Phase 1 constitutes the preparatory phase allowing the municipalities of Jagodina, Kikinda, Pančevo, Pirot, Požarevac, Smederevo, Trstenik and Vršac to receive institutional management support to enhance their capabilities and enable them to participate in the investment phase (Programme VI, Phase 2) once they fulfil the performance criteria.

Success indicators, objectives and outputs for this programme are:

• Quality of the receiving water courses is improved

• Costs of water supply and wastewater services are affordable

• Rehabilitated, extended and new wastewater collection infrastructure is operational

• Rehabilitated, extended and new wastewater treatment infrastructure is operational

• Public Utilities are able to operate and maintain the water systems efficiently and professionally

• Public Utilities are able to cover operation costs and basic reinvestments