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Matrices of State Rules and Schemes under the Street Vendors Act, 2014
The Indian Parliament enacted the Street Vendor (Protection of Livelihood and Regulation of Street Vending) Act in 2014, to prevent harassment of street vendors and to regulate their livelihood. Given the important role played by local authorities in regulating street vending, the Act delegates rule-making powers to the State Government. It specifies the respective authorities for making rules, schemes and bye-laws, neatly delineates the rule-making heads/matters for each of these and specifies the timeline for enacting them. While State Governments are tasked with framing rules and formulating schemes, municipal authorities have to enact bye-laws.
Apart from shaping local governance, the content of State schemes and rules have a bearing on the vendors’ right to occupation and the duties imposed on them. While the parent Act sets the contours for regulation, States vary in the way they adopt, interpret or elaborate on the different aspects of street vending.
We have prepared two matrices that feature cross-tabulation of all state rules and schemes under the Street Vendors Act, 2014. These matrices are user-friendly tools that facilitate a comparison between States based on the different ways in which they approach the same rule-headings, under the parent Act.
Section 36 (2) of the Central Act directs the states to notify rules within one year from the date of commencement of the Act. Sub-sections 2(a) to 2(r) outline the matters that the rules may address. These include the dispute redressal mechanism, the constitution and functioning of the Town Vending Committee (TVC), record maintenance, social audit and the returns to be furnished.
The matrix on State rules clubs these 19 rulemaking heads under 5 categories. These 5 categories are further classified into smaller specifications to provide clause level summaries of the different State provisions. Some columns are empty. Since the parent Act does not mandate the rules to deal with all matters, some states have not introduced any provisions for specific matters.
Per section 38, states should draft and notify the scheme within 6 months from the commencement of the Act, in consultation with the TVC and the local authorities. The second schedule of the Act elaborates on the matters that the scheme may address. This includes laying down the process for conducting the survey, issuing identity cards and certificate of vending, the guidelines for earmarking vending zones, vending regulations for different categories of vendors, provisions regarding vending fee and the relocation and the eviction of vendors.
The matrix on State schemes clubs these 29 rulemaking heads under 13 categories. These are further classified into smaller specifications to provide clause level summaries of different scheme provisions.
Rethinking K-12 Assessment Framework
There are inherent information asymmetry problems in education that are characterised using the lens of the principal-agent framework. Principal-agent problems exist when the principal hires an agent to act on her behalf but the interests of the principal and the agent are not perfectly aligned. This necessitates that the principal has information to monitor the agent’s effort. Typically, in education, there is information asymmetry between parent-child, teacher-child, parent-school/teacher, parent-administrator, administrator-administrator, and administrator-teacher. Administrator means administrator at different units—school, block, district, state and nation (Bergbauer, Hanushek, and Woessmann 2018). These principal-agent problems can be linked to different uses such as child diagnosis, child progression into university, school information to parents, school regulation, teacher evaluation and so on (Figure 1).
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Figure 1: Tree of principal-agent problems and different information uses; Adapted from Bergbauer, Hanushek, and Woessmann 2018
A common solution to some of these information gaps is to use learning outcomes assessment. In the two decades preceding 2020, India has had some measures of learning outcomes. These include initiatives by the government institute, National Council of Educational Research and Training (NCERT); non-governmental organisation, Pratham; state governments; and private organisations such as Educational Initiative. In addition to national assessments, Tamil Nadu and Himachal Pradesh also participated in the OECD’s Programme for International Student Assessment (PISA) in 2009. Besides these, we also have in-class assessments.
Although the proliferation of multiple assessment organisations and tools is commendable, the assessments have had a limited impact on driving change in school or administrative practices. There is a lack of systematic thinking on the question of the right tool and the right use. This is evident by the low learning outcomes across the country, despite years of assessments pointing in the same direction. This requires a rethink of the assessment framework—what are the different tools and tests available currently, how may they be best used to fill the existing information gaps and what gaps remain to be filled with new tools.
Assessments that solve one kind of information problem may not be suitable for another. For example, tests that evaluate children for progression to university, such as board exams in India, are different from tests that evaluate schools or tests that evaluate teacher performance. The conflation of multiple uses in one is seen for assessments such as Board exams. Board exams are designed to assess child performance for progression but have been at times used as indicators of school performance. Unless we isolate the child effort and background from school effort, board exam results are not valid indicators of school effort.
