Economists, labour groups warn new bill weakens rural job security

By A Representative 

The NREGA Sangharsh Morcha (NSM) has strongly opposed the proposed Viksit Bharat – Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, 2025, warning that it seeks to dismantle the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and replace a legally enforceable right to work with a discretionary, budget-capped scheme controlled by the Union government. 

Addressing a press conference in New Delhi, NSM leaders, economists, workers and activists said the Bill had been introduced without consultation with workers or their organisations and would have far-reaching consequences for rural livelihoods across the country.

According to NSM, the proposed legislation repeals MGNREGA, 2005, and empowers the Centre to fix annual, state-wise “normative allocations” for employment generation. Any expenditure beyond these pre-determined limits would have to be borne by state governments. Speakers at the press conference argued that this effectively caps the number of days of employment available to rural households and undermines the demand-driven nature of the existing law. They pointed out that even under the current framework, the Centre has been unable to provide 50 days of work per household in many states, and claimed that the government’s projection of offering 125 days of employment under the new scheme was misleading.

Participants warned that the Bill shifts the financial burden of rural employment sharply onto states by introducing a 60:40 cost-sharing formula for wages, ending the Centre’s responsibility for full wage payments. They said poorer and cash-strapped states would be disproportionately affected, leading to reduced employment opportunities and increased distress migration. Concerns were also raised over provisions that allow the Centre to notify select rural areas for coverage, potentially excluding large sections of rural workers, and over a proposed 60-day blackout period during peak agricultural seasons, which speakers said would weaken the bargaining power of women, landless labourers and marginalised communities.

Economist Prabhat Patnaik highlighted the importance of guaranteed employment in times of rural distress, while several speakers emphasised that MGNREGA had played a crucial role in stabilising rural wages and providing income security. Kamla Devi, a widow from Beawar in Rajasthan who has worked under NREGA for 18 years, told the gathering that the programme had been her only source of livelihood after her husband’s death and questioned how workers like her would survive without it. Annie Raja of the National Federation of Indian Women recalled the long social struggles that led to the enactment of NREGA and said the law had transformed women’s lives by ensuring equal wages and a measure of economic independence.

Economist Jayati Ghosh warned that the Bill posed serious risks to India’s federal structure by granting sweeping discretionary powers to the Centre, particularly in deciding where the scheme would apply and in capping budgets. She said this could allow the Union government to use funds as a political tool against opposition-ruled states and would hurt regions where rural employment support is most urgently needed. Jean Drèze described NREGA as one of the few laws that gave India global moral standing, and cited fund cuts, work stoppages and exclusionary technological measures as evidence of the current regime’s approach to the programme. 

Trade union representatives and activists argued that the Bill would centralise planning through alignment with national infrastructure initiatives, undermining the role of Gram Sabhas and the constitutional framework of decentralised governance. They also criticised increased reliance on biometric authentication and digital monitoring, saying such measures had already led to large-scale exclusions under existing systems. B. Venkat of the All India Agricultural Workers Union rejected claims that MGNREGA harms agriculture, stating that small farmers and artisans benefit from the programme and that the proposed changes could recreate exploitative labour relations in rural areas.

NSM representatives said worker delegations had begun engaging Members of Parliament across party lines to oppose what they described as an attempt to bypass parliamentary scrutiny and push the Bill through. Meetings have been held with MPs from several opposition parties as well as with representatives of some National Democratic Alliance allies. The organisation reiterated that the proposed law represented a rollback of constitutional guarantees won through decades of struggle and demanded its immediate withdrawal.

Announcing a nationwide day of action on December 19, NSM said rural and agricultural workers would hold protests at national, state, district and local levels to press for the withdrawal of the VB–G RAM G Bill. The Morcha asserted that any effort to repeal or fundamentally alter MGNREGA without the consent and participation of workers and their organisations would be resisted, and pledged to continue mobilisations until the existing employment guarantee law is strengthened rather than dismantled.