New Rural Employment Bill Proposed by Central Government to Replace MGNREGA

The Central Government has unveiled a new rural employment bill intended to replace MGNREGA, promising to shift from a demand-driven to a supply-driven framework. Named the 'Developed India - Employment and Livelihood Mission (Rural) Bill', it aims to increase guaranteed employment from 100 to 125 days. However, concerns arise regarding the effectiveness of this change, as past reports indicate that states have struggled to meet even the original 100-day guarantee. Experts suggest linking the scheme to agriculture to enhance job opportunities and income for rural workers. As debates continue in Parliament, the real challenge remains whether these proposed guarantees can be effectively delivered to rural families facing ongoing economic hardships.

By Narendra Chaudhary Dec 17, 2025, 10:44 IST

Introduction of the New Employment Bill

The Central Government has introduced a new rural employment bill in the Lok Sabha, aimed at replacing the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). This initiative marks a significant shift in the approach to guaranteeing and funding rural jobs in India. The proposed legislation is titled 'Developed India - Employment and Livelihood Mission (Rural) Bill'. Its objective is to transition from the demand-driven, rights-based framework of MGNREGA to a supply-driven scheme with a fixed allocation determined by the central government.

Concerns Over Employment Guarantees

There are concerns regarding whether changes in name and structure will actually ensure job guarantees for rural families. The MGNREGA is being renamed to Developed India Guarantee for Employment and Livelihood Mission (Rural), or VB-G RAM G, with a commitment to increase guaranteed employment from the current 100 days to 125 days for each rural household.

Delivery Issues Highlighted

However, a report from the Ministry of Rural Development (MoRD) indicates that the issue lies not in the name but in the delivery of services. Despite the legal guarantee of 100 days of work, no state has managed to provide that level of employment on average. Over the past five years, rural families across the country have received only 50.35 days of work annually, which is about half of what MGNREGA promised.

Funding and Employment Statistics

The proposed scheme promises 125 days of wage employment with a 60:40 funding split between the center and states. If passed, this bill will repeal the 2005 MNREGA Act, which was initially implemented by the then United Progressive Alliance (UPA) government and later renamed MGNREGA on October 2, 2009. State-wise data reveals disparities between wages and actual employment. According to the MoRD report, Haryana offers the highest wage of ₹374 per day under MGNREGA for 2024-25, yet an average family received only 34.11 days of work, resulting in an annual income of just ₹12,757.

Comparative Analysis of States

The report also highlights Arunachal Pradesh, where the lowest daily wage is ₹234, providing an average of 67.9 days of work, leading to an annual income of ₹15,889, or approximately ₹43.5 per day. In Uttar Pradesh, one of the largest beneficiaries of this scheme, the situation is even worse, with a wage of ₹237 per day and an average employment of 51.55 days, yielding an annual income of only ₹12,217, or about ₹33.5 per day.

Linking MGNREGA to Agriculture

Vinod Anand, an expert in rural economics, argues that for MGNREGA to genuinely provide more work and income to registered workers, it should be strongly linked to the agricultural sector. He believes this connection could address multiple challenges, increase employment opportunities for workers, and reduce cost burdens on farmers. Anand suggests that under MGNREGA, agricultural work should offer a higher wage of ₹500 per day, with the government contributing ₹300 and farmers covering the remaining ₹200.

Potential Benefits of the Proposed Model

He asserts that this shared model would significantly enhance workers' earnings and ensure a steady flow of employment. Since agriculture requires labor throughout the year, registered workers could potentially find work for up to 200 days annually. Anand further states that this approach would help lower agricultural costs and redirect workers towards productive, ground-level tasks instead of limited-use projects. Linking MGNREGA to agriculture could also curb corruption, as work done in fields would be more visible and directly monitored by farmers and local communities.

Historical Context and Current Debates

This idea is not new. In June 2018, Prime Minister Narendra Modi established a high-level committee of governors to review major national issues. Chaired by then Uttar Pradesh Governor Ram Naik, the committee submitted its report to then President Ram Nath Kovind in October of the same year, recommending the integration of MGNREGA with agriculture. Despite this support, the proposal has yet to be implemented. As Parliament debates the proposed changes to MGNREGA, merely increasing the guarantee on paper from 100 to 125 days will hold little significance unless states can consistently generate employment. With rising inflation diminishing incomes and ongoing rural crises, the pressing question remains: can rural families survive on these guarantees, let alone thrive, when they often remain unfulfilled?