The latest draft of the National Education Policy released in 2019, led by Dr Kasturirangan, proposes multiple ideas to reform existing assessment practices and also introduces new ways to employ assessments. The document lays out a number of new test uses—low stakes assessments to personalise teaching, national achievement survey for periodic health check-up, census assessment for disclosing school performance and board exam reforms for student progression. Yet, even as the draft policy lays out these different tests, it lacks lucidity on the problem each of these tests solves, the information gap it fills, and the use it will be put to. Critical terms such as ‘developmental purposes’ and ‘health check-up’ remain vague and open for interpretation. In light of these developments, it is critical to identify clear and plausible objectives of each test that we carry out currently. What are the principal-agent problems NAS can solve? What are the principal-agent problems board exams solve? What is the role of in-class tests? How can census assessments be used for school accountability? To answer these, we need to tackle each principle-agent problem systematically—parent-child, parent-teacher, teacher-child, parent-administrator, administrator-teacher.
This brief looks at three uses of information, i.e., school information to parents, school regulation, and system health, and explores the role of assessments in each.
Enumerating Street Vendors in Mumbai, Maharashtra
Municipal Corporation of Greater Mumbai [commonly known as Brihanmumbai Municipal Corporation (BMC)], responsible for regulating street vending in Bombay, has been grappling with the ‘street vendor nuisance, encroachment and other illegalities’ since at least the 1880s. According to the Government of India, there are around 2,50,000 vendors in Bombay. Their rights are protected under the Street Vendors (Protection of Livelihood and Regulation of Street Vending) Act 2014. This Act empowers a participatory committee called Town Vending Committee to regulate street vending, conduct a survey of all street vendors and formalise them.
There are four major challenges in the way the Government of Maharashtra has implemented this Act.
First, Rule 22 of the Maharashtra Street Vendors (Protection of Livelihood and Regulation of Street Vending) (Maharashtra) Rules, 2016 empowers the Municipal Commissioners and the State Government to veto TVC proposals. This veto power dilutes participatory governance and may be misused to make the TVC dysfunctional. This veto power is against the Street Vendors Act, 2014 as the Act expressly supersedes all other local laws. Deciding whether a proposal by the TVC violates another law is a judicial function and vesting the power of judicial review in an executive body is also a violation of the doctrine of separation of powers.
Second, six years have passed since the enactment of the Street Vendors Act, 2014 but the Government of Maharashtra has still not formulated a statutory scheme as per the mandate of the Act. Although the Government formulated a scheme in 2017, Azad Hawkers Union challenged it on the grounds that the scheme was not framed in due consultation with the local authority and TVC. Bombay High Court ruled that the scheme is not legitimate as it did not comply with the consultation mandate.
Third, the 2014-Vendor survey did not comply with any statutory requirement - either with the Street Vendors Act, 2014 or with 2009-Policy. In Azad Hawkers Union 2017, street vendors argued that a survey is not possible in the absence of TVCs with duly elected members and that without the survey, street vendor elections cannot be conducted. Bombay High Court called it a chicken- egg question and addressed this legal conundrum by ruling that the first elections to the TVC may be based on the surveys conducted under the 2009 Policy. The 2009 Policy prescribes a census like survey and hiring of a professional agency for conducting the survey. But the 2014-registration drive was based on application submission and not census-like survey. BMC merely distributed forms and asked the vendors to submit the filled form later, along with other documents. Also, BMC did not hire any professional agency to undertake a survey.
Fourth, even though the Street Vendors Act, 2014 does not prescribe requirements like domicile certificate for the purpose of registration and licensing, the Government of Maharashtra has added a domicile certificate to the list of required documents. This requirement has brought down the number of eligible street vendors from 23,265 to 5,000 only.
Another exclusionary policy is the ban on roadside cooking. Previously the Municipal Commissioner had advocated for a ban on the vending of any cooked food articles. But the Supreme Court in Bombay Hawkers Union case found such a condition to be an unreasonable restriction. This issue has been repeatedly discussed both in the Supreme Court and the Bombay High Court. With the enactment of the Street Vendors Act, 2014, no such restrictions were placed on roadside cooking or the sale of cooked food. Yet, on 23 October 2015, Bombay High Court refused to accord protection to those vendors who cook food at the place of street vending. The judiciary is therefore reading a prohibition in the law that the Parliament has not legislated.
