In Ukraine, now in its fifth year of full-scale war, there is effectively no clear ‘security contract’ between the state and local communities. Local authorities are spending billions of hryvnias on defence, but are doing so without clearly defined rules and powers. Meanwhile, for almost two years now, the President has failed to sign a law that would regulate these powers. Ukrainian local authorities are purchasing drones, equipment and vehicles, and channelling subsidies. At the same time, they are juggling this support with their core responsibilities: paying salaries, providing social services and maintaining critical infrastructure.
“If the Defence Forces are unable to protect us, then budgets for local needs will no longer be of any use to anyone,” remarks the veteran, Knight of the Order of Bohdan Khmelnytsky and chairman of the board of the non-governmental organisation ‘League of Interns’, Mykola Melnyk.
The desire to allocate more funds to the country’s defence sounds emotionally compelling, but are there any specific details as to which items in local budgets are suitable for this purpose? Let’s try to work out how money from towns and villages is being ‘allocated’, and whether local authorities find themselves in a situation where they have de facto become donors to the security sector, but de jure lack clearly defined powers to do so.
In fact, this is not just about budgets, but about the effectiveness of defence: how quickly and accurately funds reach the military, and whether these resources are being lost due to administrative uncertainty. And this is no longer a matter of bookkeeping, but of the speed and efficiency with which the front line is supplied.
Communities as a financial base
According to the second wave of a study on local authorities’ expenditure on defence measures, carried out by analysts at the Centre for Innovation Development, in 2025 local authorities allocated more than 10% of their budgets to defence and security, amounting to over 14 billion UAH. These figures were provided to the researchers during a survey of 223 local authorities.
The figures given reflect only the data shared by local authorities in response to a request from analysts. Responses were received mainly from smaller local authorities, which thereby demonstrated their openness to communication. In contrast, either no responses were received from regional centres and large cities, or local authorities refused to provide information, citing the legal framework of martial law. Consequently, the overall figures for the country may be significantly higher.
The study by the Centre for Innovation Development covered a wide range of security-related expenditure. This includes funding for territorial defence programmes, transfers of subsidies to the state and regional budgets for the needs of the Defence Forces, the reconstruction of facilities destroyed by missile strikes, the fitting out of shelters, and assistance to victims and internally displaced persons.
The largest amount of funding was spent under the programme to support territorial defence. This includes the procurement of UAVs, quadcopters, FPV drones, electronic warfare equipment, computer and navigation equipment, vehicles, body armour and thermal imaging devices. This amounts to 6.8 billion UAH, the highest figure since the start of the full-scale invasion. 3.2 billion hryvnias were returned to the state and regional budgets in the form of grants to support military units.
In 2025, significant sums under this programme were allocated to 28 communities in the Khmelnytskyi region (1.4 billion UAH), three communities in the Vinnytsia region (1.3 billion UAH), and 25 communities in the Kharkiv region (1.03 billion UAH).
Analysts at the Centre for Innovation Development, in analysing local authorities’ expenditure, deliberately did not set out to rank those that provide the most support. Instead, grouping the data by region makes it possible to assess in which regions local authorities are more open to communication and able to clearly indicate which programmes they are channelling their funds towards and what challenges they face in doing so.
Help in the “grey zone“
Despite the substantial figures cited in the study by the Centre for Innovation Development, they are still unable to allocate a significant portion of their budgets to supporting the Community Defence Forces, as they must first and foremost ensure that essential expenditure items are covered, in particular salaries, utilities and social protection.
This is emphasised by Victoria Muzalevska, Head of the Finance Department at the Pivdenne City Council in the Kharkiv region, during a survey conducted by the Centre for Innovation Development:
“Our community relies on subsidies, so, unfortunately, we lack the funds to meet the needs of our servicemen and women as fully as possible. We have limited financial resources, and on top of that, there has been a pay rise for social workers and teachers this year, which has left us with even fewer options.“
Under current legislation, local authorities have only three tools at their disposal to support the Defence Forces: funding volunteer units within local communities, transferring grants to the state and regional budgets, and investing in military bonds. Direct support for units of the Armed Forces is limited and often depends on formal procedures and requests.
However, none of the existing mechanisms enable local authorities to respond swiftly and fully to requests from military units, for example regarding the procurement of individual electronic warfare systems or other equipment. As a result, some of the military’s requests are processed with delays or not processed at all — not due to a lack of funds, but because of the complexity of the procedures and the legal risks involved.
In wartime, such a delay can mean a loss of time, which at the front is measured not in days, but in opportunities.
Although, in practice, local communities are involved in supporting the military. Indeed, in the Vinnytsia region, they are doing their utmost to help.
“Local authorities support the military through grants and the provision of equipment in response to requests from military units. We are in constant contact with the military to ensure their needs are met promptly,” says Natalia Zabolotna, head of the Vinnytsia Regional State Administration.
The military are also receiving active support in the Khmelnytskyi region.
