The Indian Parliament passed a landmark legislation last week, the VB-G RAM G Bill, which repeals and replaces the two-decade-old Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). The passage occurred via voice vote in the absence of both Prime Minister Narendra Modi and Leader of the Opposition Rahul Gandhi, who were abroad.
Bypassing Parliamentary Scrutiny Raises Questions
The government's decision not to refer the Bill to a parliamentary standing committee for detailed scrutiny has sparked criticism. This move is considered inexplicable, especially since two other significant bills—one concerning higher education regulation and another for a unified Securities Market Code—were sent to the relevant House committees for examination. Given that MGNREGA provides wage employment to nearly 6 crore rural households for an average of 50 days annually, any law seeking to overhaul it warranted extensive debate and expert consultation.
This approach mirrors the government's handling of the now-repealed farm laws, which also bypassed committee scrutiny. The haste in passing the VB-G RAM G Bill has led to questions about the urgency and the lack of transparent legislative oversight for a scheme with such vast reach and impact.
From UPA's Flagship to Modi-Era Streamlining
While MGNREGA was the flagship programme of the Congress-led UPA government, the Modi administration has implemented significant technological reforms. These include integrating Aadhaar-linked bank accounts with the NREGASoft MIS platform and geo-tagging created assets to ensure funds reach intended beneficiaries.
The scheme's critical role was most visible during the Covid-19 pandemic. In the financial years 2020-21 and 2021-22, MGNREGA generated a staggering 389.09 crore and 363.19 crore person-days of employment, respectively. The number of households that worked under the scheme also hit record highs of 7.55 crore and 7.25 crore in those years, proving its value as a social safety net.
Key Departures: From Demand-Driven to Centre-Determined
The new Bill introduces fundamental changes to the architecture of the rural job guarantee scheme. Under the old MGNREGA, the scheme was demand-driven, allowing any rural household to seek up to 100 days of manual work per year. The central government bore the entire wage cost and 75% of the material expenditure.
The VB-G RAM G Bill alters this framework in several crucial ways:
- Normative Allocation: The Centre will now determine a "normative allocation" of funds for each state, shifting the scheme from a demand-based model to a supply-driven one.
- Cost Sharing: The central government's share of the scheme's cost is reduced, with it now covering only 60%, placing a higher financial burden on states.
- Potential for Bias: The Centre's unilateral power to decide state-wise fund allocation opens the possibility of political favoritism, critics argue.
These structural shifts represent a significant policy change. The reduction in central funding and the move away from a legally guaranteed demand-based framework could impact the scheme's effectiveness as an automatic stabilizer during economic distress. The lack of extensive legislative debate on these substantial amendments has become a focal point of contention, with demands for greater public consultation and oversight remaining unaddressed.
