Ukraine's Mykola Azarov,elected on Mar. 11 to be prime minister, said state coffers were "empty" and that a "realistic" budget would have to be redrafted for 2010.
Speaking before parliament voted to appoint him, Azarov, a former finance minister and close ally of President Viktor Yanukovych, also said he hoped for a resumption of funding from the International Monetary Fund based on the "realities" facing Ukraine today.
"The country has been plundered, the coffers are empty, state debt has risen threefold … The main task today is to redraft and get approved a realistic budget," he told parliament.
Political infighting delayed for months the present version of the 2010 budget, drafted by the government of outgoing prime minister Yulia Tymoshenko. It targets a deficit of around 4 percent of GDP.
But populist pledges to beat poverty made by Yanukovych during the election campaign may weigh heavily on the final version of the budget.
Yanukovych has said he will stick to the wage increases passed by parliament last year and which derailed a $16.4 billion bail-out package from the IMF.
Setting out his programme to deputies, Azarov said his government would do everything it could to ensure that moves to pull the country out of crisis would not fall on the poor.
But he added: "If tough measures have to be taken, we will explain the need for them to people and we will push them through."
On relations with the IMF, Azarov said the hoped the suspended programme would resume. "We hope that this programme will be broadened and will be reviewed taking into consideration realities in our country."
His words suggested that the new Ukrainian government might be hoping to press the IMF for softer terms — and even possibly more money — under a resumed or new programme.
The IMF held back a $3.5 billion tranche expected last November after parliament increased minimum wages and pensions by up to 10 percent, a move that would cost the budget billions of dollars it does not have.
The fund has also insisted that household gas prices be increased.
The outgoing government says the IMF is unlikely to resume funding until the second half of this year, leaving the country to find $3-5 billion per quarter to cover budget spending.
