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‘A Bill to Destroy MGNREGA’: Why Experts Fear the New Rural Job Guarantee Law

The new VB–G RAM G law raises the stated rural work guarantee to 125 days, but critics fear central allocations, a seasonal pause and higher state costs could weaken MGNREGA’s demand-based right.
From TheFinanceBase Team6 min to read
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The Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (Gramin), or VB–G RAM G, is the replacement for MGNREGA. Scroll reported that it received presidential assent and was scheduled to take effect on July 1, 2026, the date MGNREGA was to be repealed. The title phrase “a bill to destroy MGNREGA” reflects critics’ assessment of the proposal; it is not a neutral description of the law or proof of its effects. The central concern is that a higher stated guarantee—125 days of work per rural household—may be harder to claim if access depends more on Union-set allocations, designated areas and administrative systems. The available reporting does not establish whether later litigation or administrative changes altered the announced start or how implementation has worked since.

What changed from MGNREGA to VB–G RAM G?

MGNREGA was described in Scroll’s December 2025 report as a demand-based legal guarantee: a rural household could demand up to 100 days of work, with an unemployment allowance due if work was not provided. Under the replacement, the stated guarantee rises to 125 days. Critics argue that the number of days alone does not settle whether a household can obtain work when it asks for it.

The difference is in how access is shaped. Scroll’s reporting describes MGNREGA as driven by workers’ demand, while the new scheme gives the Union government a stronger role in setting state-wise normative allocations and selecting areas where work will be available. Economist Jean Drèze summarized his concern about the proposed law this way: “It provides a work guarantee without any guarantee that the guarantee applies.”

Issue MGNREGA, as described in reporting VB–G RAM G, as described in reporting
Work guarantee 100 days per rural household that demands work 125 days per rural household
Allocation Demand-based access to work Union government sets state-wise normative allocations and selects areas for work
Local role Panchayats had a stronger role in allocating work, according to Scroll Village plans require central approval, according to Scroll’s account of the proposal
Seasonal availability Scroll’s article describes no comparable blanket 60-day pause A 60-day pause during agricultural seasons was proposed; whether it remained in the final text is not established by the reporting cited here

The comparison reflects Scroll’s reporting, not a clause-by-clause review of the enacted Act. In particular, the reporting does not establish the final legal wording for every provision.

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Why do experts call the bill a threat to the demand-based guarantee?

Central allocations could limit when demand produces work

Under a demand-based guarantee, the worker’s request is meant to trigger an obligation. Critics fear that if a state’s allocation is capped or the Centre decides which locations qualify for work, demand may no longer be sufficient to secure a job. LibTech India researcher Chakradhar Buddha put the concern plainly: “But if the new bill is passed, people will not get jobs if they demand it. They will get jobs if the central government has the budget and thinks it fit to give work in their village.”

Rural activist Nikhil Dey, founder of Mazdoor Kisan Shakti Sangathan, said the shift would end the demand-based allocation: “Through this section, the government ends that demand. Now the central government will decide the allocation.” These are critics’ interpretations of the proposal, not measured findings about outcomes under the law.

Less local discretion may affect which works are chosen

Scroll reported that the proposal required village plans to receive central approval. Critics see this as a reduction in Panchayats’ discretion over work allocation. The practical question is whether central planning and approval will be responsive to local needs—such as the timing and type of work residents seek—or make access more dependent on decisions made beyond the village.

How could the changes affect workers’ income and bargaining power?

A seasonal pause could narrow the period to claim work

The proposal described by Scroll included a 60-day pause in guaranteed work during agricultural seasons. Supporters may view a seasonal break as a way to align public works with farm labour demand. Critics fear that if the pause coincides with a period when a household needs guaranteed work, the legal option to seek it would be unavailable. They also argue that removing the public-work alternative could weaken workers’ bargaining position with agricultural employers.

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Activists and researchers warned that reduced access could contribute to distress migration or renew dependence on landlords. Those are forecasts about possible effects, not established results. Scroll also included an individual worker’s account from Raichur involving delayed work and income; it illustrates a personal experience, not a representative measure of conditions across India.

What does the funding change mean for state budgets?

Cost sharing is another source of concern, especially for states with less room in their budgets. Scroll’s December 2025 report said the Centre had paid all wage costs and 75% of material costs under the existing arrangement, and described a proposed 60% Union and 40% state sharing pattern for most states. A later Scroll report summarized the replacement as leaving states with a 40% share overall in material and administrative expenses while the Union continued to bear the wage component.

These descriptions refer to different cost categories and should not be collapsed into a single detailed fiscal formula without checking the Act and rules. The later report said the Union budget allocation for the scheme in FY2026–27 was more than Rs 95,600 crore. That is a reported budget allocation, not evidence of how much each state received or spent.

Opposition-ruled Karnataka, Kerala, Punjab, Telangana and Jharkhand passed resolutions opposing the Act and seeking restoration of MGNREGA, according to Scroll’s 2026 reporting. Kerala’s resolution cited a severe financial burden on the state and argued that the rights-based approach had disappeared; Punjab’s cited effects on poor households, Scheduled Caste communities and rural labourers. These are the states’ stated positions, rather than independent assessments of the law’s fiscal or social effects. Union Rural Development Minister Shivraj Singh Chouhan defended the Act, saying it would mark “the dawn of a new era in the lives of labourers,” and pointed to rural infrastructure and water-conservation works as intended benefits.

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What are the concerns about digital systems and worker access?

Scroll’s December 2025 report described existing concerns around attendance systems, Aadhaar-linked payments and e-KYC, and said the new scheme proposed AI, attendance tracking and dashboards. The concern is not simply that technology will be used; it is that digital checks or administrative decisions could make it harder for eligible workers to register, record attendance or receive payment if systems fail or records are inaccurate.

LibTech India researcher Chakradhar Buddha told Scroll that at least 27 lakh workers were deleted between October 10 and November 14 following mandatory online e-KYC, and said: “Technology has been stripping away the right to earn”. The figure and causal framing are the researcher’s, as reported by Scroll; they are not an independently verified national estimate in the reporting cited here. The article does not establish that technology alone caused every deletion or access problem.

Has the new law replaced MGNREGA?

Scroll reported that the bill received presidential assent and that the government set July 1, 2026 as the new Act’s commencement date and MGNREGA’s repeal date. Because that date has passed, the original December 2025 framing of a proposed bill is no longer the latest status in the reporting. However, the available reports do not establish whether later court action or administrative changes affected commencement, nor do they provide a verified picture of implementation after the scheduled date.

For that reason, the argument that the law will “destroy” MGNREGA should be understood as a warning from critics about the design and possible consequences—not as a demonstrated account of what has happened nationwide. The government’s stated case emphasizes a 125-day guarantee and intended rural infrastructure and water-conservation work; critics focus on whether the guarantee remains actionable when allocations, location choices and seasonal availability are more centrally bounded.

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