Level Of Cost Recovery Research Articles

Economic burden of tobacco use in Pakistan

BackgroundThe lack of reliable tobacco healthcare and economic cost estimates leaves the tobacco industry undertaxed and thriving in Pakistan and makes the country as one of the top tobacco-consuming nations....

Efficiency of non-revenue water reduction in improving water supply performance in Indian metropolises

Abstract Many cities around the world face water crisis. Poor management contributes more to water crises than resource constraints. Multiple Indian metropolitan cities face severe water crises. These cities usually have high non-revenue water (NRW) levels. The present study estimates the efficiency of the extent of NRW management to improve per capita water supply (PCS) and cost recovery (CR) in 55 Indian metropolises with more than one million population. The study considered variable-returns-to-scale data envelopment analysis (DEA) using input orientation (I/P DEA). NRW has been used as the input variable, while the PCS and CR are studied as the output variables. The DEA model recommends that reduced NRW levels can address the water crisis in Indian cities. According to the DEA findings, about 38 Indian cities (68.09%) could reduce NRW levels by more than 50% while improving PCS and CR levels substantially. Around 47 cities (85.45%) can fulfil the water supply benchmark value of 135 litres per capita per day (lpcd). Three cities can improve the cost recovery by more than 100%. The findings suggest that water supply utilities in Indian cities should focus on reducing NRW levels substantially to improve the PCS and CR.

Can an energy-only market fully remunerate investment? Empirical evidence since 2005

The challenges of relying upon the Energy-Only Market (EOM) to remunerate power plants have been widely discussed. However virtually no empirical information is available showing what percentage of fixed costs have been recovered from the wholesale market alone in the European Union (EU). This paper presents the results of a detailed investigation into the cost recovery for thermal, nuclear, and renewable plants in France and Germany (representing 37% of the EU market) between 2005 and 2019. It shows that only second-generation nuclear plants recovered their full costs; the average level of cost recovery was 40% for combined-cycle gas turbines (CCGTs), 55% for coal plants, 30% for wind plants and 60% for utility-scale solar plants. As an alternative means of profitability determination the internal rate of return (IRR) was estimated. It was negative for CCGTs and wind plants; coal plants recorded a level of 2–3%, nuclear plants 7–8% and PV plants 0–2%, and should be compared with a typical utility cost of capital of 7%. The results are important for future market design and show that without changes, investment relying on the wholesale market alone in both renewable plants and dispatchable plants needed to accompany them will be difficult.

Economic costs and investment challenges of water infrastructure in South Africa

South Africa is facing significant water infrastructure investment challenges, at the levels of both water resources and services. Principles for water use pricing, charges, tariffs and use are enshrined in South African legislation, but implementation thereof is a major problem. This research paper addresses (a) economic costs, (b) efficiencies, (c) investment challenges and (d) the application and maximisation of economic tools. A total of 269 municipalities were sampled, and the research exemplified that South Africa was losing approximately US$0.617–1.033 billion/annum to various inefficiencies: (a) water use underpricing was approximately US$0.413 billion/annum. Water use charges and/or tariffs closer to cost-recovery levels would provide and ensure financial sustainability. (b) Return on capital investment inefficiencies contributed approximately US$0.926 billion/annum. Revenue far lower than the asset value is illustrative of unsustainable revenue for investments. (c) Non-revenue water was 36.8% and approximately US$0.402 billion/annum. Investments in water infrastructure maintenance projects will minimise distribution losses. (d) The multipliers were varied and substantially high – namely, 3–27. This illustrates the extent and seriousness of prioritising the implementation of water conservation and demand-management measures. (e) The capital investment gap was estimated at US$2.258 billion/annum for the next 10 years (2019/2020–2029/2030). Under-capital investments have serious downstream implications for socio-economic development and growth.

