The TDP is likely to press for a Parliamentary Committee to examine the Bill. The BJP ally fears that the Bill, once passed, will affect states' finances — a core argument Opposition parties has been making.
Published Dec 16, 2025 | 9:47 PM ⚊ Updated Dec 16, 2025 | 9:47 PM
The VB-G RAM G Bill proposed increasing the number of employment days from 100 to 125, but posed a higher financial burden on states — except Northeastern states, Himalayan states and Union Territories — with a 60:40 share of the fund allocation.
The Narendra Modi-led government’s ambitious move to replace the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) with Viksit Bharat-Guarantee for Rozgar and Aajeevika Mission (Gramin), or VB-GRAMG., has run into opposition from within the NDA.
The TDP, a key ally of the BJP, has warned that the proposed changes could strain state finances.
The BJP-led NDA government decided to repeal the MGNREGA, the flagship social welfare scheme, and replace it with VB-GRAMG. The MGNREGA had guaranteed employment in rural areas for two decades since its launch.
The VB-GRAMG Bill, introduced in Parliament on Monday, 15 December, proposed increasing the number of employment days from 100 to 125, but posed a higher financial burden on states — except Northeastern states, Himalayan states and Union Territories — with a 60:40 share of the fund allocation.
Under the MGNREGA, the Union government met the full cost of wages for unskilled manual work, up to three-fourths of material costs, and three-fourths of wages for skilled and semi-skilled workers.
Though the Bill stated that the scheme shall be centrally sponsored, 40 percent of the financial burden would fall on the states.
“For the purposes of this Act, the fund-sharing pattern between the Central Government and the State Governments shall be 90:10 for the North Eastern States, Himalayan States and Union territory (Uttarakhand, Himachal Pradesh and Jammu and Kashmir), and 60:40 for all other States and Union territories with legislature,” the Bill stated.
Additionally, the Union government decided the state-wise normative allocation for each financial year, based on objective parameters prescribed by it. This provision will end the open-ended funding mechanism under MGNREGA.
“Any expenditure incurred by a State in excess of its normative allocation 35 shall be borne by the State Government in such manner and by such procedure as may be prescribed by the Central Government,” it added.
Further, the Union government would identify the rural areas in the states, and the state governments must provide 125 days of guaranteed employment.
“Save as otherwise provided, the State Government shall, in such rural area in the State as may be notified by the Central Government, provide to every household whose adult members volunteer to do unskilled manual work, not less than one hundred and twenty-five days of guaranteed employment in a financial year in accordance with the Scheme made under this Act,” the Bill said.
The TDP, the second-largest constituent of the NDA at the Centre with 16 Lok Sabha members, opposed the Viksit Bharat G RAM G scheme, citing the burden it would place on Andhra Pradesh, The Economic Times reported.
“This new funding pattern will put an obvious burden on the state government. It is of great concern, especially for a cash-strapped state like Andhra Pradesh,” The Economic Times quoted a senior state minister, who reportedly requested anonymity.
The minister further said the funding pattern would make the rural employment guarantee scheme like any other central plan.
The report, quoting TDP sources, said the party will demand a parliamentary standing committee to examine the Bill.
The BJP defended the VB GRAMG Bill, saying it “upgraded” — not diluted — the job guarantee.
“MNREGA suffered from deep structural flaws… This is not just rebranding, but a necessary legal reset to build a cleaner, stronger framework,” the BJP posted on X.
Senior Congress leader and Thiruvananthapuram MP Shashi Tharoor said the Bill, besides an administrative tweak, was an assault on the very spirit and philosophical foundation of MGNREGA.
Taunting the government, he recalled a hit number from the 1971 Bollywood hit, Hare Rama Hare Krishna, and asked the Modi dispensation, “Ram ka naam badnaam na karo“.
Tharoor said the VB–G RAM G Bill represented a deeply regrettable and retrograde step for the nation and the nation’s commitment to the welfare of its most vulnerable citizens.
“My first objection, as with others, is the ill-advised decision to remove the name of the Father of the Nation, for the reasons already stated, which I will not repeat. But this is not merely an administrative tweak; it is an assault on the very spirit and philosophical foundation of this crucial programme.
