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| Prime Minister Arseniy Yatesnyuk chairs a meeting of the Cabinet of Ministers of Ukraine. The official salary of ministers is $260 a month. |
It was no ordinary email blast.
Buryachok, who worked with foreign donors, addressed more than 50 people, including representatives of the World Bank, European Commission, U.S. State Department, International Finance Corporation, European Investment Bank and others.
His attention-getting subject line: “WARNING – ILLEGAL PRACTICES AT TOP LEVEL AT MINISTRY OF INFRASTRUCTURE OF UKRAINE.”
Buryachok alleged that President Petro Poroshenko is illegally paying Pyvovarsky $50,000 a month and his top deputy minister, Vladimir Shulmeister, is receiving $30,000 a month – more than the cumulative monthly salaries of 250 ministry employees. He said the payment scheme is run by Poroshenko’s chief of staff Boris Lozhkin through associate Mikhail Beylin. He said he learned of it from reliable people in the ministry.
Poroshenko’s press service called the allegations false, as did Pyvovarsky. Beylin could not be reached.
Buryachok, in an interview, said that he is confident of his accusations and that the payments mean Pyvovarsky cannot act independently – one reason, he said, reforms are moving so slowly and questionably in Ukraine.
“The guy is a liar,” Pyvovarsky told the Kyiv Post. “I don’t get paid – only the official salary of 6,000 hryvnias ($260) monthly.”
He can live without a real salary, he said, because he saved money while working in the private sector before becoming minister in December. Pyvovarsky was the CEO of Continuum Group, which runs a chain of gas stations and has dairy processing assets. Previously, he worked for Kyiv-based Dragon Capital and at the International Finance Corporation office in Moscow.
Pyvovarsky, who oversees Ukraine’s vital aviation, railway, port and postal industries, said that he fired Buryachok for poor performance.
Buryachok, who previously worked for KPMG as an auditor, consultant at Deloitte, for the defunct Delta Bank and at Icon Private Equity, said he quit because his volunteer work was not valued.
The minister said that Buryachok is merely recycling a recurring “black public relations campaign” against him because of his willingness to challenge vested interests in the industries he regulates, root out corruption and serve the public interest.
“Hundreds of thousands of dollars were spent to knock me down,” Pyvovarsky said. He is not sure who is behind the smear campaign, but said it flares up when he tries to make key changes in the top state-owned companies that he oversees. He said he was also attacked last summer when he changed the CEO of Ukrzalyznitsia, the state railways behemoth that employs nearly 300,000 people and had historically been a money pit for fraud and waste.
In a reply to the group that Buryachok emailed, Pyvovarsky said that the chronically unprofitable railways “has been consistently profitable” since the new CEO took over in summer.
“My ministry is a champion in terms of transparency, introduction of open data policy and digital procurement,” Pyvovarsky wrote. “I would like to assure you that this will be the case during my entire stay with the ministry.
He told the Kyiv Post that he suspects the current attacks coincide with two upcoming appointments – the head of Ukraine’s postal service and the head of Kyiv’s Boryspil International Airport.
Pyvovarsky said he hired during a competitive, open and transparent hiring process involving a committee of 10 people, including five fellow ministers and five members of international finance institutions. “I initiated that process in January,” he said.
Wherever the truth lies, the dispute highlights Ukraine’s ongoing inability to adequately and transparently pay state employees. Most of the state’s vast workforce of more than 1 million people are officially paid pauper wages of $300 or less a month, an invitation to invent the corrupt, bribe-taking schemes that Ukraine’s public officials have become notorious for engaging in.
The other explanation is that sponsors – whether in private or public sectors – are secretly paying top government officials for their work, raising obvious questions about conflicts of interest and whose interests are being served by government employees.
Pyvovarsky has been at the forefront of urging Ukraine’s government to increase the state budget to pay livable wages to public employees. He said he has lost quality employees in the last year because he is unable to pay them properly through the state budget.
Ukraine’s economy, however, has shrunk to below $80 billion and next year’s government spending priorities, for a budget that will be less than $40 billion, are the military and social support payments for the poor and elderly.
Even though one of them is not telling the truth about salaries and the reasons for Buryachok’s departure, both Pyvovarsky and Buryachok agreed that the minister is having a hard time making some of the changes he wants.
“The reform pace is very, very slow, extremely slow,” Buryachok told the Kyiv Post. “There is a lot of PR and a lot of talk about how we’re reforming, but very little has changed.”
Part of the resistance is coming from lawmakers. “There is a huge lobby in parliament not to change the situation,” he said. Key state-owned enterprises in the ministry are not controlled by Pyvovarsky, he alleged, including the railways, ports and postal service.
“The top management was appointed by some presidential quota,” Buryachok alleged. “Within the ministry, we have no understanding what’s going on with the Ukrainian (postal service). We have no instrument of influence.”
Buryachok also cited problems with Ukravtodor, the state agency in charge of road repairs and another notoriously corrupt enterprise. Pyvovarsky, he said, has been unable to fire the head of the subsidiary Ukrdorinvest for six months.
The minister confirmed that part of Buryachok’s claim, saying that only the head of Ukravtodor had the right to fire the employee in question. Pyvovarsky expects the new head of Ukravtodor “to take care of the situation.”
Buryachok said he’s received messages of support since he sent the email and wants to have nothing to do with the minister. “If you get money you are not independent, this is first of all,” Buryachok said. “You cannot voice the problems. You cannot tell the truth if you get money from the Presidential Administration. Your independence is corrupted. You are forced to do what you are told to do.”
