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Innovative Rural Wastewater Management
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8.4.3 Subsidy Partnerships with Local and Community Cost Sharing
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8.4.3 Subsidy Partnerships with Local and Community Cost Sharing

  • Categories: 8.4 Subsidies
  • Time of issue: 2022-04-28 10:59:22
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A well-designed financial strategy can mobilize household and community resources through full or partial cost sharing and technical innovation. In other words, public subsidies can be used to leverage much greater investment if they are used along with other sources of funds for more appropriate goods and services. This approach recognizes that subsidies are most effectively spent on promotion, enabling, planning, community participation, education and training – commonly referred to as the software costs – with limited or targeted funding directed to infrastructure or hardware where required. Leveraging household and community finances requires a shift in funding away from direct or infrastructure subsidies to alternatives, such as subsidized credit, support for small-scale providers and more focused and efficient funding of public elements and infrastructure. In an environment of scarce resources, public funds go further if they are targeted in ways that encourage investments from other sources. However, leveraging of local funding requires an understanding of what households themselves are willing and able to invest. Initiating a successful cost sharing approach will empower the community and households to take active ownership and long-term responsibility of the investment. Although these investments may be difficult for individual households in the short run, the long-term gains to sanitation will improve the local economy through improved public and environmental health conditions.

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