No cuts to pensions or salaries: Cabinet redirects 70 billion in budget savings to defense

Budget Savings

According to ХВИЛЯ: Ukraine's wartime budget requires balancing military needs with social stability. Prime Minister Serhiy Koretskyi has announced a strict cost-saving policy for all state spending not tied to defense. The government says 70 billion in savings have already been identified, with the full amount being allocated to defense. He emphasized that social benefits, pensions, and salaries will not be affected.

Addressing parliament on Tuesday, Koretskyi stated:

“The government is imposing a strict economy regime on budget funds not earmarked for defense. We have already generated 70 billion in savings, and all of it will be directed to defense needs.” - Serhiy Koretskyi

He also gave assurances about pensions and wages:

“At the same time, we must meet all necessary social obligations. So there will be no problems with pensions or salaries.” - Serhiy Koretskyi

Looking Ahead

The Cabinet intends to apply this principle in preparing the 2027 state budget. Koretskyi called on lawmakers to take an active role in shaping the 2027 budget. Earlier reports indicated he was seeking additional resources for the army before the end of the year. It was also noted that Minister Svyrydenko had announced record defense spending in the 2026 budget.

This cost-cutting push highlights the priority given to defense funding in the face of security challenges. The government's effort to preserve social payments may reflect a desire to maintain domestic stability. Applying austerity principles to the 2027 budget could also signal a long-term approach to controlling state spending.

As the government prioritizes defense funding, it has implemented strict measures to control spending across other sectors. This approach not only aims to bolster military capabilities but also reflects a commitment to maintaining social stability. For a deeper understanding of these spending restrictions and their implications for the armed forces, you can read more about the government's budgetary changes here.