In practice, it may be the workers employed in the informal sector that are most affected by large-scale reform to policy and delivery systems. Yet the impact on these poor rag-pickers, manual conservancy workers or water vendors is rarely addressed, and the PPP can have significant impact on a large group of self-employed workers. As there are no regulatory provisions that protect the rights of informal workers, there is little incentive for municipalities and private sector operators to formulate a plan that addresses the social impact of the arrangement on the informal sector and the livelihoods of those affected. Yet a pro-poor partnership should do just that, and it is within the power of the municipal partner to ensure that the partnership strategy and the arrangement formed address informal sector activities.
Notwithstanding the inexperience of large-scale private operators in working with poor small-scale providers, potential approaches might include:
• identification of the roles of small-scale providers in the overall partnership framework;
• support for regularisation/registration or licensing as necessary to accommodate their inclusion in the partnership arrangement (see 6.8);
• support for the development of micro-enterprises to take on direct service contracts either with the municipality or with the formal operator (see 6.9);
• targeted retraining and skills development and income generation activities to reorient activities;
• negotiated arrangements where informal sector providers continue to provide the service for an interim period; and
• capacity building initiatives for formal private sector actors to sensitise them to the potential of small-scale providers.
One of the primary concerns for informal sector providers in some cities is that their investment is expropriated. The arrangement must ensure that existing facilities (no matter how informal) cannot simply be absorbed by a new operator without some form of discussion and compensation, especially for poor informal providers. In Paraguay, the aguateros water merchants, described in Box 7.10, provide a significant and recognised service, but the recent proposal for a long- term concession arrangement has not considered how these merchants and their assets will be incorporated into plans to broaden the very limited water network.