Mahatma Gandhi’s vision of Ram Rajya was never a purely political project. It was a socio-economic blueprint rooted in the empowerment of villages, and his unwavering faith in Gram Swaraj was central to that vision. The original Act, by bearing his name, acknowledged this profound connection—that true employment guarantee and upliftment must flow from the grassroots, embodying his principle of placing the last person first. To remove the name of Mahatma Gandhi is to strip the bill of its moral compass and historical legitimacy,” the senior lawmaker said in Parliament.
We must also seriously question the financial restructuring proposed in the Bill. The proposal to impose 40 percent of the financial burden directly on state governments is not merely fiscally irresponsible; it is a measure that threatens to make the entire programme unviable. This sudden and massive shift in liability will inevitably make implementation impossible for poorer states. It will lead to delays in wage payments, a reduction in the number of workdays, and ultimately the destruction of the scheme itself. This is a clear violation of fiscal federalism, which is why I believe we lack the legislative competence to undertake such a change.
Finally, the Bill makes the scheme contingent upon executive notification, allowing the Union to decide when and where it will operate. This fundamentally alters the very nature of the programme,” he added.
Congress General Secretary and Wayanad MP Priyanka Gandhi pointed out that the original Bill was passed with consensus across the political spectrum.
“The Modi government has an obsession with renaming schemes. Every time a name is changed, the government’s money is spent. This scheme is named after Mahatma Gandhi ji, who is our Father of the Nation, and he should not be disrespected,” she said.
“When this law was made in this House, no political party expressed any disagreement. It was made into law with everyone’s consensus that it would provide 100 days of employment to the poor people of the country,” she said.
She alleged that the government had “slyly added two-three such things in this Bill” to create the impression that workdays had increased, while in reality the scheme would be weakened and would offer “no provision to increase earnings”.
The CPI(M) expressed apprehension that the Centre could now punish Opposition-ruled states by cutting down allocations. “The buck is being passed on to states,” the party’s general secretary, MA Baby, said.
Kerala Chief Minister Pinarayi Vijayan strongly criticised the Union government’s move to rename and restructure MGNREGA.
He said the NDA government plans to scuttle the scheme, not just to rename it. The agenda behind the Bill is to make the employment guarantee scheme allocation-based. It is now demand-driven. He also expressed concern over the cut in the Union Budget
allocation for Kerala, once the Bill becomes an Act.
Vijayan urged the Centre to desist from pushing the Bill.
Kerala’s Minister for Local Self-Government, MB Rajesh, accused the Centre of running away from its financial responsibility. He added that the Bill was part of an agenda to dismantle the scheme.
He said Mahatma Gandhi’s name has been removed and replaced with Ram. “Everyone knows this is not the Ram associated with Gandhiji,” he said in an oblique reference to Nathuram Godse.
In Tamil Nadu, Chief Minister MK Stalin led the protest against the Bill, accusing it of being a move to systematically dilute and dismantle the MGNREGA.
In a statement, Stalin alleged that driven by animosity towards Mahatma Gandhi, the Centre had removed his name from the scheme and imposed a “hard-to-pronounce Sanskritised name”. He further charged that the Union government was now planning to reduce its funding share for the scheme from 100 per cent to just 60 percent.
The DMK leader said Tamil Nadu was being “punished” despite achieving what he called a national milestone in eliminating extreme poverty. “Because Tamil Nadu has successfully reduced poverty, the state will now receive the least benefits under the scheme,” he said, calling the move unjust and discriminatory.
Stalin asserted that MGNREGA had helped crores of people escape poverty and live with dignity, and accused the Union government of attempting to destroy the programme with “arrogance”.
Drawing parallels with the rollback of the three farm laws and the demand for a caste census, Stalin warned that public resistance would once again force the Centre to retreat. He urged the Union government to immediately abandon the proposed VB-G RAM G plan and stop weakening MGNREGA to avoid public outrage.
Priyank Kharge, Karnataka’s Minister for Rural Development and Panchayat Raj the Union government is repealing MGNREGA by stealth.
“The Modi Government may keep the outer shell of NREGA, but it has ripped out its spine — the legal, enforceable right to work,” he said on X.
“This Bill is a classic BJP model: Delhi grabs all the power, States are left to carry the burden. The Centre will control the scheme, dictate the terms, and still avoid accountability — while States are expected to manage the fallout, fund the gaps, and face people’s anger.
In short, the Government is downgrading a hard-won constitutional promise of dignity through work into a token, centrally-controlled programme with no enforceable rights.
VB-G RAM G is an assault on rural livelihoods and federalism, and it must be opposed, tooth and nail,” he said.
