KIEV, Nov. 16 – President Viktor Yushchenko on Monday vetoed a bill that had called for one billion hryvnias to be printed by the National Bank of Ukraine to fight the spreading flu epidemic.

Yushchenko suggested the government and lawmakers should cut other budget spending and also to borrow domestically to make funds available for the program.

“Yushchenko returned the bill to Parliament with his 2009 budget amendments,” the presidential press service reported.

The move is a setback for Tymoshenko, whose government has been facing financial crunch and has been considering all ways of funding, including the money printing, to get going.

The veto is especially painful as the International Monetary Fund had recently refused to disburse $3.4 billion installment to Ukraine amid concerns that the government had failed to reform the economy in line with commitments.

Yushchenko argued by simply printing one billion hryvnias, this would things worse by adding another problem to the country: high inflation.

“This may distort the monetary and credit policies of the NBU,” Yushchenko said as he had provided reasoning for vetoing the legislation. “Besides, this will lead to extra emission that will cause acceleration of inflation pace, undermine the hryvnia’s value and drop the people’s living standards.”

The move comes days after Tymoshenko has urged Yushchenko to sign the legislation, warning that otherwise the government will not have enough money to fight the flu epidemic.

The government already spent 500 million hryvnias to fight the flu over the past four weeks, while Tymoshenko had suggested the program may cost as much as 3 billion hryvnias.

At least 315 people died from flu-like illnesses in Ukraine over the past four weeks with 1.4 million sick, according to the Healthcare Ministry. At least 78,000 people are hospitalized, the ministry said.

The bill, which was backed by 401 lawmakers in the 450-seat legislature on November 3, called for the funds to be provided by the NBU, the measure that essentially amounts to money printing.

The money are supposed to go for purchasing medicines, such as Tamiflu, and vaccines, as well as purchasing equipment that identifies strains of flu viruses. (tl/ez)