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This paper covers several common goals of user charges: good governance, financial sustainability, distributive justice, economic efficiency, and fair pricing.

TitleBeyond cost recovery : setting user charges for financial, economic, and social goals
Publication TypeBook
Year of Publication2004
AuthorsDole, D., Bartlett, I.
Secondary TitleTechnical note /ERD-ADB
Volumeno. 10
Pagination38 p. : 3 tab.
Date Published2004-01-01
PublisherAsian Development Bank
Place PublishedManila, Philippines
Keywordseconomic aspects, financial management, sdiman, social aspects, sustainability, tariffs, water supply charges
Abstract

This paper covers several common goals of user charges: good governance, financial sustainability, distributive justice, economic efficiency, and fair pricing. It shows that these goals can be pursued jointly by following three steps: (i) set usage charges for distributive justice and economic efficiency; (ii) if additional revenue is required for financial sustainability, set fixed charges for sustainability and fairness; and (iii) increase or adjust charges at a rate consistent with good governance. The resulting user charge depends on circumstances, but is always simple and familiar. The approach suits whatever goals the public chooses for setting user charges, and is not particular to the five considered in this paper.

Notes45 ref. Includes glossary

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