Anti-corruption reform in the Ministry of Infrastructure of Ukraine - reality or utopia: Lavreniuk's case

Lavreniuk Yurii Fedorovich, was born on April 25, 1980. He has four higher educations, including financial and legal, PHD in Public Administration. He is also a professor of the Constitutional, Administrative and International Law Department of the National University "Odessa Law Academy". Lavreniuk is a Deputy Minister of Infrastructure of Ukraine from April 2016 to November 2019.

The Ministry of Infrastructure is one of the largest and richest in Ukraine: the budget of the department this year reached UAH 176 billion. Where capital is abundant, there is always a place for big temptation, monopolization, and shadowing of the industry Combating corruption in the MIU is needed more than ever before. Will the authorities be able to overcome corruption in the transport sector? Yes, if we rely on the experience of successful cases that already happened in the Ministry several years ago. By the way, then the progress of Ukraine was positively assessed in the USA and Europe.

We are talking about the experience of cooperation between the Ministry of Infrastructure of Ukraine and the project of international technical assistance "Support for leading organizations in combating corruption in Ukraine" VzayemoDiya." As part of this agreement, the project provided technical assistance to the MIU in the development and implementation of anti-corruption policies and reforms.

“We conducted an expert analysis and assessment of all ministries and departments, this became the basis for the selection of key partner institutions. We were looking for government bodies that are truly committed and ready to implement change. We are pleased to support the Ministry of Infrastructure in the field of preventing and combating corruption and hope that this will be the beginning of long-term cooperation,”– noted the representative of the United States Agency for International Development (USAID) Mr. Garth Willis and noted that the Ministry of Infrastructure is one of the leading agencies in the implementation of best practices to prevent corruption.

Yuri Lavreniuk - Ideologist of the anti-corruption reform of the MIU

From the Ukrainian side, a letter on cooperation with the Americans was signed on March 14, 2018 by the Deputy Minister Yuriy Lavreniuk, who at that time already had considerable experience of serving in the Ministry of Internal Affairs as head of the corruption prevention department, chairmanship of a non-governmental organization for combating corruption and organized crime, and also carrying out lustration in the internal affairs bodies of Ukraine.

Besides, Mr. Lavreniuk completed anti-corruption courses organized by the NATO office and, as part of the Ukrainian government delegation, underwent professional training in the United States under the Open World program, which was introduced by the international public organization World Learning. Therefore, it was the knowledge gained and the experience of American colleagues that formed the basis for the anti-corruption policy and reforms of the MIU.

In particular, in July 2016, the deputy head of the department announced the conduct of tough inspections in the subordinate enterprises and organizations of the Ministry. This process provided for an anti-corruption audit by all the subsidiaries of the MIU, with special attention paid to conflicts of interest in the structural divisions of the department, and it was proposed to involve law enforcement officers in monitoring the effectiveness of official investigations against officials of the Ministry of Infrastructure.

The next step on the path of the anti-corruption reform of the MIU was the creation of two new divisions for the prevention of corruption within the structure of the Ministry - the department for conducting inspections and the sector for financial monitoring. According to the Deputy Minister, in order to avoid bias and conflict of interests, people from these departments were not recruited from the staff of the department. In addition, new employees underwent additional training courses.

Reforming seaports, developing concession projects, creating a Road Fund and a proposal for the introduction of international toll autobahns in Ukraine are all initiatives of the team led by Lavreniuk, which focused on the most successful cases from the USA and Europe.

8 million In a Month: The First Results of the Reform

The first fruitful results were not long in coming: on behalf of Yuriy Lavreniuk, the Department of Economic and Internal Security was reorganized in August-September 2016, which was entrusted with the functions of an authorized anti-corruption unit at such a large state enterprise as Ukrposhta.

In the first month and a half alone, the Department stopped the theft for UAH 8 million Photo: Ukrposhta

In a fairly short period of time, the activities of the reorganized authorized division have borne fruit. In August, employees of the Department of Economic and Internal Security of the State Enterprise "Ukrposhta" discovered a number of illegal actions by officials of the state-owned enterprise, namely, embezzlement of public funds in the amount of more than UAH 8 million. In the first month and a half of the division's activity, it was possible to return about UAH 1.2 million to Ukrposhta's income.

