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States may shoulder 40% of rural job plan funding

Business Standard

|

December 16, 2025

Slowing MGNREGA demand

- SANJEEB MUKHERJEE

The Union government has decided to replace the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), the flagship social-welfare scheme, 20 years after it was enacted, providing for a piece of legislation with a higher number of mandatory work days and altered funding norms.

The number of mandatory work days has been proposed to be increased from 100 to 125 and the ratio of funding between the Centre and states will change to 60:40 under the new law as against the existing maximum of 90:10.

The new law will be called the Viksit Bharat-Guarantee for Rozgar and Aajeevika Mission (GRAMIN), or VB-GRAMG.

According to critics, the changes, circulated in the form of a draft Bill, empowers the central government to decide in which parts of the country it wants the scheme to run and allows the states to stop the scheme for two months of their choice during the peak harvest season.

“The MGNREGA establishes a statutory right to work that is demand-driven and universal, ie any person willing to do unskilled manual work in any rural area must be provided work,” said the NREGA Sangharsh Morcha, an umbrella of people’s movements.

“But under the VB-G RAM GBill, Section 5(1) states the State Government shall, in such rural areas in the State as notified by the Central Government, provide to every household whose adult members volunteer to do unskilled manual work, not less than 125 days of guaranteed employment. Therefore, if a rural area is not notified by the Centre, there is no right to work for the people of that area, effectively reducing universally guaranteed employment to any other scheme run at the mercy of the Union Government,” the NREGA Sangharsh Morcha added.

The draft Bill said the state governments would notify in advance a total of 60 days (may not be continuous) in a financial year, covering the peak agricultural seasons of sowing and harvesting, during which works under this new Act would not be undertaken.

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