How to: Design a separate independent regulator for all schools
The Kasturirangan Committee Report 2019 proposes that “the three distinct roles of governance and regulation, namely, the provision/operation of education, the regulation of the education system, and policymaking, will be conducted by separate independent bodies, in order to avoid conflicts of interest and concentrations of power, and to ensure due and quality focus on each role.”
In our view, separating the regulatory and service delivery functions performed by state school education departments/directorates and creating state-level independent regulators for all schools is the most significant reform proposal in the Report for school education.
As per the Report, each state should set up a State School Regulatory Authority (SSRA) to regulate all schools, public and private, on the same set of minimum standards to assure quality education for all. The revised state education administration structure envisaged under the Report is:
the existing Directorate of School Education (DSE) to oversee government schools operations;
a newly-formed State School Regulatory Authority (SSRA) to have exclusive responsibilities over rule-making for all schools, public and private, and ensuring compliance;
the Department of School Education to be the primary institution for overall monitoring and policymaking (without any involvement in service delivery or regulation).
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Figure 1: Governance and regulatory architecture of School Education post-NEP 2019
Promise and perils of State School Regulatory Authority
Independent regulation will likely bring competitive neutrality, focus and efficiency. A dedicated regulator for a marketplace of a variety of suppliers, public and private, is an approach increasingly followed in India and several other countries. Conflicts of interest that currently exist between a government service-provider regulating itself and other service providers will be contained. SSRA, as a regulator, will function separately from any government department. As a result, the role played by discretion and quid pro quos in licensing, school recognition, inspections and fee regulation can be minimised. SSRA will be mandated to draft specialised rules only for the K-12 sector. This can encourage a symbiotic relationship where the regulator receives feedback on the efficacy of its rules from regulatees and consumers.
However, an independent regulator makes rules, checks compliance, and enforces the rules. This fusing of powers vests extensive authority in unelected officials. It needs to be countered by assigning the regulator a limited and well-defined mandate and developing an agency design accountable to Parliament/Legislature, regulatees, and parents and children whose interests it is to protect.
Design Elements for an effective State School Regulatory Authority
In this How To Note, we discuss the five design considerations that should go into the setting up of SSRA:
Defining clear and narrow objectives: Assessment of SSRA’s performance, metrics to hold it accountable, governance structure, and management processes, all hinge on a clearly articulated objective. This objective should be limited and measurable, and subscribe to the principle of regulatory neutrality.
Preparing a legislative framework delegating authority to the regulator: Since SSRA will be at the state-level, the state Legislative Assembly has to pass the Act enabling its creation. Furthermore, the powers relating to K-12 education are currently scattered across numerous Union and state Acts, and enforced by different officers and agencies. These need to be brought under the purview of SSRA to avoid regulatory cholesterol from building up.
Structures that ensure independent functioning of SSRA: Independence will insulate SSRA from regulatory capture while making room for guided discretion. Moreover, it will allow SSRA to be held accountable for its decisions. This can be achieved by making appointment process for its Board members transparent, maintaining a balanced and lean Board composition, instituting working processes that incentivise performance, and imposing term limits on Board members to minimise conflicts of interest.
Setting up accountability measures for performance via internal separation of functions and information disclosures on processes; and
Establishing checks on executive discretion and against the abuse of power: Since SSRA will be formed by fusing quasi-legislative, executive and quasi-judicial powers, fail-safes against potential abuse of power must be instituted. Only its Board must hold rule-making powers. An internal adjudication body, and an external Education Appellate Tribunal are necessary. The rules governing SSRA also must lay out procedural and substantive guidance on applying administrative actions.
The proposal of the Kasturirangan Report to establish an independent SSRA is a promising reform for K-12 education in India because it tackles the key impediments to improvement—conflicts of interest between service-delivery and regulation, absence of accountability, violation of natural justice, and unchecked discretionary power of officers. Embedding the above-mentioned design elements in an SSRA may not guarantee a world-class regulator, but their absence will certainly result in an ineffective regulator that compounds the problems in K-12 education.
What does a framework of regulatory quality and hygiene entail?
All articles of law create obligations and impose restraints on government action. Laws that govern economic activity, for example, limit business entry and exit, product price and quality, whereas social laws alter individual or organisational behaviour. The process through which rules are drafted and enacted, the authorisation to state action that rules provide and the constraints on private action that rules sanction have a bearing on enterprises and every day living.
This paper, the second in our series of papers on the state of regulatory quality in India, provides a simplified guidepost to improve regulatory hygiene in India. We outline benchmarks to guide rule-making and establish checks on government action.