Transparency and delineation of functions: top steps to counter corruption

Subsequently, the anti-corruption department of the MIU was reformed by reorganizing it into the Office of Corruption Prevention, Internal Investigations and State Financial Monitoring, and the top 10 steps to overcome corruption were submitted to the Cabinet of Ministers of Ukraine. Six of the measures proposed by the Ministry of Infrastructure of Ukraine were approved and became a roadmap for further actions in the direction of preventing and combating corruption in the MIU and subordinate enterprises, institutions and organizations.

Here we can talk about ensuring openness in air communications, transparency and accountability of the supervisory boards of state-owned enterprises in those areas where the problems of preventing and combating corruption have been accumulating for many years.

In 2017, the Ministry created significant progress in the areas of simplification and translation into electronic format of licensing and permitting procedures in the field of road and air transport, as well as the actual delineation of combining the powers of Ukravtodor as a customer, contractor and controller, transfer of control functions to independent engineering companies and the preservation of the customer's function for the state represented by Ukravtodor only on the roads of national importance.

Top 10 steps to overcome corruption were submitted to the Government for consideration, the Cabinet of Ministers approved six of them Photo: Ministry of Infrastructure

“I see my main task in the segment of the Ministry of Infrastructure in the full transition into electronic format of the services provided by the MIU and institutions subordinate to the Ministry. There should be no contact of an official with a person, everything should be remotely: a citizen provides documents online, the package is checked for completeness, after an affirmative answer, the citizen sends the originals by mail, officials process, and this citizen online (via phone or otherwise ) a message about the corresponding decision should come. Then a date and time is set when you can pick up documents without standing in line. This is a “one-stop shop” system that we are introducing for all services ”, - Lavreniuk commented on the innovations in one of his interviews in 2017.

Anti-corruption expertise and public dialogue

In addition, the Ministry of Infrastructure introduced the practice of conducting anti-corruption expertise of regulatory legal acts, which was adopted by the specialized committee of the Verkhovna Rada on preventing and combating corruption.

The Deputy Minister managed to achieve an unprecedented intensity of dialogue with the public and the expert environment - under the chairmanship of Yuriy Lavreniuk, regular joint meetings were held with the participation of specialized departments heads of the MIU and top management of reporting enterprises, institutions and organizations, with the public block, experts and other interested parties.

Mr. Yurii, taking into account the successful experience of his American colleagues, also actively advocated a reasonable denationalization of enterprises in the industry: “ All state stevedores a priori should be transferred either on a concession or on lease. We said earlier that privatization is a utopia. We are not going to give away any normally functioning port for privatization. Such seaports as Mariupol and Berdyansk, which are now in decline due to the military aggression of the Russian Federation, must be given in concession. We are convinced that only a private trader will be able to develop these ports, ensure their development and attract additional cargo traffic .”

Criminal cases and sentences to corrupt officials - the consequences of an anti-corruption audit

Lavreniuk's work in the Ministry of Infrastructure resulted in several criminal proceedings as a result of the inspections carried out. The first sign was an investigation in the Ukrinteravtoservice branch in the Transcarpathian region: the head of the Customs Brokerage Services Department was convicted of registering brokerage companies for relatives and receiving clients not at his state-owned enterprises, but redirecting them to “friends”, earning money for mediation of considerable funds. The case was brought to court, and the perpetrator received a sentence of imprisonment.

In the luggage of the anti-corruption department of the MIU - the high-profile case of Amelin from the USPA, the investigation of fraud for UAH 20 million in the Mykolayiv seaport, suspicion of the head of the Berdiansk port, the Ukrtanker case and others.

In addition, the department, together with a commission created with NABU, managed to find and partially return to Ukraine state property that was considered hopelessly lost - we are talking, in particular, about the foreign assets of the Black Sea Shipping Company in Vietnam.

In 2019, using the effective experience of the United States of America, Lavreniuk began his work at the MIU on a pilot project for the "General Inspectorate", which involved developing an effective mechanism for preventing and detecting corruption, conducting internal audit and information security.

Private port staff and people's deputies: who opposed the reform of the industry?

