Water subsidies mostly benefit the wealthy

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Water subsidies disproportionately benefit higher-income households—a result consistent across the 10 countries analyzed in the recent World Bank report, Doing More With Less - Smarter Subsidies for Water Supply and Sanitation.

Across the 10 countries analyzed—Ethiopia, Mali, Niger, Nigeria, Uganda, El Salvador, Jamaica, Panama, Bangladesh, and Vietnam—existing subsidies tended to target networked services. Since many poorer households rely on water and sanitation access that are not connected to their homes, there is a disproportionate focus of existing subsidies that benefit wealthier families.

An average of 56% of water and sanitation subsidies go to the wealthiest 20% of the population (upper two deciles), while 6% reach the poorest 20% (lower two deciles).

The authors of the report outline pathways that policy makers can design “smart”, “targeted”, and “efficient” water and sanitation policies to make scarce public resources reach the poorest households.

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