EBA urges the Verkhovna Rada to support Draft Law No. 13439-3 on increasing the size of the State Budget Reserve Fund to enable rapid responses to critical infrastructure challenges

15/ 08/ 2025

The European Business Association calls on Members of Parliament to support the provisions of Draft Law No. 13439-3, which envisage increasing the size of the State Budget Reserve Fund. Additional funds, by decision of the Cabinet of Ministers of Ukraine, may be directed to urgent measures to overcome military aggression – in particular, to restore transport connections after enemy attacks, which are currently intensifying, and to ensure the uninterrupted operation and liquidity of the Ukrainian railway operator. In the near future, the Verkhovna Rada is expected to consider, in the second reading, Draft Law No. 13439-3 of 14 July 2025 On Amendments to the Law of Ukraine “On the State Budget of Ukraine for 2025” regarding financial support for the security and defence sector and addressing urgent issues. Among other provisions, it contains measures to increase the Reserve Fund in light of growing threats to the country’s critical infrastructure. Such a decision would enable the Government to allocate resources to urgent needs in sectors essential for the functioning of the Ukrainian economy. In particular, it would allow for financial support of at least UAH 8 billion for JSC Ukrzaliznytsia, which, despite severe enemy shelling, ensures the uninterrupted operation of the railway transport system to meet the needs of the military, the economy, and the civilian population. In 2025, Ukrzaliznytsia’s losses from passenger transportation are expected to reach UAH 22 billion, as passenger tariffs remain fixed for the duration of martial law while operating costs continue to grow. In previous years, these losses were covered through cross-subsidisation from freight transportation revenues. Funds that should have been invested in infrastructure development and improvement of logistics services were instead used to offset passenger segment losses. However, with a significant decline in freight volumes due to occupation and the destruction of industry, the sources for such cross-subsidisation have been exhausted. Freight owners can no longer bear the additional burden, and their competitiveness has critically declined, particularly as many enterprises are struggling due to the full-scale war. Moreover, the business community considers such a practice economically unjustified and inconsistent with European principles of transport financing. It should be recalled that the EBA has previously made a similar appeal, which has become even more urgent in light of the carrier’s plans to index freight tariffs for shippers. In view of the above, the European Business Association urges support for Draft Law No. 13439-3, as adoption of the relevant provision will contribute to strengthening the country’s defence capability, sustaining economic activity, and fulfilling important social functions of the state without further exacerbating critical problems for the economy.

In the near future, the Verkhovna Rada is expected to consider, in the second reading, Draft Law No. 13439-3 of 14 July 2025 On Amendments to the Law of Ukraine “On the State Budget of Ukraine for 2025” regarding financial support for the security and defence sector and addressing urgent issues. Among other provisions, it contains measures to increase the Reserve Fund in light of growing threats to the country’s critical infrastructure.

Such a decision would enable the Government to allocate resources to urgent needs in sectors essential for the functioning of the Ukrainian economy. In particular, it would allow for financial support of at least UAH 8 billion for JSC Ukrzaliznytsia, which, despite severe enemy shelling, ensures the uninterrupted operation of the railway transport system to meet the needs of the military, the economy, and the civilian population.

In 2025, Ukrzaliznytsia’s losses from passenger transportation are expected to reach UAH 22 billion, as passenger tariffs remain fixed for the duration of martial law while operating costs continue to grow. In previous years, these losses were covered through cross-subsidisation from freight transportation revenues. Funds that should have been invested in infrastructure development and improvement of logistics services were instead used to offset passenger segment losses. However, with a significant decline in freight volumes due to occupation and the destruction of industry, the sources for such cross-subsidisation have been exhausted.

Freight owners can no longer bear the additional burden, and their competitiveness has critically declined, particularly as many enterprises are struggling due to the full-scale war. Moreover, the business community considers such a practice economically unjustified and inconsistent with European principles of transport financing.

It should be recalled that the EBA has previously made a similar appeal, which has become even more urgent in light of the carrier’s plans to index freight tariffs for shippers.

In view of the above, the European Business Association urges support for Draft Law No. 13439-3, as adoption of the relevant provision will contribute to strengthening the country’s defence capability, sustaining economic activity, and fulfilling important social functions of the state without further exacerbating critical problems for the economy.