Ukraine - Public Expenditures for Administrative Capacity Endurance (PEACE) in Ukraine : Tenth Additional Financing

Overview & Synopsis

The development objective of the Public Expenditures for Administrative Capacity Endurance (PEACE) in Ukraine for Ukraine is to contribute to sustaining the government administrative and service delivery capacity to exercise core government functions at the national and regional levels. The proposed additional financing responds to the ongoing fragility, conflict, and disaster context by scaling up support to sustain essential non-military public expenditures, closing a financing gap, and extending continuity of critical services and social transfers through December 31, 2027, thereby mitigating humanitarian and poverty impacts, preserving human capital, and maintaining confidence in the Government of Ukraine’s (GoU) capacity to deliver while laying foundations for reconstruction and European Union accession. The Bank will continue to support: payment of salaries for non-security sector government employees, pedagogical and higher education employees; financing of pensions; maintenance of key social assistance programs including the Guaranteed Minimum Income, Housing Utility Subsidy, Disability, Internally Displaced Persons, and Family with Children programs; salaries of healthcare workers through the Program of Medical Guarantees; and salaries of first responders. The project intends to accomplish sustained and timely delivery of core services and transfers nationwide by using government systems for execution and reporting, enhanced verification through Agreed Upon Procedures and independent audits, and continuous beneficiary feedback via the Listening to Ukraine surveys and functional grievance redress mechanisms. Since launch, the operation has helped maintain continuity of services and transfers to 9.2 million pensioners, about 450,000 education employees and 4 million students, 126,000 government employees, 54,000 first responders, more than 14 million healthcare patients, 4 million social assistance beneficiaries, and 1.8 million internally displaced persons, with 99.6 to 99.7 percent of pensioners and over 90 percent of social assistance beneficiaries receiving payments on time despite security and logistical constraints; 11,941 schools and 1,999 health service providers remained operational as of June 2026; and salaries for eligible education, government, and school employees were paid in full. By sustaining budget execution for these essential functions and protecting vulnerable groups, the additional financing will continue to limit irreversible losses in human capital, support macro-fiscal stability through predictable social spending, and safeguard the institutional capacity necessary for recovery and reform.