010 - UAH 869, April 1 - UAH 884, July 1 - UAH 888, October 1 - UAH 907 and from December 1 - UAH 922.

Today, the minimum wage makes UAH 669 and the minimum living is UAH 626 (USD 1 - UAH 7.99).

The Bloc of Yulia Tymoshenko (BYuT) asked President Viktor Yushchenko not to sign the law on a rise in social standards. BYuT faction leader Ivan Kyrylenko noted that if the law comes into force, this could cause inflation, the hryvnia's devaluation, or a number of development programs would have to be closed.

According to Ukrainian Deputy Finance Minister Volodymyr Matviychuk, there are currently no non-inflation sources of financing a rise in the living wage and the minimum wage in the country. He said that an additional UAH 8 billion would be required this year and UAH 71 billion next year in order to implement the law on a rise in social standards.

Matviychuk added that Ukraine would have to print uncovered money or dismiss 1.6 million people in the budget sector.

For his part, First Vice Premier Oleksandr Turchynov said earlier that the adoption of the law on a rise in social standards could bring the full destruction of Ukraine's financial system.


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