Income formation of hunting farms of Zaporizhia region

The relevance of the study of the dynamics and structure of income of hunting farms in the region. It is determined that this study is one of the main tasks of the analysis of enterprise income. The classification and structure of incomes of hunting farms are given. The dynamics in the formation of the number of users of hunting lands of Zaporizhia region and their structure in terms of state enterprises, public organizations and private enterprises are analysed. There is a tendency to reduce the area of hunting grounds in state farms and public organizations and increase – in private enterprises. An analysis of the financial performance of hunting farms in general, which showed that the level of cost recovery income in the Zaporizhia region among other regions of Ukraine is one of the highest. A similar analysis in terms of different organizational forms of hunting management showed the lowest level of cost recovery for users who belong to other private and public hunting organizations. In 2019 it was 55.9 % compared to 63.8 % in the organizations of the Ukrainian Society of Hunters and Fishermen and 74.4% in the enterprises of the State Forest Agency of Ukraine. The structure of sources of income of hunting farms is given, among which the main ones are income from the sale of licenses for hunting animals, sale of shot cards for fur, sale of shot cards for game birds, sponsorship, and other income. The dynamics of the total number and number of captured wild animals by their different species is analysed. It is shown that the most significant share of income of hunting farms in Zaporizhia region is provided by the number of ungulates, which remains low in the region. During the period from 2015 to 2019, it decreased from 52 to 19 animals. It is established that the formation of income of hunting farms is influenced by the following negative factors: high level of poaching, shadow component of the economy, imperfection of the legal framework and statistical reporting, reduction of hunting grounds, reduction of ungulates, insufficient number of qualified specialists. The study found that the almost complete lack of state support for the hunting industry has led to a decrease in the interest of hunting land users in the efficient and rational use of natural resources of the region.

Assessing the Performance of Water and Sanitation Tariffs: The Case of Nairobi, Kenya

AbstractPolicymakers and utility managers can use a variety of tariff structures to calculate customers' bills for water and sanitation services, ranging from a simple fixed monthly fee to complicated multi‐part tariffs with seasonal pricing based on metered water use. This study examines the performance of several alternative tariff structures for water and wastewater services in Nairobi, Kenya using a dynamic tariff simulation model applied to a complete set of billing records from Nairobi City Water and Sewer Company. Simulations show that a uniform volumetric price tariff structure performs as well as or better than several increasing block tariff (IBT) structures across the six performance metrics considered (customer welfare, social welfare, cost recovery, the subsidy delivered through the tariff, subsidy incidence, and water conservation). These findings are robust to changes in the level of cost recovery. This finding challenges the wisdom of the widespread use of IBTs in low‐ and middle‐income countries and current perceptions of best practice in tariff design.

Assessment of the international competitiveness of the corporate profit tax in Ukraine

The article is devoted to assessing the international competitiveness of the corporate profit tax system based on the approach of the US Tax Foundation, which develops International Tax Competitiveness Index of the corporate profit tax (ICI) and takes into account the level of profit tax rates, cost recovery, tax incentives and complexity of tax law. According to the analysis of the international ranking of OECD countries, Estonia, Latvia, Lithuania, and Hungary had the highest ICIs in 2019-2020. The main factors that have had a positive effect on their competitiveness are the low top marginal income tax rate, unlimited loss carryback and carryforward, no restrictions on the list of assets subject to depreciation, as well as the use of accelerated depreciation, which allows companies to compensate for a larger share of the initial value of assets, LIFO inventory or at least inventory by the weighted average cost method, no Patent Box; no tax credit for R&D, and low corporate profit tax complexity. The calculation of the ICI for Ukraine, based on the approbation of the methodological approach of the Tax Foundation, found that in 2019-2020 Ukraine with a total score of 55.07 took 24th place out of 35 OECD countries. The author characterizes the main components of Ukrainian corporate profit taxation in terms of their impact on international competitiveness; in addition, ways to increase ICI are substantiated.

Macroeconomic Instabilities and Cost-Recovery Potentials of Public Sector Organisations

The 2008 financial crisis aroused concerns over the performance of public sector organisations operating under different cost recovery regimes. These concerns were linked to potential failure in attaining cost recovery targets as a result of declining revenues during economic downturn. Using LME models on data from the World Bank website and from six Land Administration Organisations (LAOs), it is established that a global financial crisis that is associated with declining GDP and higher inflation rate can insignificantly reduce the level of cost recovery for LAOs while persistent decline in GDP growth rate significantly eliminate potentials for cost recovery. However prospects for recovery can be traced within the cost-revenue microstructures of LAOs themselves. With a significantly negative relationship between spending in information and technology as a ratio of GDP to the degree of cost recovery, LAOs need only to eliminate rigidities in their cost-revenue structure which tie them to macro-instabilities of the real estate market. Such flexibility can be attained through elastic cross-substitution in the LAO’s gross cost-revenues schedules for registration tasks in favour of information delivery tasks.

