Ukraine’s soldiers face drastic wage cuts as austerity bites
Salary cuts will have a negative impact on their morale, preparedness and medical treatment, say soldiers
Ukrainian soldiers have told openDemocracy that a new salary structure, introduced under the extreme economic pressures of Russia’s war, is leaving them unable to buy combat essentials or pay for medical treatment.
As Russian forces bore down on Kyiv in February 2022, President Volodymyr Zelenskyi promised soldiers extremely high wages: each month, in addition to the basic pay of 13,000 hryvnias (£293), they would get an additional 100,000 hryvnias (£2,250) – a sevenfold increase.
“They should know the country is definitely grateful to them,” Zelenskyi said at the time.
The Ukrainian military has fought back against Russian forces, recapturing key territories – but the economic impact of the invasion on Ukrainian state and citizen finances has been huge.
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And now the government has started to reduce salaries for non-frontline personnel, provoking concern.
From 1 March this year, a soldier’s basic monthly salary was raised to minimum 20,000 hryvnias (£450), including for those who are wounded or not at the front, but only frontline combatants will receive the 100,000 hryvnias bonus. Some other soldiers will be eligible for smaller bonuses.
The salary cuts come at a difficult time for Ukrainians. High inflation and rising prices for food, essential goods and electricity have produced a serious cost of living crisis in wartime. Thousands of businesses have shut down, moved or been destroyed. And the state is facing a massive budget deficit – more than £20bn in 2022 – due to the extraordinary cost of resisting the Russian invasion.
“We’re in the second year [of the war], many of our businesses are closed, taxes are not paid, we need to buy weapons, the number of the armed forces is huge, we need to equip them, clothe them, feed them, and so on,” said defence minister Oleksiy Reznikov, when asked to justify the salary cuts.
openDemocracy approached the Ukrainian government and the Ministry of Defence for comment, but did not receive a response.
Although soldiers are wary of discussing the Ukrainian army’s internal problems, some are publicly criticising these measures – because it could directly affect Ukraine’s war effort.
Soldiers told openDemocracy that the new basic salary for personnel not serving at the front isn’t enough. This is especially true for those who have been wounded in combat.
Anatoliy*, 33, is a platoon combat medic who has served in the 81st brigade of the 90th battalion since last June. In early January, he was wounded just below the knee by shrapnel, while serving near the village of Bilohorivka, in Luhansk region.
The 581,000 hryvnias (£13,000) that Anatoliy received for his seven months of service on Ukraine's frontline has long been spent, he said, speaking from his home in Kyiv as he recovers from his injuries.
Anatoliy needed to buy protective equipment – new body armour, a helmet, boots and other essential items. For various reasons, the equipment supplied by the army often isn’t adequate.
“Of course, I can fight with what [the state has given], but it’s not efficient. And sometimes it simply reduces your chances of survival,” Anatoliy told openDemocracy.
The total cost of the new kit was 400,000 hryvnias (£9,000), which he paid for with his salary, alongside help from volunteers and crowdfunding on social networks.
Anatoliy is nearly recovered and expects to return to the frontline soon. This time around, he said, he can “only count on volunteers” to help replace the personal equipment he lost in his last battle – as he’s now receiving the basic monthly payment of 24,000 hryvnias and a reduced bonus while the circumstances of his injury are investigated.
Anatoliy’s wife recently quit her job due to concentration problems and the stress of worrying about his safety, and decided to focus on her volunteer work.
The cuts come at a hard time, as Ukraine prepares to launch a spring offensive amid the mounting cost – in human lives, military resources and state funds – of defending Bakhmut
Like other Ukrainians, Anatoliy didn’t join up for the money. But the extra 100,000 hryvnias a month allowed soldiers to be better prepared and equipped, he says.
Some units have a collective fund, explained Ksenia, a member of Solidarity Collectives, an anti-authoritarian volunteer network that raises money for military equipment.
“Those who received more than 100,000 hryvnias tended to drop money into the unit’s collective till. This cash is used to pay for necessary things – for example, car repairs,” she said. “Or they keep it for an emergency. Among the soldiers we support, two units that I know of have this kind of voluntary fund.”
Funds like these also help soldiers navigate the military’s slow-moving bureaucracy, according to Ksenia.
“In some cases, [the military] don’t want to take expensive items on their books, because they require so much paperwork,” she said.
For example, if Solidarity Collectives buys a car for a unit in which one of the soldiers they support is serving, they retain ownership of the car – and will deal with any paperwork arising if the car is lost in battle.
At the same time, openDemocracy has seen documents from three soldiers that suggest there are cases where soldiers have received only 10-20% of their monthly salary.
