The Opposition government continues a regular monitoring of social and economic development of the country. Experts say that an increase in tariffs, which occurs at the present Government’s direct instigation, could trigger a further spurge of inflation. Over the first three months of the Tymoshenko Government work inflation grew by 9.7% and exceeded the annual prognosis (9.6%). It is an obvious outcome of failed economic, fiscal and social policy of the Government.

Exactly social populism of the Government caused unprecedented inflationary expectations of the population not backed by relevant supply on the domestic market of consumer goods, which production growth has almost stopped.

Experts estimate that only within three months of the current year citizens already lost UAH 10 billion due to escalation of inflation. It exceeds an amount of compensated depreciated savings of the Savings bank several times. But prices not only for food and other essential goods are growing.

Tariffs on railway transportation, on electric energy and natural gas are going up. In the 1st quarter of 2008 railway fare increased by 13.4%, in April - by 17% more and since July 1 they will rise by 3% per month. By the end of year railway fares will grow by 35%. In its turn, it will lead to considerable losses of the enterprises, industries which use transport services, of citizens-passengers.

The largest losses will be incurred by the producers of goods with substantial share of transport costs, in particular metallurgical complex and machine building. By experts’ estimations, a metallurgical enterprise will suffer losses at the amount of about UAH 240 million owing to the increase in tariffs. The situation with railway transportation of passengers is not better. In January-March of 2008 tariffs grew by 7%. Although the Government stated repeatedly that there would be no increase in tariffs. The Ministry of Transport and Communications heads’ recent statements testify that tariffs will go up further as well, allegedly, due to high inflation caused by the present Government. The similar situation is with tariffs on electric power and gas. The National Commission on Regulating Electric Power (NCRE) increased a charge for electric power generated by NAEK Energoatom in March from 9.02 kopecks to 10.5 kopecks per 1 kilowatt-hour and since April 1 – to 11 kopecks per 1 kilowatt-hour.

The government also recommended NCRE to carry out since May a gas price increase for the population by 3-5% a month and for heat power enterprises since June by 5-7% a month. Such rise in prices for energy carriers will entail an increase in charges for housing and communal services, growth of citizens’ expenses and of the budget for payment for these services.

The budget’s additional need for covering a gap between the real cost of services and fees for them amounts UAH 30-40 billion. However, the budget envisages only about UAH 5 billion.