Оцінка міжнародної конкурентоспроможності системи оподаткування прибутку підприємств України

The article is devoted to assessing the international competitiveness of the corporate income tax system based on the approach of the US Tax Foundation, which develops International Tax Competitiveness Index of the corporate income tax (ICI) and takes into account the level of income tax rates, cost recovery, tax incentives and complexity of tax law. According to the analysis of the international ranking of OECD countries, Estonia, Latvia, Lithuania, and Hungary had the highest ICIs in 2019-2020. The main factors that have had a positive effect on their competitiveness are the low top marginal income tax rate, unlimited loss carryback and carryforward, no restrictions on the list of assets subject to depreciation, as well as the use of accelerated depreciation, which allows companies to compensate for a larger share of the initial value of assets, LIFO inventory or at least inventory by the weighted average cost method, no Patent Box; no tax credit for R&D, and low corporate income tax complexity. The calculation of the ICI for Ukraine, based on the approbation of the methodological approach of the Tax Foundation, found that in 2019-2020 Ukraine with a total score of 55.07 took 24th place out of 35 OECD countries. The author characterizes the main components of Ukrainian corporate income taxation in terms of their impact on international competitiveness; in addition, ways to increase ICI are substantiated.

Production Cost of the Farm-Ready Pearl Oyster Pteria penguin Used for Mabé Pearl Production in the Kingdom of Tonga

Mabe pearl (half-pearl) culture provides rural livelihood opportunities in the South Pacific and is a low-tech alternative to capital and labor-intensive round pearl culture. The Kingdom of Tonga is unique among the pearl-producing countries of the South Pacific in focusing on mabe pearl culture using the winged pearl oyster Pteria penguin. The Tongan mabe pearl sector is developing rapidly and stimulated by routine supply of spat to mabe pearl farmers, from the government hatchery at no cost. It is likely that some level of cost recovery for spat supply will be considered as the sector strengthens, but information on hatchery production costs is limited. This study determined the costs of operating the government pearl oyster hatchery in Tonga and developed an economic model to assess the production cost of juvenile oysters. Modeling was based on a single annual hatchery run generating 6,600 oysters from the ocean-based nursery for delivery to commercial pearl farms. Estimated capital cost was USD 19,079 (excluding government buildings and chattels), and the major production costs were hatchery labor (37%), capital purchase and replacement (20%), and nursery labor (10%). Total annual costs for the pearl oyster hatchery were USD 13,263, equating to a cost of USD 2.01 per oyster supplied to farmers in Tonga. Given significant annual profits of around USD 9,338 that can be generated from 100 harvested oysters, there is justification for cost recovery. Results will be valuable to key stakeholders and have regional relevance for hatchery production of high-value aquaculture commodities.

Prospective Models for Water Service Demand and Price Analyses

One way to address the practical challenges of the current problems of water services is through demand-side measures. These types of measures impact on demand through price changes or on water use control, considering that the impacts of these measures would be extremely useful in order to implement an adequate policy mix. One of the objectives of this paper is to show the possibilities of water management tools, particularly the use of prospective prices and demand models, in order to anticipate scarcity scenarios. This can best be done using better predictive models. Current computer tools provide a good basis for developing applications to perform prospective analysis on water prices and demand. Through simulation, we can try to optimize financial flows of costs and revenues based on the behavior of certain variables. This aims to find a better combination of price levels for urban water uses, making it possible to adjust the chargeback mechanisms, the level of cost recovery of investments, and the allocation between user types. This paper aims to show the advantages of these tools and illustrates its usefulness with a registered model that allows simulations of potential scenarios resulting from certain management measures.