“We allocate a minimum of 500,000 UAH to every military unit that applies. For some units, the amounts were even higher, depending on the request and the troops’ location. It was not always possible to make the full purchase due to the high cost. However, we tried to provide support to all military units where members of the local community are stationed. No requests were turned down,” says Valentyna Kravchuk, head of the finance department of the executive committee of the Netishyn City Council in Khmelnytskyi Oblast.
Olena Chelpan, Deputy Director of the Finance Department at Chernivtsi City Council, adds:
“Of course, we would like to help as much as possible. We provide support to the armed forces in accordance with existing targeted programmes. This concerns military units stationed or formed within the community. We respond to all requests either by purchasing the equipment required by the armed forces or by channelling a grant to the state budget to meet the units’ needs.“
There is a potential risk lurking behind the desire to help. Direct purchases for military units may be interpreted as a breach of budgetary legislation, and proceedings are being brought against local officials for the ‘misuse of funds’. Cases of mayors being accused of misusing funds have been documented by activists from the anti-corruption movement ‘Chesno’.
Why did the problem arise?
Legal uncertainty stems from the process of redistributing powers between the central government and local communities in the context of the war. On the one hand, decentralisation has given local communities financial capacity and autonomy. On the other hand, the full-scale war has objectively strengthened the role of the central government, as defence is the state’s responsibility.
In 2023, the state withdrew the ‘military’ personal income tax from local budgets and revised the system of inter-budgetary transfers. This has shifted the balance of resources and influence. The Ukrainian Ministry of Defence focuses on meeting the military’s strategic needs and is unable to respond swiftly to specific challenges faced directly by brigade units; consequently, requests from these units are passed on to local authority leaders. The transfer of funds via subventions is a rather lengthy process, as the money only reaches the military from the local authority after tenders have been held, equipment sourced and all procurement procedures completed. This creates a situation where local authorities have the resources and the political will to support the military, but lack fully legalised tools to do so.
On 18 June 2024, the Verkhovna Rada adopted the draft law ‘On Amendments to the Law of Ukraine “On Local Self-Government in Ukraine” regarding the expansion of the powers of local self-government bodies during the period of martial law’ (No. 9559-d), which was intended, in particular, allow communities to legally provide financial and material support to the security and defence sector.
The document provided that village, town and city councils were to be granted the power to take decisions on providing financial and material support to the security and defence sector during a state of war or a state of emergency. In addition, they were to be granted the right to approve local programmes aimed at providing logistical support to the Armed Forces of Ukraine.
However, the document has not yet come into force: it has been awaiting the President’s signature for almost two years.
‘It has been two years since Bill No. 9559-d, which we passed in parliament, was submitted to the President for signature. The cost of this failure to sign and this delay is measured in the lives of our servicemen and the square kilometres of occupied territory. Bill No. 9559-d concerns the source of funding for waging war in the face of a budget deficit. A source over which neither Trump, nor Starmer, nor Macron, nor Putin, nor anyone else has any influence. These are our domestic resources. In 2024 and 2025, local authorities allocated up to 50 billion hryvnias to the Defence Forces in one form or another, at their own risk. Although the law legalising such ‘donations’ has not yet come into force, as the President has not signed it. Local authorities are ready to provide billions of hryvnias to meet the needs that the state is unable to cover in time. Billions of hryvnias could be put to work for Victory, rather than being spent on unnecessary paving,” — notes one of the initiators of Bill No. 9559-d — Member of Parliament Roman Lozynsky.
At the same time, according to those interviewed, this delaying tactic on the part of the Presidential Administration is allegedly driven by a desire to retain control over defence spending and avoid chaotic procurement that could prove ineffective or duplicate government programmes. However, the bill has already been passed by parliament, and the consequences of it not being signed are becoming increasingly apparent.
Our partners — the ‘Golka’ civic initiative — have submitted a request to the President of Ukraine asking him to explain the reasons for the delay in signing Law No. 9559-d. At the time of writing, no response to the request had been received, although all the deadlines have already passed.
Until legislation clearly defines the powers of local authorities regarding support for the Armed Forces, expenditure from local budgets on defence procurement remains in a ‘grey area’, and supervisory bodies may regard it as a misuse of funds. Officials, meanwhile, risk facing administrative or even criminal liability.
The signing was intended to establish mechanisms whereby local communities would be granted greater powers to support the armed forces. Instead, the fact that the decision remains up in the air indicates, at the very least, a lack of political clarity regarding how exactly the state views the role of local government in supporting the Defence Forces.
As independent local self-governing bodies, communities must retain the right to make decisions on the use of funds at local level, including in the area of defence support. This refers to the ability to set funding priorities for the armed forces without centralised diktats. At the same time, such autonomy also entails full responsibility for the decisions taken, rather than the formal channelling of resources in the form of grants to the state budget, as is currently the case.
The question of the role of local communities in defence funding therefore remains unresolved. Either the state establishes clear rules and defines the limits of responsibility, or local communities will continue to operate in a ‘grey area’ — with resources, but without the necessary powers. In war, such uncertainty costs not only money, but also time, which in war often means lives.
Mykhailo Leichenko, written especially for “Dzerkalo Tyzhnia“