Through an extensive literature review, we identified practices that must be encoded into the rulemaking process. These are categorised under three heads:
Democratic Safeguards are procedural checks that help ensure a participatory, transparent and accountable rulemaking process. Ex-ante, this involves increasing public access to the rule-set (including accessibility in terms of language), a serious consideration of stakeholder views and a rigorous assessment of the costs and benefits. Ex-post, this involves a review to assess the validity, cost-effectiveness and efficiency of the legislation.
Use of tools throughout the lifecycle of a regulation, from drafting to sunset, allows a rule-making body to manage the flow and stock of regulation. We find that countries like Sweden, United Kingdom and Australia use different mechanisms to ensure that the interests of the affected parties and the public at large are heard and honoured by decision-makers.
Legal Safeguards are checks on executive discretion. While executive discretion is inevitable, it ought not to be unguided and uncontrolled. There is a thin line between discretionary powers and the arbitrary exercise of powers. Rule of law demands that the executive ought to operate within a constraining framework that provides express legal authorisation to and procedural checks against excesses.
In particular, procedural checks ought to be placed on the rule-making (quasi-legislative) and decision-making (quasi-judicial) functions of the executive - both of which affect the rights and duties of the regulatees. In the United States, for instance, the Administrative Procedure Act provides standards to guide administrative action and encodes the duties of procedural propriety in law.
Economic Safeguards are substantive checks on the way a rule-set impacts economic freedom. Rules that regulate economic activity are guided by consideration for both market participants: enterprises and consumers. While India is influenced by different frameworks including World Bank’s Doing Business in carrying out economic reforms, it lacks a lucid and explicit regulatory philosophy of its own to guide economic laws.
Most high-income countries such as Hong Kong and the United States share certain features and values that guide their economic laws. This includes a high degree of openness (allowing for easy entry and exit for firms), low economic burden, increased competition, an enabling environment for the private sector and greater consumer choice.
Drawing from global best practices and indices around the world, we propose a check-list (for primary acts) to measure the quality of rules currently on the books in India. The check-list is a set of distilled minimums based on these three safeguards, that any rule-set ought to conform to. These do not apply to any one department, regulator or agency but to all.
A check-list approach to evaluate laws currently on the books will help diagnose the distance individual rule-sets have to cover, along with guiding future law-making. While there have been efforts in India to evaluate the impact of single rules, little attention has been paid to a comprehensive evaluation of all regulations, across industries over a period of time to assess the cumulative cost of regulation.
High-performing countries persistently strive to introduce such institutions and mechanisms to create a transparent, answerable and accountable government. To build a well-functioning and non-intrusive regulatory regime we in India need to similarly introduce a ‘set of institutions and processes that embed regulatory review mechanisms into the every-day routines of governmental policy-making’ (Morgan 1999: 50). In sum, what we need is a whole-of-government approach for regulation of regulation.
Suboptimal vendor enumeration practices in Gurugram, Haryana
The Street Vendors Act 2014 mandates the formation of town vending committees (TVC) to survey all local street vendors at least once every five years. Until a survey is complete, no street vendor is to be evicted. In this attached study, we document how street vendors were enumerated in Gurugram, Haryana.
Multiple surveys, varying methods
In the span of seven years, six private agencies have been contracted by different government departments at the municipal and state level. These agencies carried out surveys using varying methods and each reported different number and category of vendors (Figure 1). Despite multiple attempts, it is not clear if and how the agencies adhered to the Central Act and state guidelines. There also seems to be a lack of thorough and careful evaluation, by the local authority, of the work carried out by the private agencies.
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Figure 1: Timeline of surveys in Gurugram
Contracted agencies used different survey practices
To understand the enumeration mechanisms adopted by different agencies, we interviewed two agencies, Egmac Capital and REPL. The former was contracted under the local authority and surveyed sector 10A and 56, the latter was contracted by the state government and surveyed the whole of Gurugram.
While Egmac Capital carried out a survey using physical forms, REPL used an app called the REPL Survey. The application allowed the agency to geotag the individual vending spot of all vendors. Figure 2 lists the differences in practices followed by the two agencies.
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Figure 2: Comparative analysis of survey practices adopted by two agencies
Critical gaps in vendor enumeration practices in Gurugram
Surveys are not all-inclusive: Barely a third of the vendors we interviewed (11 out of 30) were surveyed under any of the survey exercises. Even in designated vending zones, vendors remain uncounted. None of these vendors could confidently declare who their surveyor was.
