In year NDA passed law to replace MGNREGA, 8% dip in families that availed the rural job scheme
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Context
The Indian Parliament has enacted the Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (GRAMIN) Act, 2025, to replace the two-decade-old (MGNREGA). This new legislation introduces significant structural changes to the country's flagship rural employment program. Meanwhile, official data indicates a decline in the number of households that availed of in the 2025-26 fiscal year, though demand remains higher than pre-pandemic levels.
UPSC Perspectives
Polity & Governance
The transition from to the marks a fundamental shift in the governance of rural employment, moving from a rights-based, demand-driven framework to a supply-driven, budget-capped scheme. was built on the principle of a legal right to work, where any rural household could demand 100 days of employment, and the government was legally obligated to provide it or pay an unemployment allowance. The new Act, while increasing the guaranteed days to 125, introduces a "normative allocation" system, where the central government pre-determines the budget for each state. This change dilutes the rights-based nature of the guarantee, as employment becomes contingent on fund availability. For the UPSC exam, this raises questions about the evolution of social safety nets and the potential dilution of legal entitlements into schematic benefits. Aspirants should analyze whether this shift strengthens or weakens the state's accountability to its citizens.
Economic
The new legislation fundamentally alters the fiscal architecture of the rural employment guarantee. Under , the Centre bore 100% of the cost for unskilled wages and 75% for materials, making it a powerful tool for automatic fiscal stabilization in rural areas. The , however, implements a cost-sharing model, with a 60:40 Centre-State split for most states and 90:10 for North-Eastern and Himalayan states. This imposes a significant new fiscal burden on state governments, particularly those with high poverty rates and low revenue capacity, which may struggle to allocate their 40% share. The Act also introduces a provision for a 60-day 'pause' during peak agricultural seasons to prevent labour shortages for farming. UPSC aspirants should connect this to concepts of fiscal federalism and its impact on states' finances, as well as the economic trade-offs between providing a social safety net and ensuring labour supply for private agriculture.
Social
has served as a critical social safety net, especially for vulnerable groups, and saw a massive surge in demand during the COVID-19 pandemic as migrant workers returned to their villages. The scheme has been credited with enhancing livelihood security, reducing distress migration, and empowering women, who are guaranteed at least one-third of the jobs. While the number of families availing the scheme has gradually decreased since the pandemic peak, it remains a vital source of income. The aims to create more 'durable assets' by aligning projects with national priorities like the National Master Plan. Students should analyze the social implications of this shift from a purely demand-driven safety net to a model focused on planned infrastructure creation. Key questions for analysis include: will the new focus on pre-planned, asset-creating works retain the accessibility and inclusivity that made a lifeline for the most marginalized?