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The cuts come at a hard time, as Ukraine prepares to launch a spring offensive amid reports of demoralisation among soldiers and the mounting cost – in human lives, military resources and state funds – of defending the eastern city of Bakhmut against Russian forces. One military commander was recently demoted after giving an interview to The Washington Post over the loss of experienced personnel.
Cuts “can lead to negative social consequences”, according to Taras Marshalok, an analyst at the Kyiv School of Economics’ Centre for Public Finance and Public Administration. In particular, he said, “a decrease in the amount of material support can lead to demotivation of military personnel.”
High wages for soldiers helped to stabilise citizens’ personal finances in the first year of Russia’s war, a recent report by the National Bank of Ukraine found. That stabilising effect was felt most directly in local government finances, Marshalok told openDemocracy.
“Military revenues are just a redistribution of funds between the state and local government budgets. By paying salaries to military personnel, the state receives back part of these expenses in the form of personal income tax, and the rest is redistributed to local budgets,” he said.
This means, said Marshalok, that “even a partial reduction in the salaries of military personnel” will have a “negative impact” on local government finances in Ukraine.
Since the Russian invasion, Ukraine has spent £25.8bn on national defence – nine times more than in 2021
Reforms to the country’s labour laws last year also caused some concern: the Ukrainian government exempted employers from a wartime obligation towards employees called up for military service: previously, they had to keep their job open and continue paying their salaries.
But the sheer pressure of balancing Ukraine’s state budget, following a £20.6bn deficit last year, is forcing the government into austerity measures in the public sector.
Since the Russian invasion, Ukraine has spent 1,142.9bn hryvnias (£25.8bn) on national defence – nine times more than in 2021. The number of Ukrainian military personnel, although kept secret, has also increased significantly in response to Russia’s full-scale invasion.
Ukraine plans to cover half of its state expenditure in 2023 from international partners, though not all money received by Ukraine – for example, aid from the International Monetary Fund – is allowed to be spent on defence.
Nevertheless, Ukraine has managed to find additional sources of funding, according to Prime Minister Denys Shmyhal, though it is unclear where from. The government announced this month that a further 537bn hryvnias (£12.1m) has been directed to defence efforts. It has since been reported that Ukraine will also finance these expenditures through more attractive domestic government bonds, bought by banks and citizens.
“All these funds will be spent on financial support for our soldiers and supporting our state defence sector,” said President Zelenskyi.
‘Warriors of reconstruction’
As the Ukrainian government tries to muster much-needed funds for the war effort, the state military healthcare system is overwhelmed by an influx of wounded soldiers from the frontlines.
Mykhaylo*, a special operations soldier who injured his knee cap last summer, told openDemocracy that the pay cut is making his life harder because he has a lot of expenses related to his health.
All injured soldiers have the right to free hospital care, but only frontline combatants are eligible for the bonus payment of 100,000 hryvnias – just for the first months, during inpatient treatment and medical leave. After that, all injured personnel receive only the basic monthly salary of 20,500 hryvnias, until a military medical commission re-evaluates their health and decides whether they should be decommissioned, transferred elsewhere or are fit for combat.
“I’ve spent four months in hospital,” Mykhaylo told openDemocracy. “Since I was injured, I received 43,500 hryvnias [basic salary of 13,500 hryvnias plus 30,000 bonus] per month. That money was just enough for medical treatment, my family and life.” But now, he said, he’s on just 20,000 hryvnias – until a medical commission decides what happens next.
Although soldiers receive free care while in hospital, Mykhaylo (like many others) has to spend additional money on private medical treatment. He needs physiotherapy after a botched operation left him unable to walk without crutches, and is also paying for a private mental health therapist.
Mykhaylo has shared his struggles on Twitter, where he has gained a significant number of followers, who help him raise money for other wounded soldiers in financial difficulties. “Some [of these soldiers] have already been dismissed from the army, and their pension is not enough. Some will need extra treatment and rehabilitation for a long period,” he said.
“After the war, there will be up to five million veterans. What will we do with them?”
As Russia's war drags on, Ukraine is set to become home to millions of veterans. The government is concerned about finding the financial resources to support them and is keen to ensure, where possible, that they rejoin the workforce long-term.
“After the war, there will be up to five million veterans. What will we do with them?” Ruslana Velychko, deputy executive director of the Ukrainian Veterans Fund, recently asked.
Under Ukrainian law, veterans and their families currently enjoy preferential entitlements, for example, to education and land, but Velychko is worried about continuing with these. “The logical solution is to turn these entitlements into monetary benefits, as in Europe,” she said.
One member of Ukraine’s parliamentary committee on social policy and veterans’ rights, Anatoliy Ostapenko, has called for veterans to become Ukraine’s “warriors of restoration” after the war ends. Veterans, he believes, “should develop the post-war economy of Ukraine”.
*Names have been changed to protect identities. All images by Masha Vyshedska.
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