May 2000 - Evaluating design alternatives is a first step in introducing optimal water subsidy schemes. The definition of appropriate targeting criteria and subsidy levels needs to be supported by empirical analysis, generally an informationally demanding exercise. An assessment carried out in...

May 2000 - An alternative to traditional subsidies for water and sanitation services is direct subsidies - funds governments provide to cover part of the water bill for households that meet certain criteria. Issues associated with such a subsidy are analyzed through a case study of Panama. As an...

Subsidies for utility services are widespread in the water supply, sanitation, and electricity sectors. One motivation is to improve social welfare of the poor by facilitating their access to and use of such services, as well as by redistributing resources to augment their purchasing power. At...

In developing countries the provision of water and sanitation services is often subsidized. These subsidies take the form of a general underpricing of water, numerous cross-subsidies, and inefficient billing and collection. An essential part of infrastructure reform is the redesign of subsidies....

Direct subsidies are an increasingly popular means of making infrastructure services more affordable to the poor. Under the direct subsidy approach, governments pay part of the water bill of poor households that meet certain criteria. This approach was first used in water sector reforms in Chile...

Reform of the water, electricity, and telecommunications sectors is gathering momentum in nearly all developing countries. Reform should include an assessment of whether subsidies are necessary and if so, how to design subsidies that reach their intended beneficiaries accurately and do not...