Concepts of the Chilean Sanitation Legislation: Efficient Charges and Targeted Subsidies

Abstract

Sanitation services in Chile were controlled by the federal government until 1988. Prior to this period, the services were somewhat inefficient, the tariffs were low, and a universal subsidy was provided to all users, irrespective of their economic conditions. During 1988, 1989 and 1990, new laws for water supply and sanitation were enacted. These laws were based on the following considerations: companies would be given concessions to provide water and sanitation services; the tariffs would ensure the economic viability of these companies; and the subsidies would target the poorest sectors of the population. A legal institution, the Sanitary Services Office, was also established. This body has been subsequently modified according to the needs of the country, and is still under operation.