State government and municipalities also provide financial support for irrigation (see Figure 3.11). As discussed earlier, agricultural water users are exempted from paying water abstraction charges and even the “penalty” rate paid for above-quota abstractions is significantly lower that the general rate. This means that agricultural water users do not have a direct incentive to reduce water abstraction and that irrigation districts do not have an incentive to control water demand by individual farmers. Retail irrigation charges, although theoretically based on the volume of water used, are normally calculated per hectare because of the lack of water measuring devices (World Bank, 2009).