The Hollow Guarantee, How the Viksit Bharat-GRAMG Act Undermines the Right to Work and Worker Rights
In a nation where unemployment remains a persistent specter and rural distress a chronic reality, the state’s promise of work is not a mere welfare scheme; it is a fundamental economic right and a lifeline for millions. The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), 2005, despite its implementation flaws, enshrined this right with a degree of legal robustness, guaranteeing 100 days of wage employment per rural household on demand. The recent passage of the oddly acronymed Viksit Bharat-Guarantee for Rozgar and Aajeevika Mission (Gram) Act, or VB-GRAMG Act, has been presented by the Union government as a progressive expansion of this social contract. However, as economist and former NAC member Jean Drèze meticulously deconstructs in a searing critique, the new legislation represents not an enhancement, but a profound dilution and potential betrayal of the employment guarantee principle. Far from strengthening workers’ rights, the VB-GRAMG Act is a masterclass in legislative subterfuge, playing a perilous game of hide and seek with the very guarantee it purports to offer.
The central pillar of Drèze’s critique, and the most damning flaw of the VB-GRAMG Act, lies in its conditional and discretionary guarantee. Union Minister Shivraj Singh Chouhan and other proponents have trumpeted the increase in guaranteed days from 100 to 125 per household. Yet, this superficially attractive number conceals a fatal caveat embedded in Section 50 of the new Act. The employment guarantee applies only “in such rural area in the State as may be notified by the Central government.” This single clause eviscerates the core philosophy of MGNREGA. The original Act’s power derived from its universal, demand-driven, and justiciable guarantee. Any adult rural resident could apply for work, and the state was legally obligated to provide it within 15 days or pay an unemployment allowance. The VB-GRAMG Act replaces this right with a conditional privilege, subject to the administrative and likely political whims of the central government. As Drèze aptly notes, it is “like providing a work guarantee without a guarantee that the guarantee applies.” This switch-off provision transforms the scheme from a legal right into a centrally administered program that can be turned on or off for specific regions, effectively punishing states or areas deemed politically non-compliant or financially burdensome.
The government’s defense, as highlighted by Drèze, often revolves around peripheral or misleading arguments, which he systematically dismantles. One such claim is the removal of “disentitlement provisions.” Drèze clarifies that this refers to an obscure, never-used clause in MGNREGA meant to deter frivolous applications—a problem he states has “never arisen in a serious way in the last 20 years.” Presenting the removal of this irrelevant clause as a major pro-worker reform is, in his words, “little more than hot air,” a smokescreen to distract from the substantive regressions elsewhere.
A more substantive, yet equally problematic, argument from proponents is the shift from a demand-driven to a “normatively funded” model. Champions like State Bank of India’s Dr. Soumya Kanti Ghosh praise this as a move away from an “archaic demand-driven approach.” This framing is telling, as it openly abandons the logic of a guarantee. A true employment guarantee must be demand-driven; its budget is an open-ended commitment to meet the demand for work from citizens. “Normative funding” implies the imposition of pre-set budget caps by the Centre. Drèze and other critics argue, convincingly, that these normative allocations will inevitably become de facto expenditure ceilings. When demand for work spikes during a drought or economic downturn, states will be unable to respond beyond their capped allocation, leaving workers in the lurch and nullifying the guarantee in times of greatest need. This shifts the financial risk of unemployment from the state (where it belongs in a rights-based framework) onto the most vulnerable workers.
Proponents argue that normative funding will ensure a more equitable distribution of funds across states, correcting a perceived bias toward better-off states like Tamil Nadu and Kerala. Drèze counters this with data, showing “no statistical correlation” between MGNREGA employment per household and baseline poverty rates. High employment is found in both poorer (Chhattisgarh) and richer (Tamil Nadu) states, just as low employment is found in poorer (Bihar) and richer (Gujarat) states. The disparity, he argues, stems from governance capacity and political will, not the funding model. The solution to low uptake in states like Bihar is not to cap the efficient states but to improve implementation in the lagging ones—for instance, by raising the abysmally low MGNREGA wage rates in poorer states to make the work more attractive. Imposing caps simply drags everyone down to a lower common denominator, penalizing good governance and doing nothing to uplift the poor in poorly governed states.
Another sales pitch for the VB-GRAMG Act is its supposed focus on eliminating corruption through advanced digital technology. Drèze dismisses this as “blind faith” that ignores the lessons of MGNREGA’s own digital journey. While technology can bring transparency, its top-down, rigid imposition has often “undermined workers’ rights and sapped their interest.” He cites the infamous 2017 case where wages were diverted to Airtel payment banks, a technological “solution” that created a new problem. When complex digital processes fail or become exclusionary for the less literate or poorly connected, they don’t eliminate corruption; they often displace and reshape it. Frustrated workers, unable to navigate a broken digital system, may turn to corrupt middlemen who promise to “manage” their job cards and bank accounts for a cut. The VB-GRAMG Act’s relentless emphasis on technology, without addressing these documented pitfalls, risks exacerbating exclusion and alienation rather than empowering workers.
