Access to safe, sufficient and affordable water in rural Africa will not increase unless sustainable financing strategies are developed which ensure the sustainability of existing water services. There is a strong need for international donors and national governments to confront the true costs associated with sustained service provision in order to develop practicable long-term financing mechanisms. This paper presents a systematic approach that can be applied to determine the overall cost of service delivery based on respective cost estimates for operation and maintenance, institutional support, and rehabilitation and expansion. This can then be used to develop a tariff hierarchy which clearly indicates the cost to water users of different levels of cost recovery, and which can be used as a planning tool for implementing agencies. Community financing mechanisms to ensure sustained payment of tariffs must be matched to specific communities and their economic characteristics; a blanket approach is unlikely to function effectively. Innovative strategies are also needed to ensure that the rural poor are adequately served, for which a realistic, targeted and transparent approach to subsidy is required.

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