Decentralization is the process of transfer of power and resources from the state to the local self-government, so that governance solutions are closer to people and are more easily influenced by them.

The core of decentralization reform in Ukraine is: the executive bodies and local self-government are finally working on matters that are “natural” for them, and people have the opportunity to “build” the local self-government bodies of their community, rayon (subdivision of oblast), and oblast (province), through elections. The local self-government bodies of a community, rayon, oblast, receive the responsibilities, as well as the accompanying resources. They are responsible to the constituency for the quality of their work, and to the state – for its legality.

The reform of decentralization in Ukraine was launched in 2014, and is commonly known now as the reform of local self-government.

The key document that put the start to the reform was the Concept of the Reform of Local Self-Government and Territorial Organization of Power, approved by the Government on April 1st, 2014. The important steps of the reform were adopting a legislative package on decentralization and making relevant amendments to the Constitution of Ukraine. Regretfully, due to political reasons, the amendments to the Constitution were not made at that time, and as of 2020 they are still to be made and are widely discussed.

Nevertheless, in 2014 the decentralization continued under the current Constitution. The financial decentralization was brought up by amending the Budget and Fiscal Codes of Ukraine, providing the basis for local budgets to increase from UAH 68,6 billion to UAH 234 billion between 2014 and 2018. The Law "On Voluntary Amalgamation of Territorial Communities", adopted in 2015, put the start to amalgamation of communities. Since then, 1029 amalgamated territorial communities (ATCs) have been formed, and 11,7 million (33%) of Ukrainian citizens are now living in ATCs. The same Law created the basis for the new institution of “starosta” (village leader) – an elected position to represent a specific village - part of an amalgamated community in its Council, strengthening the democratic processes in local self-government.

The Law "On Cooperation of Territorial Communities" established the mechanism of dealing with common matters faced by communities, such as waste management and infrastructure development etc. The inter-municipal cooperation was thus strengthened, and jointly with other Laws in the legislative package created ground for formation and development of sustainable communities in Ukraine.

Based on the Law "On Fundamental Principles of the State Regional Policy", the government support for regional development and the development of infrastructure in communities increased by 41,5 times between 2014 and 2018, up to UAH 19.37 billion in 2018, covering more than 10 thousand development projects. The Ministry of Communities and Territories Development gained oversight of the State Regional Development Fund in 2015 and became its main fund manager in 2016, which pushed the Fund to be reformed and effectively support communities which were actively amalgamating at the time. Also, the Regional Development Agencies were established in 21 oblasts, as well as the Local Government Development Centres that operate in all oblasts assisting the local authorities in implementing regional strategies, among other things.

Another package of laws, stipulating enhancement of powers of local self-government bodies and the optimization of administrative services provision, allowed the delegation of powers to provide administrative services by local self-government bodies of respective levels. Individuals registration at the place of residence, issuance of national identity documents, state registration of legal entities and individuals, entrepreneurs, associations of citizens, civil registration, registration of proprietary rights, dealing with land issues, etc, are now processed at new and modern Administrative Services Centres, erasing the citizens’ revulsion towards centralized and complicated Soviet administrative service practices.

The reform of local self-government thus proved itself to be “one of the most successful of all reforms in Ukraine”, as it was said by Hugues Mingarelli, Head of the EU Delegation to Ukraine in 2016-2019. Despite the turbulences inherent to any reformation process, the all-Ukrainian consolidation, the drive for sustainable development of communities and regions, and the desire to develop quality services for citizens, pushed the reform further.

In 2015, the governmental web portal on decentralization was established. The Decentralization portal is now the key source on the reform, also available in English.

The second stage of the reform was initiated by the Government on January 23rd, 2019, and is pertained to the anchoring of achieved results and amalgamation, making changes to the territorial organization of communities and rayons, clearing up distinction of authorities and functions of different levels of governance, as well as developing local democracy.

The call to amend the Constitution of Ukraine was made again, now based on the developments since 2014, and the need for adopting a consequent legislative package was brought up. The Law “On Ground of Administrative and Territorial Organization of Ukraine”, the “Regulation of Municipal Building”, the “Amendments to the Law on Civil Service in Local Self-Government Bodies”, the legislation documents on state control of legality of local self-government bodies, on local referendum, on local elections, etc, have to be adopted.

As a result, the local elections in October 2020 should be held on a fully reformed administrative and territorial organizational basis, which would mean the end to the reform. At this time the authorities of different governance levels should be clearly defined, and the citizens should operate mechanisms of influence on the local self-government and participate in decision-making processes.