Why the New VB-G RAM G Act Marks a Turning Point and a Retreat in India’s Right to Work Framework

The Viksit Bharat – Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025, which has now received the President’s assent, formally replaces the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). While presented as a reform aligned with fiscal prudence and efficiency, the new law represents a decisive shift away from the rights-based architecture that made MGNREGA globally distinctive. At stake is not merely an employment programme, but the constitutional understanding of livelihood, decentralisation, and State accountability.

MGNREGA and the constitutional idea of livelihood

Article 21 of the Constitution guarantees the right to life, which the Supreme Court has long interpreted to include the right to livelihood. In the landmark Olga Tellis judgment of 1985, the Court held that excluding livelihood from the right to life would render the guarantee meaningless. MGNREGA, enacted unanimously by Parliament after sustained social mobilisation, operationalised this constitutional vision by recognising the right to work as justiciable.

Unlike earlier public works programmes, MGNREGA created enforceable entitlements: work on demand, unemployment allowance if work was not provided within 15 days, time-bound wage payments with compensation for delays, minimum wages, and gender parity. In doing so, it converted welfare into citizenship rights.

What made MGNREGA different from past schemes

MGNREGA’s design rested on five pillars that distinguished it from targeted or discretionary schemes:

• Universality rather than beneficiary targeting
• Supplementing rural incomes and reducing poverty
• Addressing caste and gender inequalities through equal wages
• Creation of durable ecological and community assets
• Strengthening grassroots democracy via panchayat raj institutions

Empirical evidence reinforced its impact. Rural incomes rose, school enrolment improved, dependence on moneylenders declined, and women’s workforce participation expanded significantly — with women accounting for nearly 58% of workdays in recent years. About 45% of women workers had not been in the labour force before the Act. Even the World Bank, initially sceptical, later described MGNREGA as a “stellar example” of rural development. Its role as a safety net during the COVID-19 crisis further underlined its importance.

The slow erosion before formal replacement

The dismantling of MGNREGA did not begin with the 2025 Act. Chronic underfunding over the past decade led to delayed wage payments, rationing of work, and growing arrears — a reality acknowledged by the Ministry of Finance. Technocratic interventions such as photo-based attendance systems and complex digital payment mechanisms increased exclusions, widened the distance between workers and administrators, and, paradoxically, created new avenues for corruption.

Institutional safeguards like social audits, designed to check malfeasance, were systematically underfunded. Staff shortages at the local level further weakened implementation. The new Act was passed against this backdrop, without addressing these structural infirmities.

From demand-driven rights to command-driven allocations

The most consequential change introduced by the VB-G RAM G Act lies in its architecture. Under MGNREGA, employment was demand-driven: if workers demanded work, the State was legally obliged to provide it or pay compensation. The new law reverses this logic.

Key provisions vest sweeping discretionary powers in the Union government to decide where, how, and to what extent public works will be undertaken. “State-wise normative allocations” determined by the Centre replace open-ended demand. Expenditure beyond these limits must be borne by States themselves, effectively discouraging them from responding to excess demand.

This shift compromises local autonomy and weakens the role of panchayats, which MGNREGA had positioned as central actors in planning and implementation.

Fiscal restructuring and the risk of political asymmetry

The financial burden-sharing has also been altered. While MGNREGA was funded roughly in a 90:10 ratio between the Union and States, the new Act moves towards a 60:40 model for most States. Crucially, the Centre is no longer explicitly accountable for delays in wage payments — despite a 2018 Supreme Court ruling directing compensation for such delays.

Together, these changes raise concerns of political favouritism, where compliant States may be rewarded and others fiscally constrained. States, under pressure to remain within allocations, may suppress work demand, triggering distress migration and rural unemployment.

Seasonal exclusions and deepening inequalities

One of the most controversial provisions bars employment for 60 days during the agricultural season. For landless workers and women, who rely on year-round access to employment, this undermines the very security the programme was meant to provide. Rather than complementing agriculture, the law risks hardening land, caste, and gender hierarchies.

Despite evidence that farmers benefit from MGNREGA through asset creation and income support, the new framework implicitly pits agricultural interests against labourers, fragmenting rural solidarities.

The promise of 125 days and the reality of implementation

The Act’s promise of 125 days of employment per household appears aspirational rather than credible. When average work availability under MGNREGA hovered around 50 days due to funding constraints, the absence of guaranteed financing makes the expanded entitlement largely symbolic.

Equally telling is what the Act omits: no new mechanisms to address corruption, transparency, or accountability have been introduced, despite these being cited as justification for reform.

What is lost in the transition

MGNREGA was a rare synthesis of Mahatma Gandhi’s vision of decentralised self-governance and B. R. Ambedkar’s insistence on enforceable rights. By converting a rights-based guarantee into a centrally managed allocation scheme, the VB-G RAM G Act marks a philosophical departure from both.

The new law does more than replace an employment programme; it signals a retreat from the idea that livelihood is a constitutional entitlement enforceable against the State. In doing so, it transforms the right to work from a matter of justice into one of administrative discretion — a shift with far-reaching implications for India’s rural poor.