Ukraine parliament blocks funds for snap election

KIEV (Reuters) - Ukraine's parliament on Wednesday refused to allocate funds to stage an early parliamentary election called by President Viktor Yushchenko to end a longstanding political impasse in the ex-Soviet state.

A bill to make available 417 million hryvnias ($76 million) for the election, the third in as many years, won the support of only 222 lawmakers, four short of a majority.

Ukraine plunged into its latest bout of political turmoil when Yushchenko dissolved parliament after the collapse of coalition linked to the 2004 "Orange Revolution" and called a December election.

Prime Minister Yulia Tymoshenko, his former ally, opposes the election as "criminal" amid the world financial crisis.

The president suspended his decree last week to allow parliament to discuss a legislative package to underpin IMF credits worth $16.5 billion -- approved in first reading on Wednesday. But Tymoshenko's deputies had blockaded proceedings for a week to preclude any discussion of election finance.

"Financing the election is a vital step to overcome the financial crisis by political means," Ksenia Lyapina of the president's Our Ukraine party told the chamber before the vote.

Tymoshenko's bloc, joined by the Communists, said an election would compound the effects of the crisis on Ukraine.

Oleg Lyashko, of the premier's bloc, said election financing would lead to "a lock being slapped on parliament tomorrow and a new election decree. Who will then deal with the crisis?"

Communist Adam Martynyuk said opponents of the election had tried for a week "to save the situation. And you want to throw half a billion hryvnias out the window."

RIVALRY

Yushchenko and the prime minister stood together during the 2004 rallies that swept a pro-Western team to power, but have since been at odds. The president accuses Tymoshenko of excessive ambition, torpedoing the latest "orange" coalition.

Yushchenko's original decree set the election for December 7, but last week said it would be pushed back a week.

Speaking on Wednesday in eastern Ukraine, the president said the date now depended on financing being approved.

"The issue of financing the election is now in parliament's court," he said. "That's where to find an answer on the date."

Analyst Oleskander Dergachyov said it was doubtful the election could be staged in December.

"It is clear that the election cannot be held before the New Year. Yushchenko will have to think about how to save face as his decrees are not being carried out," he said.

"The date is unclear, uncertainty over preparations by election officials and difficulties with electoral law."

(Writing by Ron Popeski; editing by Andrew Roche)