KIEV, Dec. 11 ??“ President Viktor Yushchenko on Monday vetoed the government??™s 2007 budget hours after it was submitted by Parliament, a move that may trigger a serious political crisis in Ukraine.

This is the first time ever that the president has used the power to reject the budget in Ukraine. It puts pressure on the pro-government coalition to comply with the president??™s demands within the next 20 days or face major financial challenges.

The development underscores a growing confrontation between the pro-Western president and pro-Russian government over foreign policy and over the pace of economic reforms.

Arseniy Yatseniuk, Yushchenko??™s deputy chief of staff, will address lawmakers on changes that must be made for the president to sign the budget, the presidential press service reported on its Website.

Should the coalition fail to approve the budget before the end of the year, all spending in January will be restricted to a 1/12 of the entire spending in 2006, according to law.

This means the spending in January will have a shortage of at least 2 billion hryvnias compared with what the government had planned to spend, causing a financial crunch and perhaps suspending some social programs.

Hours before the president had vetoed the budget, the government issued a tough-worded statement warning the veto would ???provoke a political crisis and a conflict in the society.???

???The government considers that the president will not find himself under the influence of those adventurous politicians that call for disrupting the budget process and causing chaos in our country,??? the statement said.

Although Yushchenko has been persistently criticizing the government for not doing enough to increase social spending in the 2007 budget, the veto underscores a growing political standoff between the two.

Prime Minister Viktor Yanukovych has been persistently attacking and challenging Yushchenko??™s powers ever since becoming the prime minister in early August.

The standoff between Yushchenko and Yanukovych culminated two weeks ago when the pro-government coalition had voted to dismiss Foreign Minister Boris Tarasiuk, Yushchenko??™s ally, in a bid to reverse the country??™s pro-Western foreign policy.

Tarasiuk appealed the dismissal in court, while Yushchenko had issued a decree re-assuring his authority as the minister.

The coalition insisted on Monday that Tarasiuk must go, but Yushchenko had again stressed that Tarasiuk will stay.

The standoff between the president and the government may lead to early general election next year, which explains why the government and the opposition have been recently increasingly appealing to the people, analysts said. (tl/ez)