However, such a restructuring has met with fierce resistance in the corrupt MIU system. The checks of the USPA and seaports were accompanied by the organization of mass protests, and individual parliamentarians openly demanded Lavrenyik's resignation.

“ For example, I am going to inspect one enterprise in May this year. However, a group of 10 people's deputies came to convince me that there is no need to come with a check. Dear People's Deputies announced an "ultimatum" to me: if the check takes place, they will leave the faction. I told them: “Gentlemen, go wherever you want. I am an official who does his job. " That was the end of the conversation, ” Lavreniuk noted.

Moreover, large players in the sea transportation market, were dissatisfied with the reform of the industry, signed an open letter, where they accused Yuriy Lavreniuk of corruption and demanded his dismissal. And on October 4, 2019, the deputy of the Servant of the People faction, Andrii Motovilovets, who is associated with private port workers (in particular, with Odessa businessman Stavnitser, who owns the private port of TIS), addressed Prime Minister Alexii Goncharuk from the parliamentary rostrum with a demand to get rid of Lavreniuk who allegedly “built corruption schemes”.

What now?

Mr. Lavreniuk resigned from the ministry of his own free will, and after that the anti-corruption reform in the department stalled. In February 2020, Vladislav Kryklii (ex-Minister of Infrastructure of Ukraine - was appointed to the post on August 29, 2019 and dismissed on May 18, 2021), contrary to the course proclaimed by the President to fight corruption at all levels, approved a document that actually destroyed the MIU unit responsible for detecting and preventing corruption.

So, during the tenure of Lavreniuk, the Office for the Prevention of Corruption, Internal Investigations and State Financial Monitoring had 17 qualified employees who were trained in the School of Anti-Corruption Commissioners in October 2019, and whose training was highly appreciated by international experts, then with the Kriklii team, most specialists simply reduced, leaving the sector where 2 people work.

Note that the Ministry of Infrastructure is the largest department in Ukraine, which covers many areas (air traffic, maritime industry, railways, highways, communications, and so on), and the subject of financial monitoring. And two people are simply physically unable to carry out high-quality checks in all these areas. Mr. Lavreniuk, who was focused on high world standards, undoubtedly understood the importance of preserving and increasing a qualified anti-corruption apparatus. Does the Kriklii team has it? Or, on the contrary, the current authorities are not eager to identify and prevent corruption schemes?

The situation with other developments of Yurii Lavreniuk's team is no less sad. Leaving his post, Mr. Lavreniuk left to his followers the so-called white book - a roadmap for transformations in the infrastructure sphere of Ukraine. However, all the reforms initiated earlier have either been failed by the current leadership of the Ministry, or they are presented as their "know-how" (as happened with the creation of the Road Fund and the reform of seaports) and are turning into a means of self-promotion.

It should be noted that on May 18, 2021, the Ukrainian parliament voted for the resignation of Vladislav Krikliy. Commenting on this decision, President Volodymyr Zelenskyy stressed that the ex-Minister and his team did not cope with the tasks set - this applies to the construction of roads, and the Administration of seaports, and the creation of a public-private air carrier.

Unfortunately, there is no systematic and analytical approach in the actions of the new authorities, and instead of the progress noted by American experts a few years ago, there is a persistent trend towards regression in the industry. Institutional memory at all levels has been destroyed, as it was under Yanukovych. Everything is according to the Soviet methodology for the subversive work of Kremlin agents in the CIA for 1944: “... to abolish the institution of knowledge transfer, to change personnel as soon as possible, to eliminate as much time as possible for getting into the course of work”.

Is it possible to return the development of the infrastructure industry in Ukraine to a constructive track, before it's too late? Yes, if real professionals in their field, interested in eradicating ineffective and corrupt schemes, get down to business. And the case of Lavrenyik's team is a real confirmation of this.

On May 20, 2021, Oleksandr Kubrakov was appointed to the post of Minister of Infrastructure of Ukraine - 284 deputies voted for this decision. Mr. Kubrakov, who has headed the State Agency for Highways since November 2019, has already managed to show serious success in specialized infrastructure projects in his previous position. Therefore, his appointment inspires some optimism and gives reason to hope that the new Minister will be able to cope with the challenges facing the country's infrastructure sector and successfully implement the course of reforms outlined in 2016-2019.

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