04 Oct International Bureaucracy Day in Ukraine: First step to reduce bureaucratic burden on small businesses
On October 1st the results of the Bureaucracy Index for Ukraine were presented in Ukrainian Crisis Media Centre. Presentation was held within International Bureaucracy Day. The results of the Bureaucracy Index 2018 for East-Central Europe were presented during the event.
Despite the fact that the number of mandatory bureaucratic procedures that the company must perform during the year in Ukraine is roughly equal to that of European countries, it takes us twice as long to complete these procedures. So, if in Lithuania a small business spends about 252 hours to fight the bureaucracy, 233 in the Czech Republic and 222 in the Czech Republic, then Ukrainian businessmen are forced to spend 469 hours a year to fill out unnecessary documents. In monetary terms, bureaucracy costs small business more than one thousand euros.
“A lot of people consider bureaucracy as a real obstacle to the functioning of small businesses. However, it is difficult to fight with it. The main reason is that for most of people bureaucracy is a fictional term that is not measured by quantitative indicators. In order to change this situation, the EasyBusiness team developed Bureaucracy Index – a simple and transparent tool that allows quantifying the negative impact of the bureaucracy on the company’s activities during the year by calculating the time and money needed to carry out bureaucratic procedures,” – said Andrew Shpakov, CEO of EasyBusiness .
“At this stage, we have a detailed list of bureaucratic procedures with accurate information about the costs involved in these procedures. This is a very good base for public authorities, because they can see where exactly there is the largest bureaucratic pressure and create the appropriate rules to combat with it “, – said Kateryna Shapovalenko, Economic Analyst of EasyBusiness.
As the authors of the study pointed out, the time and money lost in bureaucracy could be used for business needs: hiring a salesperson, optimizing business processes, or creating their own website for online customer engagement.
After the presentation, the results of the Index and further prospects for reducing bureaucratic pressure on small businesses in Ukraine were discussed among representatives of executive authorities, business associations and civil society.
Restarting the state today on other principles than bureaucracy is impossible, but what is possible – reducing the influence of bureaucracy.
“The bureaucratic pressure on business is not only a Ukrainian problem, it is also present in European countries. But this is not about the number of papers to be filled, but the level of bureaucratic pressure in terms of time and money spent on bureaucratic procedures,”- commented Ksenia Lyapina, Head of the State Regulatory Service of Ukraine.
“Real steps to ease the bureaucratic burden for small businesses can be implemented. Changes should be made in the legislation. The most difficult thing in this situation is to communicate such an initiative in the parliament,” -said Dmytro Romanovich, Expert on deregulation and improvement of the business climate.
Despite understanding of the importance of reducing the bureaucratic burden, participants in the discussion noted that a certain level of bureaucracy should be present. After all, it “supports certain standards of public administration and provision of services. Bureaucracy should facilitate business life. At the moment, we need a reform of the bureaucracy of the civil service, which could have a positive impact on the bureaucracy index in Ukraine, “said Artem Shaipov, Chairman of Professional Government Association
Experts and official representatives who participated in discussion:
- Andrew Shpakov, CEO of EasyBusiness
- Kseniya Lyapina, Head of the State Regulatory Service of Ukraine
- Kateryna Shapovalenko, Economic Analyst of EasyBusiness
- Vyacheslav Bykovets, Director General of the Union of Small Enterprises of Ukraine
- Valentyn Khokhlov, Certified Financial Analyst, Member of the Professional Government Association
- Artem Shaipov, Chairman of Professional Government Association
- Dmytro Romanovich, an Expert on deregulation and improvement of the business climate
Video of the discussion is available below.
To find out more visit the official website of the Index.