Local authority reigns supreme: The Act is clear on two aspects: first, the final decision on vending zones will be made by the local authority in consultation with the TVCs, and two, the scheme has to provide for the conditions and principles of demarcating vending and no-vending zones. Haryana fails on both aspects: the local authority decides and then declares its decision to the TVC, and there is no notified scheme.
Misaligned Incentives: The TVC meeting minutes, from 25 January 2017, highlight that one of the agencies underreported the number of vendors to evade paying the Municipal Corporation of Gurugram (MCG) its share in the fees collected from vendors. In another instance, the state government paid REPL on a per vendor basis. While the first instance creates incentives for the agency to underreport, a per-vendor payment system may create perverse incentives to overreport the number of vendors.
Survey complete without a scheme. What next?
There remain many implementation gaps. Haryana, for example, has not drafted the scheme, as required under the Street Vendors Act 2014. The state government and the MCG carried our surveys, through private agencies, in the absence of a scheme. Further, the scope and results of the agencies differed significantly making comparisons or creation of a unified dataset of vendors difficult.
The survey reports of all the agencies are stuck with the local authority and TVC. Complaints to the MCG by the vendors and the private agencies go unheard. Currently, the only avenue to express concerns, the TVC, has not conducted any meeting since 21 August 2018.
Gurugram’s model of contracting out vendor enumeration to private agencies may be desirable given constraints on state capacity. However, without clear objectives and rigorous evaluation of work, we are left with less than perfect outcomes.
How does India fare on Quality of Regulation?
Regulation takes different forms in India. There are ordinances and statutes by the parliament or state legislatures; rules, circulars, orders, and schemes by executive agencies; and orders by the courts. As is commonly known, rule-making in our country is disorganised with new rules added on the fly, without review of existing regulation. The public consultations are rarely transparent. Consideration for costs and benefits, compliance burden, or regulatory coherence is a rare phenomenon. Our latest paper titled ‘How does India fare on Regulatory Hygiene’ is the first in a series of papers that will capture the lack of quality of regulation in India and suggest reforms. In this paper, particularly, we lay out India’s performance on global best practices on rule-making hygiene. Below is a summary of the findings.
Why should India care about regulatory hygiene?
India scored 3.5 out of 5 on the World Bank’s Global Indicators of Regulatory Governance (GIRG). Not surprisingly, a country’s performance on GIRG is closely tied to the Bank’s Doing Business rankings. 43 out of the top 50 countries in the doing business rankings score substantially higher than India on GIRG. These countries mandate rigorous measurement of regulatory costs and benefits, conduct public consultations, and periodic fitness check of rules on the books.
We argue that our aspiration to enter the ranks of top 50 on World Bank’s Doing Business index will only come once we move up on the governance reforms and institutionalise hygiene in our rulemaking process.
How does India fare on Regulatory Hygiene?
We examine how India performs on 5 parameters of regulatory hygiene:
- Impact Assessment: Government of India and state governments do not measure the potential impact of regulations on entrepreneurs, enterprises or consumers. In the absence of ex-ante impact assessment, the government relies on anecdotes or lobbying, resulting in lopsided or reactive regulatory responses. Despite recommendations by multiple committees and a policy on pre-legislative impact assessment and consultation, government agencies do not conduct impact assessments.
- Public Consultations: In India, there is no law that binds the government to consult the public before the enactment of a law, publish comments, or report the results of the consultation. As a consequence, the practice of soliciting comments and reporting on the results of public consultation is largely superficial. Only select ministries report on the results of consultation.
- Language of drafting laws: India has, unfortunately, remained untouched by the plain English movement, initiated in several other parts of the world. The movement emphasises on simplifying language, decreasing complexity of laws, and consequently increasing their accessibility. Aside from a select few instances such as the ‘plain and simple’ technique of Indian Financial Code, most laws remain difficult to understand and out of reach for a majority of the population.
- Ex-post review: An ex-post review ensures that any rule-set, after enactment, remains fit for purpose, cost-effective, and efficient. The GIRG asks four questions on post-legislative reviews, and India’s response to all is ‘NO’. India has currently over 850 Acts at the central level alone, many of which are redundant or archaic. Over the last five years, the union government has repealed 1,428 central Acts. While these initiative to repeal is a positive development, it is necessary that we put in measures to ensure that every Act, by design, is reviewed at a scheduled interval for its intended and unintended consequences.
