Institutional framework for managing the finances of territorial communities: trends, threats and imperatives of public policy

doi:10.26565/1992-2337-2025-1-27

Nazar Kosarevych Ivano-Frankivsk National Technical University of Oil and Gas, 13 Korolya Danyla Str., Ivano-Frankivsk, 76010, Ukraine https://orcid.org/0009-0004-9840-9732

DOI: https://doi.org/10.26565/1992-2337-2025-1-27

Keywords: institutional framework, community finance, public policy, fiscal decentralization, fiscal autonomy, financial management, strategic planning.

Abstract

The article investigates the institutional framework for managing the finances of territorial communities in the context of transformational changes caused by military challenges, economic instability and the need for post-war reconstruction of the country. Attention is focused on the evolution of management approaches in the field of local finance, the role of public policy in shaping a favorable institutional environment, and the main trends and contradictions affecting the financial capacity of communities are identified.

The author analyzes the current state of regulatory and legal support for local finance management, outlines the problems of coordination between central and local authorities, the level of efficiency of intergovernmental fiscal equalization mechanisms, the lack of fiscal decentralization and the risks of fragmentation of the budget system under martial law. The author determines that the key threats to institutional stability are the weakening of community autonomy, uneven resource provision, and inconsistency of strategic development goals with the financial capabilities of local budgets.

Particular attention is paid to the imperatives of public policy in the field of local finance management. The author proposes conceptual guidelines for institutional reform: strengthening the fiscal autonomy of communities, introducing medium-term budget planning with due regard for local development strategies, increasing the transparency and accountability of local governments, and strengthening the role of public participation in financial decision-making. The author concludes that it is necessary to systematically update the institutional architecture of financial management of territorial communities as a prerequisite for the effective implementation of the State regional policy and sustainable socio-economic recovery of the country.

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Author Biography

Nazar Kosarevych, Ivano-Frankivsk National Technical University of Oil and Gas, 13 Korolya Danyla Str., Ivano-Frankivsk, 76010, Ukraine

PhD in Economics, Doctoral Candidate, Department of Public Management and Administration, Ivano-Frankivsk National Technical University of Oil and Gas

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