‘More Work Days, States To Share Fiscal Burden…’: MGNREGA Set For An Overhaul; Five Key Changes Govt Proposes In New Rural Job Guarantee Bill | Explained

New Delhi: The NDA government on Monday is planning to table the Viksit Bharat — Guarantee for Rozgar and Ajeevika Mission (Gramin) VB-G Ram G Bill, 2025, in Parliament, proposing a major overhaul of the nearly two-decade-old Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).

The new legislation seeks to “realign rural employment guarantees with the government’s broader vision of Viksit Bharat 2047”.

Here are the five key changes proposed in the Bill:

1. Guaranteed Work Days Increased From 100 To 125

The Bill proposes to increase the number of guaranteed wage employment days from the current 100 days to 125 days per rural household annually, expanding livelihood support under the rural job guarantee framework.

Section 3 (1) of the MGNREGA provides for “not less than one hundred days” of work per rural household in a financial year. But it has become the de facto upper limit, as the NREGA software does not allow data entry for employment exceeding 100 days per household in a year unless specifically requested by the State/UT. The government, however, allows an additional 50 days of wage employment (beyond the stipulated 100 days).

Besides, the government, under Section 3(4) of the MGNREGA, can provide an additional 50 days of unskilled manual work in a year, over and above the 100 days, in such rural areas where drought or any natural calamity (as per the Ministry of Home Affairs) has been notified.

2. Provision To Pause Work During Peak Farm Seasons

For the first time, the legislation allows a temporary pause of up to 60 days in scheme operations during peak agricultural seasons such as sowing and harvesting, to prevent labour shortage in farming activities.

“Notwithstanding anything contained in this Act or rules made thereunder, and to facilitate adequate availability of agricultural labour during peak agricultural seasons, no work shall be commenced or executed under this Act, during such peak seasons as may be notified under sub-section (2),” states Section 6(1) of the VB-G Ram G-Bill.

According to the Bill, the state governments will notify in advance, a period aggregating to 60 days in a financial year, covering the peak agricultural seasons of sowing and harvesting, during which works under this Act, will not be undertaken.

“All authorities responsible for planning, sanctioning or executing works under this Act shall ensure that all works are undertaken only outside the notified peak agricultural seasons,” as per the provisions of the Bill.

3. Weekly Wage Payments Mandated

To address chronic delays under MGNREGA, the Bill mandates weekly payment of wages, aiming to ensure timely income flow and reduce distress among rural workers, unlike MGNREGS, which has a 15-day limit.

“The disbursement of daily wages shall be made on a weekly basis or in any case not later than a fortnight after the date on which such work was done,” the VB-G Ram G-Bill states.

As per the MGNREGA, “In case the payment of wages is not made within 15 days from the date of closure of the muster roll, the wage seekers shall be entitled to receive payment of compensation for the delay, at the rate of 0.05% of the unpaid wages per day of delay beyond the 16th day of closure of muster roll.”

Under the VB-G Ram G-Bill, the wages will be the same as notified under Section 6 of the MGNREGA. The new Bill, however, retains the provision of payment of compensation for the delay in payment of wages.

4. Revised Centre-State Funding Structure

The Bill proposes changes to the existing funding pattern, increasing the financial responsibility of states as compared to MGNREGA, which was largely Centre-funded.

“For the purposes of this Act, the fund-sharing pattern between the Centre and the state governments shall be 90:10 for the Northeastern States, Himalayan states and Union Territories (Uttarakhand, Himachal Pradesh, and Jammu and Kashmir), and 60:40 for all other states and Union Territories with legislature,” states Section 22 (2) of the Bill.

However, for the Union Territories without a legislature, the Centre will bear the entire expenses of the Scheme.

5. State-Wise ‘Normative Allocation’

The VB-G Ram G Bill introduces “normative allocation” to determine funding for each state. The Centre will set the allocation for every state each year based on objective criteria. Any expenses beyond this allocation must be covered by the state, according to the proposed Bill.

The Bill defines “normative allocation” as “the allocation of the fund made by the Central Government to the State”.

This is different from the current labour Budget under MGNREGA, where states submit an annual work plan and Budget based on expected demand for unskilled work. Normative allocation fixes the funding limit from the Centre, rather than leaving it open-ended.

If passed, the Bill will repeal the MGNREGA Act, 2005, replacing it with a new statutory framework that integrates wage employment with livelihood creation and rural economic sustainability.

The government maintains that the proposed changes will modernise rural employment guarantees and improve efficiency, while Opposition parties are expected to raise concerns over reduced safeguards and higher fiscal pressure on states.

The Bill has been circulated among the members of the Lok Sabha and is likely to be introduced in the House.

The Winter Session of Parliament, which started on December 1, will conclude on December 19.

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