LIVING STANDARDS INDICATORS: ASSESSMENT AND IMPACT ON SOCIAL POLICY FINANCING

Abstract

The article provides a comprehensive analysis of state financial policy in the field of social protection and security under wartime economic conditions in Ukraine. It is substantiated that full-scale armed aggression has caused systemic socio-economic transformations, increased social risks, and a decline in purchasing power, complicating the fulfillment of state obligations amid limited fiscal capacity and heightened uncertainty.
The dynamics of basic social standards–the subsistence minimum, minimum wage, and minimum pension–alongside inflationary processes and macroeconomic variables during 2021–2024 are analyzed. A significant lag of nominal growth in social guarantees behind inflation rates is identified, leading to decreased real incomes and expanded poverty. Key financial imbalances are revealed, including the artificial restraint of standards, insufficient targeting of benefits, and increasing dependence on external financing.
Special attention is devoted to the impact of macroeconomic factors, such as GDP recovery and rising production costs, on the state’s capacity to ensure social guarantees. The study demonstrates that these factors constrain social expenditures, highlighting the need to optimize budget planning.
The necessity of shifting from a compensatory model to a pragmatic financial policy is substantiated. This approach focuses on improving expenditure effectiveness, strengthening targeting, digitalizing payment processes, and implementing impact evaluation mechanisms. The findings emphasize integrating living standard indicators into financial decision-making, considering wartime risks and post-war transformation objectives.