STATE AND DEVELOPMENT PROSPECTS OF THE OILSEED-PRODUCT SUBCOMPLEX OF THE AGRO-INDUSTRIAL COMPLEX OF UKRAINE

Introduction. The main oilseeds of Ukraine are sunflower, soybean and rapeseed (winter and spring) - in 2019, their share in the structure of oilseeds is 99.3% of the sown area. In different years, the profitability of their production ranges from 25 to 50%, providing one of the highest levels of cost recovery in domestic agricultural production. This is the main reason for the stable growth of sown areas under oilseeds. Purpose. The purpose of the study is to assess the state and development prospects of the oil and food subcomplex of the agro-industrial complex of Ukraine in terms of the national economy increasing openness. Results. The article examines the state of agricultural production and industrial processing of seeds and oilseeds in Ukraine. There is a rapid growth of sown areas under the respective crops. Significant reserves of increase in production of sunflower, soybean and rapeseed due to increased yield are substantiated. The redundancy of the share of sunflower crops in the structure of sown areas is noted. It is assumed that a serious shortcoming in the development of the oil and food subcomplex is the excessive export volume of rapeseed, which is more appropriate to use for domestic processing to meet the needs of domestic consumers in scarce motor fuel. Conclusions. The main type of raw material in the field of industrial processing of oilseeds are sunflower seeds. Excessive sales of sunflower seeds abroad were redirected for domestic processing due to the introduction of export duties. Among the factors hindering the full development of the domestic oil market is its non-competitive structure. For the development of industrial processing of rapeseed, it is necessary to introduce an appropriate export duty of 10% and not to reimburse VAT on rapeseed exports. For the development of domestic biodiesel production, it is necessary to create clear and transparent legislation that establishes a long-term model of the industry, defining the basic rules of market participants, requirements for marketable products, creating conditions for the formation of logistics and infrastructure for collecting biological raw materials, transportation, production of second-generation biofuels. Keywords: sunflower, soybean, rapeseed, area, yield, oil, monopoly, export, raw materials, biodiesel.

Analysis of irrigation water tariffs and taxes in Europe

Abstract Water taxation in European Union (EU) countries is adapted to local conditions and institutional trajectories and contains a variety of taxes and tariffs to finance water services and induce a higher use efficiency. After having clarified certain concepts, this work offers an overview of water taxes and tariffs charged for agricultural water use in several European Union member states, both in water-abundant areas and in water-scarce regions. Mediterranean countries, such as France, Portugal, Italy and Spain, have implemented different tax systems on agricultural water abstractions to recover the costs of the regulation, storage, and management of basin-level water services with various levels of cost recovery in accordance with the provision by the Water Framework Directive. France, Portugal, and Italy have implemented an abstraction tax applied to any water source (surface and groundwater) as an instrument to induce water saving and internalize environmental and resource costs in the irrigation sector. Despite these efforts, current taxation remains very low in the European context. On the other hand, Northern European countries (including the Netherlands, Germany and Denmark) have no fiscal instruments related to agricultural abstractions (neither for surface nor for groundwater resources).

Public-Private Partnership: Ghanaian Perspective of Urban Water Supply

In Ghana, tariff of utilities including water is put below cost recovery levels such that government is unable to cope with the challenges in water supply. As such, the government resorts to private partnership to fund the gaps in the urban water supply in the country. The study adopted an integrative multi-stage critical review of relevant literature on public-private partnership in urban water supply. As such articles published between 2006 and 2017 were selected by specific inclusion criteria. Relevant articles on the topic were identified through references and citations. The paper examines the status and trend of water supply, reforms and management of urban water supply in Ghana. The study found problems like poor water supply system, inadequate human and economic resources as well as poor resource allocations and urban water management.

Financial Sustainability and Cost Recovery in Small Towns Water Systems in Eastern Region of Ghana

The sustainability of water facilities is one of the major challenges in the delivery of safe water to rural communities and small towns in Ghana. This study therefore aimed at assessing the financial sustainability of the small towns water systems in the Eastern Region based on the level of cost recovery. Secondary Data collected from various STWS were used. Variables of interest were analysed using descriptive statistics and a random effect regression, and a pooled logit regression. Interviews were also conducted. The study found more than 50% of the STWS in Eastern Region are unable to raise their expected revenue. Again, the study revealed that most STWS are relatively efficient, having positive net-incomes after all expenditures, and improved remuneration and regular maintenance helps to improve revenue from STWS. Further, majority of the STWS are financially sustainable because the operation, maintenance costs and the capital maintenance costs are all recovered from tariffs. It was revealed that user financing of full implementation costs for STWS is an unrealistic goal and that cost recovery for on-going service delivery, recurrent operation, and maintenance may be a more achievable target. It is recommended that the WSMT managing the STWS should be equipped with financial management skills for effective management of the revenue generated from the STWS. They should undertake regular maintenance and repairs and improve staff remuneration to increase productivity, improve revenue generation, and enhance the financial sustainability of the STWS. The Municipal and District Assemblies should monitor the activities of the WSMT and provide technical support in terms of budgeting, financial reporting and auditing of their accounts to contribute to the financial sustainability of the STWS.

A Burgeoning Crisis? A Nationwide Assessment of the Geography of Water Affordability in the United States.

