Social Transfers and Public Finance Efficiency: Navigating Digital Transformation Challenges

Abstract

Introduction: The paper analyses the experience and challenges of digital transformations in terms of the impact of social transfers on the efficiency of public finances. The significance of the study is that social transfers as payments to persons not engaged in economic activity are currently receiving particular attention in the context of the Russian-Ukrainian war. Social transfers constitute a significant part of public finances and, therefore, require public scrutiny.

Objectives: The study aims to analyse the experience and challenges of digital transformation in terms of the impact of social transfers on the efficiency of public finances.

Methods: The study used the following research methods: description, comparison, analysis and synthesis, and literature analysis.

Results: The study revealed that, at the present stage, there are problems with introducing digitalisation in public finance. This is due to both insufficient material support and the lack of an established system of public access to e-government. This suggests that it is essential to accelerate the introduction of information technology in the area of social transfers.

Conclusions: The research identifies trends in social transfers in Ukraine. In particular, an increasing amount of transfers is allocated to help war veterans and their families, as well as persons in difficult life circumstances due to martial law. It is emphasised that social expenditures are realised mainly from external sources and are spent on the needs of citizens of retirement age. It is established that social transfers to combatants are currently insufficient.