Pyvovarsky sees an entirely different motivation behind the attacks.
“It looks like Maxim wants to go into politics or build a career,” Pyvovarsky said. “The guys asked me to take him on board at the beginning of the year and now I’m getting this. It’s a lesson for me.”
Brian Bonner
Poroshenko’s press service called the allegations false, as did Pyvovarsky. Beylin could not be reached.
Buryachok, in an interview, said that he is confident of his accusations and that the payments mean Pyvovarsky cannot act independently – one reason, he said, reforms are moving so slowly and questionably in Ukraine.
“The guy is a liar,” Pyvovarsky told the Kyiv Post. “I don’t get paid – only the official salary of 6,000 hryvnias ($260) monthly.”
He can live without a real salary, he said, because he saved money while working in the private sector before becoming minister in December. Pyvovarsky was the CEO of Continuum Group, which runs a chain of gas stations and has dairy processing assets. Previously, he worked for Kyiv-based Dragon Capital and at the International Finance Corporation office in Moscow.
Pyvovarsky, who oversees Ukraine’s vital aviation, railway, port and postal industries, said that he fired Buryachok for poor performance.
Buryachok, who previously worked for KPMG as an auditor, consultant at Deloitte, for the defunct Delta Bank and at Icon Private Equity, said he quit because his volunteer work was not valued.
 |
| Former adviser to Ukrainian Infrastructure Minister Andriy Pyvovarsky, Maxim Buryachok, (L) claims that President Petro Poroshenko is illegally paying Pyvovarsky (R) $50,000 a month. |
The minister said that Buryachok is merely recycling a recurring “black public relations campaign” against him because of his willingness to challenge vested interests in the industries he regulates, root out corruption and serve the public interest.
“Hundreds of thousands of dollars were spent to knock me down,” Pyvovarsky said. He is not sure who is behind the smear campaign, but said it flares up when he tries to make key changes in the top state-owned companies that he oversees. He said he was also attacked last summer when he changed the CEO of Ukrzalyznitsia, the state railways behemoth that employs nearly 300,000 people and had historically been a money pit for fraud and waste.
In a reply to the group that Buryachok emailed, Pyvovarsky said that the chronically unprofitable railways “has been consistently profitable” since the new CEO took over in summer.
“My ministry is a champion in terms of transparency, introduction of open data policy and digital procurement,” Pyvovarsky wrote. “I would like to assure you that this will be the case during my entire stay with the ministry.
He told the Kyiv Post that he suspects the current attacks coincide with two upcoming appointments – the head of Ukraine’s postal service and the head of Kyiv’s Boryspil International Airport.
Pyvovarsky said he hired during a competitive, open and transparent hiring process involving a committee of 10 people, including five fellow ministers and five members of international finance institutions. “I initiated that process in January,” he said.
Wherever the truth lies, the dispute highlights Ukraine’s ongoing inability to adequately and transparently pay state employees. Most of the state’s vast workforce of more than 1 million people are officially paid pauper wages of $300 or less a month, an invitation to invent the corrupt, bribe-taking schemes that Ukraine’s public officials have become notorious for engaging in.
The other explanation is that sponsors – whether in private or public sectors – are secretly paying top government officials for their work, raising obvious questions about conflicts of interest and whose interests are being served by government employees.
Pyvovarsky has been at the forefront of urging Ukraine’s government to increase the state budget to pay livable wages to public employees. He said he has lost quality employees in the last year because he is unable to pay them properly through the state budget.
Ukraine’s economy, however, has shrunk to below $80 billion and next year’s government spending priorities, for a budget that will be less than $40 billion, are the military and social support payments for the poor and elderly.
Even though one of them is not telling the truth about salaries and the reasons for Buryachok’s departure, both Pyvovarsky and Buryachok agreed that the minister is having a hard time making some of the changes he wants.
“The reform pace is very, very slow, extremely slow,” Buryachok told the Kyiv Post. “There is a lot of PR and a lot of talk about how we’re reforming, but very little has changed.”
Part of the resistance is coming from lawmakers. “There is a huge lobby in parliament not to change the situation,” he said. Key state-owned enterprises in the ministry are not controlled by Pyvovarsky, he alleged, including the railways, ports and postal service.
“The top management was appointed by some presidential quota,” Buryachok alleged. “Within the ministry, we have no understanding what’s going on with the Ukrainian (postal service). We have no instrument of influence.”
Buryachok also cited problems with Ukravtodor, the state agency in charge of road repairs and another notoriously corrupt enterprise. Pyvovarsky, he said, has been unable to fire the head of the subsidiary Ukrdorinvest for six months.
The minister confirmed that part of Buryachok’s claim, saying that only the head of Ukravtodor had the right to fire the employee in question. Pyvovarsky expects the new head of Ukravtodor “to take care of the situation.”
Buryachok said he’s received messages of support since he sent the email and wants to have nothing to do with the minister. “If you get money you are not independent, this is first of all,” Buryachok said. “You cannot voice the problems. You cannot tell the truth if you get money from the Presidential Administration. Your independence is corrupted. You are forced to do what you are told to do.”
Pyvovarsky sees an entirely different motivation behind the attacks.
“It looks like Maxim wants to go into politics or build a career,” Pyvovarsky said. “The guys asked me to take him on board at the beginning of the year and now I’m getting this. It’s a lesson for me.”
Brian Bonner
Kyiv Post chief editor Brian Bonner can be reached at bonner@kyivpost.com.
http://www.kyivpost.com/content/ukraine/ministers-monthly-pay-50000-or-just-260-401962.html
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