On 6 January 2026, Odisha Chief Minister Mohan Charan Majhi stood before the press in Bhubaneswar to defend one of the most consequential policy shifts affecting rural workers in the state—the repeal of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) and its replacement with the Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (Gramin) Act (VB-GRAMGA).
Majhi argued that MGNREGA failed due to administrative shortcomings, structural weaknesses and large-scale corruption. He claimed that although MGNREGA guaranteed 100 days of work, beneficiaries received only around 50 days of work per year and that unemployment allowances were not implemented effectively. According to the CM, the new legislation VB-GRAMGA increases work provision to 125 days, harnesses technology, prioritises water security and rural infrastructure, and aligns with a vision of “Developed India by 2047.” He also defended the cost-sharing pattern of 60:40 between the Centre and states.
It is critical to assess these claims against rights, law, and Odisha’s own fiscal realities.
Legal dilution: a right, not a promise:
There are 1.9 crore MGNREGA workers in the state, belonging to 67 lakh job-card holding families. In the last four financial years, the number of families that have completed 100 days of guaranteed employment was 4.57 lakh in 2021-22, 4.16 lakh in 2022-23, 3.39 lakh in 2023-24 and only 2 lakh in 2024-25.
On the other hand, the average days of employment per household in the state was 57 days in 2021-22, 55 days in 2022-23, 56 days in 2023-24 and 51 days in 2024-25.
Both sets of data point to a sustained decline in recent years, suggesting the state’s failure to achieve even the statutory 100 days under the scheme. However, when one looks at the budget released by the Centre to the state under the scheme, it was ₹5409 crore in the financial year 2020-21 and ₹3792 crore in the year 2024-25, amounting to a 30% decline.
Another defining feature of MGNREGA was not the number of days of employment; it was the justiciable right conferred on workers. Under MGNREGA, workers could demand employment and had a statutory right to receive work within 15 days, failing which they would receive unemployment allowance, with compensation for delayed wages. These were enforceable obligations on the state. On the other hand, under VB-GRAMGA, there is no guarantee of 125 days, rather it depends upon the normative allocation by the central government.
Majhi acknowledged that MGNREGA’s guarantee on paper did not translate into real work for many. But removing the legal architecture behind this entitlement does not solve the issue. Without robust legal guarantees and an increase in budget allocation, the increase in number of days is symbolic inflation, not a substantive right.
Fiscal shift: a heavy burden on Odisha
The Chief Minister’s statement highlighted the cost-sharing formula of 60:40 between the Centre and states under VBGRAMGA. What remains under-examined is what this means for Odisha’s finances.
According to MGNREGA MIS data in FY 2024–25, a total of ₹4636 crore was spent in Odisha, out of which ₹3186 crore was on unskilled wages, entirely paid by the government of India. The rest of ₹1450 crore was spent on skilled wages, materials, and administrative cost and the Odisha government spent a total of ₹341 crore as part of its 25 percent share on these components. Odisha’s share was 7% of the total money spent in the state under MGNREGA.
If last year’s expenditure pattern applied under VB-GRAMGA, under unskilled wages the state will now have to contribute 40%, which will increase the state’s liability to ₹1274 crore, with an additional ₹580 crore on other components. That means the state’s liability would increase from ₹341 crore to ₹1854 crore.
This implies an additional burden of about ₹1,500 crore per year – more than a five-fold increase in the State’s contribution for the same scale of rural employment.
Without a budgetary commitment, the scheme becomes expensive for states to deliver, rather it is subjected to rationing through budgets, ceilings on work allocation. What was once an enforceable right is transformed into a state budget line item, vulnerable to political and fiscal cycles.
Corruption narrative and the technology turn
Majhi blamed MGNREGS’s weaknesses on corruption and weak implementation. There is no disagreement that corruption is a serious cause of concern in MGNREGA. However, VB-GRAMGA addresses it almost exclusively through technological fixes. Most of these measures, from geo-tagging to the use of mobile applications and dashboards, have been in use for some time now.
The increased use of technology in MGNREGA served to centralise control and obscure local accountability, becoming primary reasons for the exclusion of workers and the denial of wages.
Several reports and payment-tracking exercises have shown that the primary problem under MGNREGA was not insurmountable “leakage” but delayed and denied payments, and inadequate grievance redressal.
Embedding technology as a gatekeeper without legally required access, appeal rights, and offline alternatives risks exclusion of workers and leads to an increase in corruption.
Seasonal suspension: who bears the cost?
The Chief Minister justified suspending VB-GRAMGA work during sowing and harvest seasons to avoid labour shortages in agriculture and curb wage inflation.
In Odisha, a substantial share of MGNREGA workers are landless or marginal farmers for whom public employment is a fallback when agricultural work is insufficient, exploitative, or unavailable. The assumption that agriculture will absorb the majority of workers during the peak agricultural seasons does not hold, especially in the dominant tribal districts in south and north Odisha and the rainfed districts of western Odisha. It is also not clear which authority will decide the peak agriculture seasons since it varies even within districts. The tendency of the state machinery of simplifying policy is likely to to be uniform across the state without any regard for decentralised planning or the rights of the worker to demand work when they actually need.
Centralisation vs Decentralised accountability
Majhi’s press remarks underline a belief in technology and centralised frameworks as substitutes for deep decentralisation. Yet Odisha’s climate variability, cyclones, floods, droughts, and patterns of seasonal migration demand locally responsive, democratically accountable employment systems.
VB-GRAMGA’s centrally designed norms and digital systems risk diluting Gram Sabha and Panchayat oversight, making local claims harder to enforce.
Conclusion: A right under strain
The repeal of MGNREGA and replacement with VB-GRAMGA for Odisha means higher state burden, weaker guarantees, and deepening exclusion where access to work depends not on demand and entitlement, but on budgets, technology, and administrative ceilings. Unless central funding, legal enforceability, and decentralised accountability are restored, the promise of 125 days risks remaining a nominal guarantee, replacing a constitutional right.
**Sameet is a researcher working on social protection, employment guarantee programmes and welfare accountability. He has been associated with the Right to Food Campaign and LibTech India. The views expressed are personal and do not necessarily reflect those of IndiaVerve.
