Sergei Kuznetsov in Kyiv -

Ukraine’s febrile politics continue as Prime Minister Arseny Yatseniuk resigned following the collapse of the pro-western parliamentary coalition – events regarded as part of a plan by President Petro Poroshenko aimed at forcing early parliamentary elections.

The governing coalition that has been in power since the ousting of former president Viktor Yanukovych in February, collapsed on July 24 after the far-right nationalist Svoboda (Freedom) party and Udar (Punch) party, led by the former champion boxer Vitaly Klitschko, decided to withdraw. Shortly after, other political forces, including the Batkivshchyna (Fatherland) party, led by former prime minister Yulia Tymoshenko, followed suit.

"Today, our pulling out of the coalition is the beginning of a process that will allow the president to call an early parliamentary election… Today, it is clear that there is no coalition in parliament,” Vitaliy Kovalchuk, head of the Udar parliamentary faction, told journalists.

The Prime minister's office on July 25 published an order, signed on July 24, under which Deputy PM Volodymyr Hroysman was appointed acting PM.

According to the constitution, the dissolution of the ruling coalition and inability to form a new one within 30 days will provide grounds for the president to dissolve parliament and call early parliamentary elections. Mykola Tomenko from Batkivshchyna told journalists that snap elections could take place on October 26.

That date is key to those who see the recent moves as part of a long-held plan. According to political blogger Odessatalk, " For months the goal has been to set new RADA [parliamentary] elections at the same time that local elections are to occur. That date is already set. It is 26th October…  That this happened on 24th July should come as no surprise to anybody. That these matters have been engineered by way of dissolved coalitions when working toward 26th October as election day for a new RADA was clear. It is a matter of math only, to realise that it was now or never if that goal was to be achieved."

Yuriy Yakymenko, head of political research at the Kyiv-based Razumkov Center, stresses that the events do not represent a cessation of support for the policy of European integration or a political demarche. "This is the result of agreements that have been made between the political forces and president Petro Poroshenko, with a view to holding early elections and finishing the process of rebooting power in Ukraine," he says.

“Ukraine’s society has demanded early elections because many believe that the current parliament shares responsibility for the actions of the Yanukovych regime,” Yakymenko explained, pointing out that the Party of Regions, led by Yanukovych, headed a ruling coalition in the parliament before this year’s uprising in Kyiv.

Resignation

Poroshenko’s favourable reaction to these events is instructive. “The decision of two factions to pull out of coalition demonstrates that part of the people's deputies do not clutch to their chairs, but feel the mood of voters and are guided by it. All public opinion polls as well as direct communication with people demonstrate that society wants a complete reload of state power,” the president said in a statement.

According to analysts, Poroshenko has many reasons to support the idea of early elections. Recent opinion polls show that the party led by Poroshenko should secure about a quarter of the vote. “Apparently, such a party would participate in the elections,” Yakymenko says.

If the collapse of coalition was part of Poroshenko’s plan, other events were beyond his control. Poroshenko called on members of parliament not to paralyse the work of the institution after the collapse of the ruling coalition, but these appeals were in vain.

On the evening of July 24, parliament refused to support the package of bills proposed by the government that were intended to stabilize state finances by increasing the financial burden on selected industries as well as cutting certain budgetary expenditures. The bills also included measures for the allocation of UAH9bn ($776m) in additional funding for the continuation of military operations against pro-Russian rebels in the east of Ukraine.

"Our government now has no answer to the questions: how we will pay wages, how we will send fuel for armoured vehicles tomorrow morning, how we will pay those families who have lost soldiers?" PM Yatseniuk emotionally appealed to members of parliament.

IMF programme

The changes to the 2014 state budget, needed because of the ongoing military operations in the eastern parts of Ukraine and the steady reductions in budget revenues, was part of the package of the bills rejected by parliament. According to the prime minister, these measures were necessary for successful implementation of the International Monetary Fund's (IMF) stand-by programme.

Ukraine agreed a $17bn two-year support package with the IMF in April – the funding should help the country to overcome the current crisis and build the foundations for a recovery. The country has already received $3.2bn and is waiting for the second tranche of $1.4bn.

However, some analysts believe that the reason the bills were refused by the parliament bears no relation to the conditions of cooperation set by the IMF. Alexander Paraschiy, head of research at Kyiv-based Concorde Capital, tells bne that the rejected was a reaction to an attempt made by the government to increase taxes on oil and gas exploration, as well as to eliminate agricultural subsidies. “There are a lot of members of parliament connected with the oil, gas and agricultural businesses,” he explains.