The LPG gas crisis triggered by the ongoing West Asia conflict has triggered millions of migrant workers to move from cities to villages. But unlike the COVID-19 pandemic, this time these workers have no safety net of the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) to support with employment.
The central government replaced the flagship scheme with the Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-GRAMG) Act, 2025, which was expected to be rolled out from financial year 2026-27. But no central government guidelines have been issued to implement the scheme.
The NREGA Sangharsh Morcha (NSM) has analysed that since April 1, the rural employment programme has come to near standstill, with the works under MGNREGS effectively suspended as officials on ground have no clarity on the rollout of GVB-GRAMG.
The situation arises amid growing labour unrest across the country, with recent demonstrations by labourers and industrial workers in Gurgaon and Noida demanding minimum wages and raising exploitative working conditions.
Chakradhar Buddha, a researcher with LibTech India, a non-profit that works on democratic engagement in rural public services delivery, said, “There is still no clarity on when the transition will actually begin. It was widely expected that it would start from April 1, but no formal timeline has been communicated. Senior officials from the rural development ministry have stated publicly that the ongoing works under MGNREGA will be allowed to continue until completion, after which the newly replaced programme will be rolled out.”
Buddha said that despite that, significant ambiguity remains. For instance, it is unclear whether normative state-wise budgets under the new system have been determined. This is particularly concerning because most state budgets were already finalised before the normative budgets were determined, making the allocations themselves somewhat ambiguous and, in some sense, arbitrary, he added.
Overall, there is still significant uncertainty on how and when this shift will be operationalised. According to a statement from NSM, workers across states have reported that no work is being provided anywhere. “Local officials are refusing to accept applications for work, citing lack of instructions on VB-GRAMG, while also claiming they have been directed not to initiate new works under MGNREGA,” it said.
Even where worker pressure has led to work applications being accepted — as in some districts of Karnataka, Rajasthan and UP — no new worksites have been opened. Only a handful of workers are being absorbed into old works sanctioned before February, leaving the vast majority without work, it added.
The NSM statement said that some officials are citing a ministry circular from July 2021, imposing a cap of 20 works per panchayat on NREGASoft, an e-governance platform to manage MGNREGA workflow. This arbitrary technical restriction has long been criticised by workers’ groups as illegal and in violation of the MGNREGA Act. Yet, it continues to be used to deny workers their statutory right to employment.
An analysis of the MGNREGA Management Information System (MIS) by Laavanya Tamang, a senior researcher at the Foundation for Responsive Governance and affiliated with NSM, found that this reflects the collapse happening on ground.
“In 2025, 260 million persondays were generated in April. In 2026, till 15 April, only 9.5 million persondays have been generated — a mere 4 per cent of April 2025 persondays. Additionally, in the final quarter of FY 25-26, after the VB-GRAMG Act was passed, only 210 million persondays of work were generated across the country, which is 31 per cent lower than the same period in FY 24-25,” she said.
Tamang added that this is despite the fact that the revised MGNREGA budget was higher in FY 25-26 than the previous year. The lack of clarity regarding the status of MGNREGA also reflects in wage payments — nearly no wage payments have been cleared across all states since January 21, 2026, with nearly Rs 10,000 crore of wages pending.
Carina Singh, a lawyer and researcher working on labour rights associated with NSM, said the process becomes difficult to complete given the network connectivity issues, location capturing and the quality of device each worker has.
“Workers have to jump through hoops to mark attendance and it has become even more tedious / cumbersome — asked to blink multiple times, remove chunni or any kind of face covering, wipe sweat, stand in better light, etc,” Singh said. In some cases, she added, the attendance doesn’t end up getting recorded at all — at a worksite in UP’s Sitapur, only seven out of 25 workers were marked present even though all 35 worked.
The NSM statement cited examples of workers from Jharkhand who complained about wages pending for months. These systemic issues are discouraging workers from even demanding work, thus slowly dismantling the world’s largest work guarantee programme.
Further, NSM said that for the first time in over 10 years, revised MGNREGA wage rates have not been notified before the start of the financial year. With the revised cost sharing ratio of 60:40 under VB-GRAMG, where states will have to bear 40 per cent of all costs, there is no reason for the notified wage-rate to be less than the state’s notified minimum wage.
The situation is concerning in West Bengal where no MGNREGA has been implemented since December 2021 despite a Calcutta High Court ruling in June 2025 ordering the resumption of the scheme.
MGNREGS workers and activists have called for a mass strike on May 15 to demand immediate rollback of the VB-GRAMG Act and reinstating strengthened MGNREGS. They have also demanded increasing employment guarantee to a minimum of 200 days per rural household with a minimum wage allocation of Rs 700 per cent indexed to annual inflation.
The long-standing demand to withdraw exclusionary technological process for attendance and wage payments will also be raised. The workers have also asked for giving powers to Gram Sabhas for planning, implementation and monitoring of rural employment works.
