The draft state budget 2011, which has been approved by the Cabinet of Ministers on Wednesday, envisages the consumer price index (inflation) in 2011 at 8.9 percent, Premier Azarov said in is opining speech at the Cabinet's session.

"I want to emphasize that the Finance Ministry and the Government in general were working continuously on the budget project since almost the moment when we came to power. However, without a new tax legislation the Government could not complete work on this for our state crucial document," Mykola Azarov said.

Therefore, according to the PM, the delay in Budget's adoption and implications for the state and citizens is on the conscience of those who interfered in time to take vital decisions for the state.

The Premier noted that the government and parliament should pass the budget process in a very short time, so that the country enters the New Year with a precisely defined plan of action. And so that from the first day of 2011 we laid the foundations for sustained economic and social sphere development.

"Budget 2011 is the reform budget. It was formed on the basis of the new Budget Code, which strengthens the financial viability of local budgets. The budget revenue is calculated based on the provisions of the Tax Code, and is subject to reduction of administrative barriers of doing business," Azarov said.

According to him, the draft budget for next year is charged not only with the measures to restore  national economy and to ensure adequate social protection, but also to ensure the economic reform program of the President of Ukraine.

"We continue a balanced increase in the size of a living wage and minimum wage. In accordance with the inflation rate we will increase the size of scholarships, allowances to families with children, children with disabilities, large families and others," Azarov stressed. He also added that maternity aid will rise 1.6-fold, and almost 20% increase in financial resources are allocated for the provision of benefits and housing subsidies to the population. In addition, capital budget expenditures will grow 2.3 times.

According to the prime minister, the funds of the budget next year will be focused on key areas aimed at encouraging investment and innovation growth of the economy. In particular, they will be channeled to finance the program on preparations for the 2012 UEFA European Football Championship, national projects, the development and introduction of promising new technologies and to support projects aimed at improving energy efficiency and conservation. Azarov stressed that these programs and projects that will be provided from the state budget are calculated with the possibility of their extension in the medium and long term prospects.

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