The President of India has assented to the Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025, enhancing the statutory wage employment guarantee to 125 days and strengthening rural livelihoods through empowerment, convergence, and saturation-based delivery for a resilient, self-reliant rural Bharat.
A misreading by some
Yet, even as the VB-G RAM G Act comes into force, there are some who have advanced a set of assumptions that do not withstand careful scrutiny. It is being claimed that the employment guarantee has been weakened, that decentralisation and demand-based rights have been undermined without consultation, and that the reform represents fiscal withdrawal that is disguised as restructuring. Each of these assertions rests on a misreading of the Act’s substance and intent.
What has led to this misreading is a deeper conceptual error the assumption that welfare and development are opposing choices. The new framework is built on the opposite understanding: that welfare, anchored in an enhanced statutory livelihood guarantee, and development, anchored in durable infrastructure creation and productivity enhancement, are mutually reinforcing. Income support, asset creation, agricultural stability and long-term rural productivity are treated as a continuum rather than a trade-off. This is not aspirational rhetoric but an approach embedded in statutory design.
The suggestion that the legal right to employment has been diluted is incorrect. The Act retains the statutory and justiciable character of the employment guarantee while strengthening its enforceability. Far from being curtailed, the entitlement has been expanded from 100 to 125 days. Procedural dis-entitlement clauses that previously nullified unemployment allowance in practice have been removed, and time-bound grievance redress mechanisms have been reinforced. The reform directly addresses the long-recognised gap between statutory promise and lived reality.
It is also argued that demand-based employment has been abandoned in favour of top-down planning. This rests on a false binary. Demand for work continues to originate from workers. What changes is that demand is no longer addressed only after distress has set in. By anchoring execution in advance, participatory village-level planning, the reform ensures that when workers seek employment, work is actually available rather than denied due to administrative unpreparedness. Planning, in this sense, does not suppress demand; it operationalises it.
The charge of centralisation overlooks the architecture of the law. Gram panchayats remain the primary planning and implementing authorities, and gram sabhas retain approval powers over local plans. What has changed is that decentralised planning is no longer ad hoc or episodic but institutionalised as a structured and participatory process. Viksit Gram Panchayat Plans are aggregated at the block, district, State and national levels to enable coordination, convergence and visibility across sectors, not to override local priorities. What is centralised is coherence; the decision-making authority remains local. This corrects fragmentation without undermining decentralisation.
Claims that the reform was pushed through without consultation are equally inconsistent with the record. The Bill was preceded by extensive consultations with State governments, technical workshops and multi-stakeholder discussions. Core design features – village planning structures, convergence mechanisms and digital governance systems were shaped by feedback from States and by lessons drawn from years of implementation.
An increase in allocations, equity
The broader premise that the employment guarantee was systematically weakened over the past decade does not align with facts. Budgetary allocations increased from ₹33,000 crore in 2013-14 to 286,000 crore in 2024-25. Person days generated rose from 1,660 crore in the period up to 2013-14 to 3,210 crore thereafter. Central funds released increased from ₹2.13 lakh crore to ₹8.53 lakh crore, and completed works expanded from 153 lakh to 862 lakh. Women’s participation rose from 48% to 56.73%. Over 99% of fund transfer orders are now generated on time, and nearly 99% of active workers are linked to the Aadhaar Payment Bridge. These trends point to sustained commitment and improved delivery, not neglect.
What became evident over time, however, was that implementation experience had also revealed structural weaknesses in the earlier framework itself-episodic employment, weak enforceability of unemployment allowance, fragmented asset creation and persistent scope for duplication and ghost entries. These weaknesses were visible on the ground during drought years, migration spikes and periods of disruption such as the COVID-19 pandemic.
Fiscal restructuring under the new Act is also mischaracterised as abdication. The central government’s contribution is increasing – the provision for the Centre’s share rises from ₹86,000 crore to nearly 295,000 crore, underscoring continued and enhanced support for rural employment. The 60:40 funding model follows the long-established structure of centrally sponsored schemes, while the northeastern and Himalayan States and Jammu and Kashmir are accorded a differential 90:10 ratio. Far from signalling fiscal withdrawal, this framework reinforces shared responsibility and accountability.
Equity is ensured through rule-based normative allocation, with State-wise allocations determined on objective parameters prescribed in the Rules. States are treated not as mere implementing agencies but as partners in development, empowered to notify and operationalise their own schemes within the statutory framework. Flexibility is explicitly preserved: during natural disasters, or other extraordinary situations, States may recommend special relaxations, which includes expansion of permissible works and temporary enhancement of employment. Rule-based allocation and contextual flexibility are thus balanced in a manner consistent with cooperative federalism.
The Act empowers States to notify, in advance, periods aggregating to 60 days in a financial year covering peak sowing and harvesting seasons during which works shall not be undertaken. Differentiated notifications may be issued at the level of districts, blocks, or gram panchayats based on agro-climatic conditions, ensuring that the enhanced employment guarantee complements agricultural operations.
The UPA’s record
From its very first tenure, the Congress-led United Progressive Alliance (UPA) government failed to match rhetoric with delivery under MGNREGA. While the Congress manifesto promised “at least 100 days of work at a real wage of 100 per day”, the government capped wages at 100 as early as 2009 and kept them frozen for years, ignoring inflation and rising rural distress. The Centre openly admitted that States were acting arbitrarily under the scheme and justified the wage freeze by blaming State governments for ‘indiscriminate increases’. This admission itself exposed a serious governance failure: the Congress-led Centre was unable to control even its own State governments, allowing MGNREGA to become vulnerable to misuse, fake job cards, and financial leakages.
The UPA’s second term saw a steady decline in commitment to the scheme. Budgetary allocations were cut from 240,100 crore in 2010-11 to 33,000 crore by 2012-13, despite growing demand from States. In a parliamentary reply in 2013, Minister of State Rajeev Shukla acknowledged that employment under MGNREGA had fallen sharply from 7.55 crore workers in 2010-11 to just 6.93 crore by November 2013. Delayed fund releases, lack of transparency in payments, and administrative apathy discouraged workers from seeking employment, directly undermining the legal guarantee promised under the Act.
The Comptroller and Auditor General’s 2013 report laid bare the true state of MGNREGA during the UPA years. It highlighted widespread corruption and mismanagement: over 4.33 lakh fake or defective job cards, thousands of crores lost to unaccounted withdrawals and irregular work, delayed or denied wages in 23 States, and poor record-keeping in more than half of India’s gram panchayats. States with the highest concentration of rural poor- Bihar, Uttar Pradesh and Maharashtra used only about 20% of allocated funds, proving that the scheme failed precisely where it was needed most.
To frame the debate as a choice between welfare and development is to pose a false dichotomy. Welfare, when anchored in a guaranteed livelihood, and development, when anchored in durable rural infrastructure and productivity, are not competing objectives but interdependent ones. The real decision was whether to freeze a framework that often under-delivered, or to reform it into a modern, enforceable, and integrated employment guarantee that advances welfare through development. The new Act preserves the legal right to work, expands entitlements, strengthens worker protections, and corrects structural weaknesses revealed through years of implementation. This is not demolition, but a process of renewal grounded in experience.
Courtesy PIB, Srinagar
The author is Union Minister for Agriculture and Farmers’ Welfare, and Rural Development, Government of India.