While basic access to clean water is critical, another important issue is the affordability of water access for people around the globe. Prior international work has highlighted that a large proportion of consumers could not afford water if priced at full cost recovery levels. Given growing concern about affordability issues due to rising water rates, and a comparative lack of work on affordability in the developed world, as compared to the developing world, more work is needed in developed countries to understand the extent of this issue in terms of the number of households and persons impacted. To address this need, this paper assesses potential affordability issues for households in the United States using the U.S. EPA’s 4.5% affordability criteria for combined water and wastewater services. Analytical results from this paper highlight high-risk and at-risk households for water poverty or unaffordable water services. Many of these households are clustered in pockets of water poverty within counties, which is a concern for individual utility providers servicing a large proportion of customers with a financial inability to pay for water services. Results also highlight that while water rates remain comparatively affordable for many U.S. households, this trend will not continue in the future. If water rates rise at projected amounts over the next five years, conservative projections estimate that the percentage of U.S. households who will find water bills unaffordable could triple from 11.9% to 35.6%. This is a concern due to the cascading economic impacts associated with widespread affordability issues; these issues mean that utility providers could have fewer customers over which to spread the large fixed costs of water service. Unaffordable water bills also impact customers for whom water services are affordable via higher water rates to recover the costs of services that go unpaid by lower income households.

Examining Implementation and Labor Market Outcomes of Targeted Transit Subsidies: Subsidy by Sistema Nacional de Selección de Beneficiarios for Urban Poor in Bogotá, Colombia

To meet the challenges of providing affordable public transit service without compromising the financial sustainability of the system, many transit systems are setting fares at cost-recovery levels. However, to offer affordable transport service for the urban poor, cities can provide targeted subsidies. Bogotá, Colombia, has implemented a pro-poor public transit subsidy scheme that leverages the adoption of smart cards in its new public transit system and the country’s poverty-targeting instruments. This study presents a critical analysis of the rationale, design, and implementation of Bogotá’s public transit subsidy. On the basis of this experience, two research questions were explored: What are the determinants of the user’s self-selection? What are the causal links between the subsidy and labor market outcomes of employment and income? Two regressions (linear and probabilistic) were used to identify the characteristics of individuals who choose to request the subsidized fare. A quasi-experimental technique was used for the impact assessment of the subsidy on labor market outcomes. This research allows an understanding of how to design targeted subsidies for maximum labor market outcomes.

Ensuring Sustainable Access to Drinking Water in Sub Saharan Africa: Conflict Between Financial and Social Objectives

Summary We study a model explaining dynamics in water coverage that accounts for financial performances of utilities. Our dataset covers 25 Sub-Saharan countries from 1996 to 2012. Results suggest that access to water depends upon financial results, but this relationship is not linear: we find important access increases for relatively low levels of capital cost recovery and deterioration of access performances beyond a certain threshold. Our results are consistent with the literature about risks of corporatization and potential conflict between financial and social objectives in the water sector, and they provide supporting quantitative evidence and recommendations for sector policies in the region.

Willingness-to-Pay for Potable Water in the Accra-Tema Metropolitan Area of Ghana

A major problem confronting the Accra-Tema Metropolitan area of Ghana is the provision of potable water supply. One reason for this occurrence is the inability of Ghana Water Company Limited to meet the growing demand. This can partly be attributable to the ineffective pricing by the PURC which is below cost recovery levels. In this study we investigate household’s willingness-to-pay (WTP) for potable water supply together with the factors that determine WTP by using the Contingent Valuation Method (CVM). The results indicate that households in the Accra-Tema metropolis are willing to pay on the average GH￠0.10 for a bucket (17.5 litres) of water which is about 7 times more than what they are paying currently. Analysis of the factors that influence households WTP indicates that income, time spent to fetch water from existing sources, level of education, sanitation facility, perceived quality of current water supply, sex of the respondent and marital status are the main factors influencing households WTP for potable water supply services in the metropolis. We recommend that government improve water supply and increase tariffs since people are prepared to pay more for potable water supply as well as reduce inefficiencies that exist in the sector.

Article 9 of the eu Water Framework Directive

Article 9 of the eu Water Framework Directive (wfd) requires Member States to take account of the principle of recovery of the costs of water services, including environmental and resource costs (ercs). Whilst legally the Member States have broad scope for discretion when applying Article 9, the idea that the eu legislator has effectively assigned the Member States a mathematical task to determine the level of cost recovery achieved for environmental and resource costs is increasingly gaining ground in the Common Implementation Strategy (cis) process. The present paper shows that this strict interpretation of taking account of environmental and resource costs has no basis in Article 9, is conceptually misleading, and could even prove counter-productive for the practical application of water protection.