Ukraine Extends Reconstruction Payments to Compensate for Wartime Property Damage

The Ukrainian government is expanding its wartime compensation program, where Ukrainians can now apply for up to Hr.500,000 ($13,556) for major house restoration if their property was damaged or destroyed by Russian attacks after the full-scale invasion began in February 2022.

This is the second stage of the program, according to a news release by the Ministry of Digital Transformation, which would come with higher rates of compensation for properties with the most severe damage.

Following the new update, applicants can receive compensation of up to Hr.500,000 ($13,556) for private houses or Hr.350,000 ($9,489) for apartments.

The funds will be released in two installments, an initial payment of 70 percent of the funds for basic repair work and the remaining 30 percent upon successful inspection and approval by the local council.

The updates only apply to repairable buildings, as those with irreparable damages would receive a special document to help purchase a new property, with the rate being determined by a special commission.

The compensation program, known as e-recovery, was developed by the Ministry of Digital Transformation and launched in May this year. Under the program, property owners could receive funds from the government to help rebuild their destroyed properties or purchase a new home.

The ministry reported earlier that co-owners are also eligible for compensation.

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Once the applications were approved, the funds would be transferred to a dedicated bank card, which Ukrainians could then use to purchase services and materials from a pre-approved list of suppliers – a move intended to prevent misappropriation of funds, according to Deputy Minister of Digital Transformation Mykhailo Fedorov.

However, as it could take months before applications are approved, some Ukrainians have opted not to wait – in the face of the onset of winter – and paid out of their own pocket, in which case they would not be eligible for compensation under the program.

The government is planning to introduce changes to address the above situation, starting on Jan. 1, 2024.

According to the Ministry of Digital Transformation, around 26,500 families have received compensation through the program, with the average compensation being Hr.77,000 ($2,085).

Mariia, whose grandmother experienced broken windows in her apartment – one of the most common occurrences of property damage reported in wartime Ukraine. She carried out the repairs herself during autumn last year, prior to the program’s introduction, which cost Hr.40,000 ($1,083) to replace her windows.

To date, the government has approved and transferred approximately Hr.655 million ($173 million) for property reconstruction under the program, with more than 2,700 applications in total. It will likely need to be a major element of Ukraine’s post-war reconstruction.