NEW DELHI: The Centre on Monday announced that the Viksit Bharat -Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-G RAMG) Act will come into force across the country from July 1, replacing the two-decade-old UPA-era Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), 2005.
However, Chairperson of the Parliamentary Standing Committee on Rural Development and Panchayati Raj, Saptagiri Ulaka, criticised the rollout as “not thought through” and called for a phased transition process and wider consultation with states before implementing the new framework nationwide.
According to a notification issued by the Ministry of Rural Development, the new Act will come into force in all states and Union Territories from July 1. In a separate notification, the ministry said that MGNREGA, enacted in 2005, would be repealed and replaced by the VB-G RAMG framework.
Speaking to TNIE, Ulaka said the Centre had failed to adequately plan the transition from MGNREGA to the new system.
“Once the Act was passed in December, they should have notified it immediately. There should have been a six-month overlap between the two schemes, as committed by the government earlier,” said the Congress MP.
Earlier, ministry officials had informed the Parliamentary panel that states would be given a six-month transition period to adapt to the new framework after the Act’s commencement date is notified.
The government stated in the notification that the transition would be seamless and without disruption to workers. It stated that all ongoing works under MGNREGA as of June 30 would continue under the new framework.
It also said existing e-KYC-verified MGNREGA job cards would remain valid until new “Gramin Rozgar Guarantee Cards” are issued. Workers would not be denied employment due to pending e-KYC verification, while registration of workers without job cards would continue at the gram panchayat level.
The new legislation proposes increasing the guaranteed wage employment period from 100 days to 125 days in a financial year.
However, Ulaka said MGNREGA could not be discontinued abruptly.
“You can’t switch off one system and switch on another. There has to be an overlap before moving from one system to the other,” he said, adding that the scheme was being shifted from a demand-driven to a supply-driven one.
While the Union Budget allocated Rs 95,692.31 crore for VB-G RAMG, only Rs 30,000 crore was earmarked for MGNREGA for the current financial year.
Pointing to a severe funding shortfall under MGNREGA, Ulaka said that nearly Rs 27,000 crore of the Rs 30,000 crore allocation would go towards clearing pending liabilities.
“There is not enough money for NREGA till June 30. People who demand work are not getting it. They have effectively killed the MGNREGA,” he said.
Another highlight of the new Act is the introduction of a 60:40 cost-sharing ratio between the Centre and states, marking a significant departure from the existing MGNREGA structure, under which the Centre bears the full cost of unskilled wages, up to 75% of material costs, and 75% of wages for skilled and semi-skilled workers.
Under the new framework, the Centre’s estimated share is Rs 95,692.31 crore, with the remaining expenditure borne by the states.
“With the likely contribution of the states, the total programme outlay is estimated to exceed Rs 1.51 lakh crore. This allocation is expected to provide fresh momentum to rural infrastructure development, large-scale employment generation and enhancement of rural incomes,” the ministry said in the statement.
Ulaka warned that the revised funding pattern could discourage several states from participating fully in the scheme.
“With this 60:40 arrangement, the scheme will fail automatically because states will not come on board across the country. The universality of the Act will no longer apply. There has been no consultation or discussion with states,” he said.
The ministry further stated that draft rules on wage payments, grievance redressal, allocation norms, and transitional provisions were being prepared in consultation with states and Union Territories and would soon be placed in the public domain for feedback.
Meanwhile, Nikhil Dey, a founder member of the Mazdoor Kisan Shakti Sangathan, said the key issue would be the method used to determine state-wise “normative allocations” under the new scheme.
“If the Act is coming in full scale, then what becomes most important is how these normative allocations are decided, because allocations will no longer be determined by demand from the ground. They will now be decided through a top-down process by the Centre,” Dey told TNIE.