Output-Based Aid in Morocco (Part 1) : Extending Water Services to the Poor in Urban Areas

Morocco is a middle-income country with
good water infrastructure that provides access to safe
drinking water and sanitation to the majority of the urban
population. In 2005, Morocco made it a priority to extend
service to poor peri-urban settlements, and encouraged
operators and local governments to reduce connection fees
for their inhabitants. These connection fees had been priced
at marginal cost, which represented a major obstacle for
poor populations to connect to piped service. The government
and the operators of water utilities in Casablanca, Meknes,
and Tangiers consequently requested a grant from the Global
Partnership on Output-Based Aid (GPOBA) to pilot the
introduction of performance-based subsidies to encourage
service expansion under an innovative output-based aid (OBA)
approach. Initial results show that this approach is helping
to refocus service provision on household demand, which has
increased accountability, strengthened partnerships between
local authorities and operators, and made monitoring of
service delivery a priority. The World Bank is now working
with the government to plan a scale-up program.