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  • Writer's pictureThe Paladins

Fragments from a War Diary - Part #75

The war in Ukraine is costing a fortune to fight, and Ukraine herself, with all private economy activity having virtually ground to a halt, is not paying for it. The war is in a stagnation stage. After very high early rates of fatality along the front line, as territory was being actively fought over during the first six months or so of the war, the front line has barely moved in the last eleven months of the war and although there are sporadic outbreaks of heavy fighting along the front line, neither side is actively pushing for new territorial conquests (although they profess that they are). Although no official figures seem to be publicly available, the number of soldiers dying on the front line is estimated to be approximately 10 to 20 a day. The number of civilians dying as a result of conflict-related violence in Ukraine is very low, albeit with occasional spikes such as the recent missile attack on the Kharkiv Oblast village of Hroza in which 53 people died. Virtually every violent death is reported in the domestic and international media, whereas the military deaths are not. The death tolls on the Russian side are unknown and to the best of my knowledge unreported in Russian media sources.

Let us assume that some 6,000 people a year are therefore dying on the Ukrainian side of the war as a result of conflict-related violence. The Ukrainian government provides approximately US$50,000 to the family of each deceased. That is approximately US$300 million per year in death-related payments. Then there are the soldiers’ salaries, which are surprisingly generous although the work is admittedly extremely dangerous. Each soldier fighting on the front line is paid a salary of between 50,000 and 120,000 Gryvnas a month: that is to say, between 1,250 Euros and 3,125 Euros, assuming an exchange rate of 40 Gryvnas to the Euro. The median average might be 80,000 Gryvnas (2,000 Euros) per month. These are very large salaries by Ukrainian standards, in which the salary of the President of Ukraine is 28,000 Gryvnas (700 Euros) a month and the mean monthly salary in Ukraine is 23,000 Gryvnas (575 Euros) and the monthly minimum wage is 6,700 Gryvnas (168 Euros).

These figures are rather unusual. In the US military, a Private (First Class) might earn US$2,500 a month and the President of the United States receives a salary of slightly more than US$33,300 per month. The mean salary in the United States is about US$4,700 per month, and the monthly minimum wage may be calculated as approximately US$1,160 per month. Similar analyses may be undertaken across other countries, but the point being made is that Ukrainian soldiers are paid vastly more proportionate to other people, including public and private sector employees, in Ukraine compared to in other countries. Whereas in most countries military service is not hugely well-paid compared to other areas of activity, in Ukraine the military are some of the best paid people in the country. Yes they take grave risks with their lives. But all people serving in the Armed Forces and in active service take risks with their lives. These striking disparities call for explanation, and the explanations may be twofold. Firstly, foreign governments - and in particular the United States - are paying the bill. Secondly, the budget of the Ukrainian Armed Forces is infested with corruption.

Although I was not able to find precise figures, the number of Ukrainian soldiers in active service is estimated to be in the region of 700,000. That amounts to a total salary bill of almost 17 billion Euros a year. I have seen figures suggesting that the total annual budget of the Ukrainian Armed Forces is in excess of US$130 billion. It is hard to assess just how much of this is money paid by the US taxpayer. The US Congress approves tranches of military and other aid from time to time, but I have seen the figure of US$60 billion provided by some. The United States is paying a very significant proportion of total Ukrainian military spending, on any analysis.

Because adequate records are not kept, it is hard to assess the veracity of any of the figures relating to actual Ukrainian military expenditure. Not all the families of the deceased receive the full stipulated compensation package, by all accounts. It is not clear to me whether the soldiers on the front line all receive the full amount of the stated salaries that have been quoted to me, or whether parts of their salaries must be relinquished to other military commanders or government officials or contributed to various kinds of more or less legitimate funds. I do not know nearly enough about how the Ukrainian Armed Forces undertakes its procurement, and how much of the Ukrainian military budget is actually spent on the things that we are told it is spent on and how much is being diverted to other purposes or even to private pockets.

What I do know is that there is something very peculiar with a system in which a Private in the Ukrainian military is receiving a salary, at least on paper, that is more than double the salary of the President of Ukraine. The cost of living in Ukraine is one of the lowest in Europe; a salary of 2,000 Euros a month will let you live like a King in Ukraine. Maybe all these front line soldiers are becoming extremely wealthy extremely quickly, because while serving on the front line your expenditures are minimal. Or maybe this money is all going somewhere else.

Because the West is substantially funding this war, we have the right to ask for greater accountability. There is inevitably a question being raised at the moment as to whether the current levels of funding on the part of western government to Ukraine’s military and civilian government structures is sustainable over the course of the next several years during which the war is expected to continue: Russia has publicly stated that she is in this war for the long haul, and her economy appears to have the resilience to sustain it, even with sanctions in place. It might ease the process of western democratic consensus for continued financial support for Ukraine if there were substantially greater transparency as to how the donated funds are being spent. That transparency is likely to arise only if western governments place financial services experts inside Ukrainian government ministries to supervise the expenditure of foreign taxpayer funds.

Finally, I have established why injured soldiers are released from military hospitals too quickly, without their wounds being fully healed, to return to the front. The answer is that they discharge themselves prematurely. I am told that when you are resident in a Ukrainian military hospital, you are paid a mere 700 Gryvnas (18 Euros) per month. Therefore your incentive is to get your injuries patched up as quickly as possible and get back to the front line even though you may not be physically or mentally recovered. That may well be why, when I first arrived in Ukraine, I was sharing a sleeper compartment on the train from Lviv to Zaporizhzhia with a group of soldiers who were returning to the front line from military hospital and showing me their incompletely healed injuries. They were going back to the front line for the money.

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