Perhaps the most disingenuous aspect of the pro-VB-GRAMG rhetoric, as Drèze highlights, is the attempt to claim credit for provisions copied verbatim from MGNREGA. BJP spokesperson Tuhsin A. claiming that the new Act “addresses head-on” delayed wages by mandating weekly payments is blatantly misleading, as this was already a provision in MGNREGA. Similarly, claims about strengthened social audits are based on sections nearly identical to the old Act. This copy-paste repackaging, coupled with the evisceration of the core guarantee, reveals the true political motive: to enable the central government to “run the show and steal the credit,” as Drèze puts it, drawing a parallel to the repackaging of the National Food Security Act into Prime Minister’s schemes. The branding overhaul from “Mahatma Gandhi” to “Viksit Bharat” and “GRAM” is part of this political project, seeking to dissociate a popular UPA-era legacy and rebrand it as a new Modi government initiative, even as its substantive rights are hollowed out.
The implications of this legislative shift are profound. The VB-GRAMG Act represents a fundamental philosophical retreat from rights-based entitlements to discretion-based welfare. It centralizes power in New Delhi, weakening the federal contract and making rural employment contingent on political and fiscal calculations rather than legal right. It substitutes the security of a guarantee with the uncertainty of a capped scheme. For the rural worker, this means their right to work—a buffer against hunger, distress migration, and economic shock—has become more precarious.
In conclusion, the VB-GRAMG Act is a wolf in sheep’s clothing. Its enhanced day-count is a shiny lure that distracts from the dismantling of the guarantee’s very architecture. As Jean Drèze’s rigorous dissection demonstrates, the arguments in its favor crumble under scrutiny, revealing a structure built on discretionary power, budget caps, technological fetishism, and political rebranding. The fight over this Act is not merely a technical debate about social policy; it is a battle for the soul of India’s social contract. Will the state’s duty to provide work in times of need remain a justiciable right of the citizen, or will it become a charitable handout, granted or withdrawn at the discretion of the powerful? The VB-GRAMG Act, in its current form, alarmingly chooses the latter path, leaving India’s rural workers to play a desperate and rigged game of hide and seek with their own right to survival.
Q&A: Decoding the VB-GRAMG Act Controversy
Q1: What is the single most critical flaw in the VB-GRAMG Act according to Jean Drèze’s analysis?
A1: The most critical flaw is the conditional and discretionary nature of the guarantee, established by Section 50 of the Act. This clause states the guarantee applies only in rural areas “as may be notified by the Central government.” This destroys the universality and justiciability of the right to work, transforming it from a legal entitlement enforceable by any rural household into a scheme that the Centre can selectively “switch on or off” for specific regions. It replaces a right with a revocable privilege.
Q2: How does the shift to “normative funding” fundamentally change the nature of the employment guarantee?
A2: Normative funding means replacing MGNREGA’s demand-driven, open-ended financial commitment with pre-set budget caps determined by the Centre. A true employment guarantee must be demand-driven—funding must expand to meet whatever work demand materializes, especially during crises. Normative funding inverts this logic, imposing a ceiling. When demand exceeds the capped allocation (e.g., during a drought), the “guarantee” will fail, as states will have no funds to provide work. It shifts the financial risk of unemployment from the state’s treasury onto the vulnerable worker.
Q3: Does Drèze agree with the argument that MGNREGA funds were unfairly skewed toward richer states, and is normative funding the solution?
A3: No. Drèze presents data showing no statistical correlation between per-household MGNREGA employment and baseline poverty across states. High employment occurs in both poor (Chhattisgarh) and richer (Tamil Nadu) states, driven by governance and political will, not the funding model. He argues normative funding (caps) is a poor solution; it punishes well-governed states without helping poor states like Bihar or Jharkhand improve. A better solution would be to raise MGNREGA wage rates in poorer states to make the work more attractive and address the root cause of low uptake.
Q4: What is Drèze’s critique of the VB-GRAMG Act’s heavy reliance on digital technology to curb corruption?
A4: Drèze argues this reflects a “blind faith in digital technology” that ignores the mixed and often negative record of tech interventions in MGNREGA. He points out that complex, top-down digital systems have sometimes undermined workers’ rights, caused exclusion, and even fuelled new forms of corruption (e.g., the 2017 Airtel vault wage diversion). When systems fail, frustrated workers may turn to middlemen who misuse their job cards. Instead of learning from these failures, VB-GRAMG doubles down on technological fixes without ensuring they are worker-friendly and accountable, risking further alienation.
Q5: What does Drèze identify as the underlying political motive behind repackaging MGNREGA as the VB-GRAMG Act?
A5: Drèze suggests the primary motive is political rebranding and credit-claiming, akin to the repackaging of the National Food Security Act. By renaming the scheme (dropping “Mahatma Gandhi,” adding “Viksit Bharat”), copying existing provisions (like wage payment timelines), and claiming them as new innovations, the government seeks to “run the show and steal the credit” for a popular program. This allows it to dissociate from a UPA-era legacy while centralizing control, even as the substantive right (the unconditional guarantee) is severely weakened. The exercise is about political narrative control as much as policy change.
