Delhi: For nearly two decades, the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) has been more than just another welfare programme. It has served as India’s only legal guarantee of work, offering rural families a lifeline during droughts, crop failures, economic downturns and, most dramatically, the COVID-19 lockdown.
Now, the Congress claims that this rights-based safety net has entered a new phase—one that shifts the balance of power from workers to the government.
Launching a sharp attack on the Narendra Modi government, the Opposition party alleged that the Centre’s newly notified VB GRAMG framework fundamentally changes the nature of rural employment by replacing a demand-driven legal guarantee with an allocation-based programme controlled through centrally approved budgets.
Addressing a press conference in New Delhi, Congress leader and Chairman of the Parliamentary Standing Committee on Rural Development and Panchayati Raj, Saptagiri Ulaka, described July 1 as “the saddest day” for India’s rural poor.
“Today is the saddest day for the country,” Ulaka said, claiming that from July 1 the government had effectively dismantled the original framework of MGNREGA by replacing a legally enforceable entitlement with an administrative scheme.
From a Legal Right to a Budgeted Scheme?
The Congress argues that the biggest shift lies not in the name of the programme but in its philosophy.
Under MGNREGA, any registered rural household can demand work, and the administration is legally obligated to provide employment within a stipulated period or pay unemployment allowance. Funding follows demand, meaning the Centre is expected to release funds based on verified employment requirements.
According to Ulaka, the VB GRAMG framework abandons this principle. Instead of employment being guaranteed by law, work would now depend on labour budgets approved in advance, state-wise financial ceilings and central allocations.
In effect, the Congress argues, rural workers would no longer have an enforceable right to employment if a state’s allocation is exhausted.
The Union government has not responded to these allegations.
Congress Warns States Could Bear a Much Larger Financial Burden
Beyond the question of legal entitlement, the Congress believes the new funding architecture could significantly strain state finances.
Ulaka said that under MGNREGA, the Union government bears almost the full wage bill, while material costs are shared between the Centre and states. Under the proposed VB GRAMG model, however, both labour and material expenditure would reportedly follow a broader 60:40 cost-sharing arrangement.
The party fears this could leave states with difficult choices—either allocate substantially more money from their own budgets or restrict employment opportunities despite growing demand.
Referring to internal calculations, Ulaka claimed that states such as Haryana and Maharashtra could eventually shoulder close to 90 per cent of programme costs if they choose to provide the promised 125 days of employment beyond the Centre’s approved allocation.
The Congress also questioned whether the Centre’s present budgetary allocation is sufficient to support its promise of extending employment from 100 to 125 days in several states.
Fixed Formula vs Ground Reality
Another major criticism concerns the proposed formula for distributing funds.
According to the Congress, indicators such as population, geographical area, forest cover, demographic performance and Gross State Domestic Product may work for tax devolution, but they fail to capture the real drivers of rural unemployment.
Employment demand, Ulaka argued, fluctuates with monsoon failures, crop losses, migration, indebtedness, landlessness and local economic distress. A fixed allocation system, he warned, may fail precisely when rural families need public employment the most.
The party also objected to a reported provision allowing public employment to be suspended during peak agricultural seasons.
Agricultural calendars vary widely across India, Ulaka said, arguing that a uniform suspension could reduce workers’ bargaining power by forcing them to accept lower wages offered by private employers when public work is unavailable.
Local Self-Governance Also Under Question
The Congress further alleged that the new framework could weaken decentralised planning—one of MGNREGA’s defining features.
Village development plans, Ulaka claimed, would increasingly have to conform to centrally prescribed work categories, digital planning platforms and approved financial allocations, reducing Gram Sabhas and Gram Panchayats to implementing agencies rather than institutions empowered to determine local priorities.
The party also reiterated its demand for increasing MGNREGA wages to at least ₹500 per day, linked to rural inflation and aligned with statutory minimum wages.
A New Political Battle Over Rural India
The controversy over VB GRAMG comes at a time when rural distress, unemployment and farm incomes continue to dominate political discourse across several states.
While the Centre has presented the new framework as an effort to improve implementation and expand employment opportunities, the Congress argues that the changes fundamentally dilute the legal guarantee that made MGNREGA unique among India’s welfare programmes.
Calling for the restoration of MGNREGA in its original form, the party demanded that the Centre withdraw the new funding mechanism, protect workers’ job cards from arbitrary deletion and remove administrative barriers that restrict access to employment.
The Union government is yet to issue a detailed response to the allegations levelled by the Congress over the implementation of the VB GRAMG framework. As the debate unfolds, the future of India’s largest rural employment programme is once again at the centre of the country’s political contest.
