PROBLEMS OF IMPROVEMENT OF THE ECONOMIC SYSTEM OF ENTERPRISES OF THE MUNICIPAL ECONOMY

Keywords: municipal economy, economic system, planning, control, analysis.

Abstract

The article is devoted to the problems of improving the economic system of enterprises of municipal economy. It is determined that the most common problems of the enterprises of this sector are inefficient use of financial, resource, human and environmental potential. Considering that the majority of municipal enterprises are financed from the state and local budgets, the article analyzes the expenditures of the Consolidated Budget of Ukraine for the financing of housing and communal services according to the economic budget classification. It is revealed that the amount of funds allocated by the state for the functioning and development of housing and communal services in 2013 - 2018 has increased, but the economic efficiency of enterprises in this sector is low and often has a negative dynamics. For example, three Kharkiv enterprises were selected, which are the largest providers of municipal services to the population and enterprises - PJSC “Kharkivoblenergo”, PJSC “Kharkivgas” and ME “Kharkivvodokanal”. It has been revealed that, overall, these enterprises have worn-out fixed assets, negative equity and low performance ratio. In the same case, when the enterprise has a significant share of equity and sufficiently worthy fixed assets (PJSC "Kharkivoblenergo"), the economic efficiency is also very low due to the excess of expenses for production of the earned revenue. This situation arises as a result of late payment of debts receivable and increase in consumer debt. Thus, the financial and resource potential of municipal enterprises is used inefficiently.

Another problem is the inefficient use of human potential and inadequate organizational structure. In the former case, municipal enterprises most often use either low-skilled employees or face the problem of staff reluctance to improve their skills. In addition, there are often situations when staff is involved in emergency work followed by downtime. As a result, determining the optimal number and qualification of personnel becomes a problem in the functioning of the economic system of the enterprise. Regarding the organizational structure, it should be noted that, in the authors' opinion, the matrix structure is the most optimal structure for municipal enterprises, which enables more efficient promotion of different groups of goods and services in the domestic and foreign markets. The article also defines the criteria for evaluating the effectiveness of organizational structure functioning in the enterprises of municipal economy. The paper deals with environmental problems faced by municipal enterprises. Ways to solve environmental problems in this field are the use of chemical and biological methods of disposal of industrial waste, supervision of landfills and their maintenance, prevention of the formation of uncontrolled landfills and the formation of a waste collection control system. In the end, the basic principles of functioning of the municipal enterprise in the process of providing public services to the population were defined, which include the principles of simplicity, efficiency, quality, social justice and financial security. It was determined that the criteria of economic efficiency and financial security should be prioritized.

Author Biographies

H. Bazetska, O.M. Beketov National University of Urban Economy in Kharkiv

Ph.D., Associate Professor

H. Zhovtyak, O.M. Beketov National University of Urban Economy in Kharkiv

Ph.D., Associate Professor

D. Serogina, O.M. Beketov National University of Urban Economy in Kharkiv

Ph.D., Associate Professor

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Published
2019-12-28
How to Cite
BazetskaH., ZhovtyakH., & SeroginaD. (2019). PROBLEMS OF IMPROVEMENT OF THE ECONOMIC SYSTEM OF ENTERPRISES OF THE MUNICIPAL ECONOMY. Municipal Economy of Cities, 7(153), 49-59. Retrieved from https://khg.kname.edu.ua/index.php/khg/article/view/5478