Ensuring full cost recovery for infrastructure services

Description

Ensuring full cost recovery for infrastructure services involves setting pricing and funding mechanisms so that all operational, maintenance, and capital costs are covered by user fees or other revenue sources. This strategy aims to prevent underfunding, service degradation, and financial shortfalls, while promoting efficient resource use and long-term sustainability. Remedies include transparent tariff structures, regular cost assessments, and targeted subsidies for vulnerable groups to balance affordability with financial viability.

Implementation

This strategy features in the framework of Agenda 21 as formulated at UNCED (Rio de Janeiro, 1992), now coordinated by the United Nations Commission on Sustainable Development and implemented through national and local authorities. Agenda 21 recommends promoting policies aimed at recovering the actual cost of infrastructure services, while at the same time recognizing the need to find suitable approaches (including subsidies) to extend basic services to all households.