- Oversight on subordinate legislation: Most central and state acts subordinate rulemaking to the executive body, i.e., the state or central government. Through the use of judicial scrutiny, public consultations, and parliamentary reviews, the state ensures that delegated legislation does not exceed the scope of the parent Act. If this scrutiny on delegated powers is compromised, the doctrine of separation of powers between the executive, parliament and legislature that ensures that no one branch holds excessive power, is compromised.
While the Supreme Court of India has argued that the parliament maintains ‘strict vigilance and control’ over delegated legislation, research reveals that parliamentary control of delegated legislation is weak.
As evident from the lack of method in our rule-making apparatus, we are not prepared to cope with the demands of a fast-growing, largely informal and diverse enterprise environment. The political class and bureaucrats continue to favor minor tweaks as opposed to substantive reforms in the rulemaking process.
The convening of the Better Regulation Advisory Group by the Department of Industrial Policy & Promotion in February 2018 offered hope. The group was to report its findings within two weeks. However, one year and 10 months later, the findings of the committee are not published.
The ambitious goal of becoming a $5 trillion economy by 2025 can only be realised if the gaps in the rulemaking process are addressed. The approach of one good law at a time is no longer sufficient. The system should be redesigned such that every rule on the law book meets its objectives in the least harmful manner.
The paper will be published in the forthcoming issue of the Journal of Indian Law and Society.
Street Vendors Act 2014: Allocating Certificates of Vending
Street vending is typically self-regulated by informal but codified norms of space allocation. Vendors, in most cases, allocate/occupy spots based on the rule of first possession. Kettles (2006) argues self-regulation brings efficiency and reduces conflicts through the identification of “valuable” revenue-generating vending sites. For the administration, such self-regulation reduces the burden to identify and allocate vending spots. More importantly, formalising existing informal practices increases compliance, reducing the need for enforcement.
In this article, we deal with a question central to urban planning: How should the Indian government, in light of Street Vendors Act 2014, formalise and allocate of rights to public spaces?
Recap of Street Vendors Act 2014
The Street Vendors Act 2014 seeks to formalize the existing space allocation to a great extent instead of allocating de novo. It attempts to formalize all existing vendors and prohibits declaring existing natural markets into no-vending zones. The Act necessitates the formation of a local governance body, called the Town Vending Committee (TVC), responsible for the regulation of vendors. The Committee is mandated to survey all vendors and issue Certificates of Vending (CoV) to all identified vendors.
The central problem is ultimately determining a method to the madness around the use of public spaces such that interests of all parties, especially vendors, are met. Put another way, this requires some process to determine and assign user rights to vendors.
Formalising vendors will require formalising usufructuary vending rights
The Act approaches the question of assigning property rights, particularly user rights to a particular spot, to vendors in conflicting terms. On the one hand, Section 29(1) expressly declares that the Act confers no “temporary, permanent or perpetual right of carrying out vending activities in the vending zones allotted to him or in respect of any place on which he carries on such vending activity.”
On the other hand, section 5(1)(c), for example, mentions a condition of non-transferability for issuance of CoV. This condition prohibits the transfer of CoV, rent or even the place specified in the CoV to any other person. It implies, place of vending is ‘specific’ and it is to be specified in the CoV.
Three aspects of implementation require careful attention
First, while the Act protects existing vendors by requiring local governments to accommodate them until the upper limit of 2.5% of the local population is reached, it leaves the determination of holding capacity, applicable to new vendors, to the local authority. The principles the state government lays out in determining the formula for calculating holding capacity will determine how inclusive or accommodative the local government will be of new vendors.
Second, if the demand for CoV from existing vendors and new applicants exceeds the holding capacity, the Act suggests carrying out a draw of lots. While section 4(3) of the Act seems to equate existing and new vendors, we recommend prioritising existing vendors over new applicants. The manner in which state governments balance the demands of existing and new applicants, especially when it exceeds holding capacity and 2.5% of the population, have implications on vendor livelihoods and urban space management.
Third, the Act is ambiguous on whether or not to assign property rights to a specific spot to a vendor. There may be different ways to approach this: allocation of exclusive rights to a site to the vendor, allocation on the time-sharing basis (in a day, month, or season) or allocation of an area without specifying the vending site. Each of these policy choices has pros and cons, and has a bearing on the degree of vendor formalisation.