Context

• The replacement of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) with the Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025 marks a decisive transformation in India’s welfare regime.
• Enacted in 2005, MGNREGA established a demand-driven, legally enforceable guarantee of employment for rural citizens.
• The new law overturns this framework, replacing entitlement with discretion and decentralised implementation with centralised authority.
• This transition represents a fundamental ideological redefinition of welfare, altering the relationship between the state and its most vulnerable citizens.

Background: The Origins and Significance of MGNREGA

• MGNREGA emerged from the contradictions of post-liberalisation India, where economic growth failed to generate adequate employment or livelihood security.
• Persistent agrarian distress, jobless growth, and widening inequalities exposed the limits of market-led development.
• In response, the United Progressive Alliance introduced a rights-based legislative framework that included the Right to Information Act and the Forest Rights Act.
• MGNREGA stood at the centre of this framework. It recognised Employment as a legally enforceable right, affirming that political equality requires material security.
• Rather than rejecting liberalisation, the programme sought to mitigate its social costs by embedding enforceable entitlements within governance.
• Employment was treated as the most dignified and effective form of social protection in an economy dominated by informal labour.

Structural Changes under the VB-G RAM G Act

• The VB-G RAM G Act reverses the defining principle of guaranteed employment.
• By shifting from a demand-driven to a supply-driven model, it grants the Centre decisive authority over allocations, scope, and implementation.
• Work becomes contingent on administrative approval rather than citizen demand, reinforcing the centralisation of power and discretion.
• The revised funding structure deepens this shift. The Centre–State cost-sharing ratio has changed from 90:10 to 60:40, transferring substantial financial responsibility to States without corresponding fiscal support.
• Many poorer States may struggle to meet these obligations, compelling them to curtail project approvals and suppress employment generation.
• This combination of fiscal decentralisation and administrative centralisation undermines both federal balance and programme viability.

Ideological and Political Dimensions

• The repeal of MGNREGA represents a deliberate ideological break.
• The removal of Mahatma Gandhi’s name severs the programme from a moral legacy grounded in justice, dignity, and the upliftment of the poorest.
• This symbolic shift aligns with a broader political economy that prioritises market imperatives and corporate interests.
• Rights-based welfare schemes empower workers, decentralise authority, and institutionalise claims on the state.
• Such features conflict with governance models that favour executive discretion and market dominance.
• Discretionary welfare reframes social protection as benevolence, depoliticising structural inequality and transforming welfare into an instrument of political loyalty rather than social justice.

Democratic and Legislative Implications

• The legislative trajectory of the VB-G RAM G Act contrasts sharply with that of MGNREGA.
• While MGNREGA was enacted with unanimous parliamentary support, the 2025 Act was rushed through Parliament amid Opposition walkouts and without scrutiny by a Parliamentary Standing Committee.
• The absence of consultation with affected communities further underscores the erosion of democratic accountability.
• Restrictions on public protest and the procedural hurdles imposed on dissent highlight a shrinking civic space.
• Long-standing rights can be dismantled swiftly, while opposition is delayed through bureaucratic regulation, weakening participatory democracy.

Broader Consequences for Social Justice and Federalism

• MGNREGA demonstrated that large-scale welfare programmes could enhance productivity, raise rural wages, and strengthen democratic participation.
• Its nationwide reach and rights-based design converted welfare into enforceable citizenship claims.
• Its repeal, particularly after its critical role during the COVID-19 pandemic, constitutes a rollback of legal, fiscal, and institutional safeguards.
• By making livelihoods contingent on fiscal discretion, the new framework weakens constitutional commitments to dignity through work as a right and redefines welfare as conditional assistance rather than obligation.

Conclusion

• The dismantling of MGNREGA marks the end of India’s most ambitious experiment with rights-based welfare.
• The repeal signifies a retreat from enforceable entitlements and a reorientation toward discretionary governance.
• Beyond the fate of a single programme, it raises fundamental questions about social justice, federalism, and the future of democratic accountability in India.