Earlier, Kerala CM Pinarayi Vijayan also wrote to the PM highlighting the challenges and disapproving of the law.
According to Siddaramaiah, while the new law raises the promised guarantee from 100 to 125 days, the promise is not matched by planning or assured Central funding. The new Act caps the Union Government’s financial responsibility to a “normative allocation” for a “notified” area of each State, with the Centre contributing only 60% of that allocation. As a result, the so-called legal guarantee of 125 days is not absolute, Siddaramaiah said, fearing that the new law may leave many Gram Panchayats without funds.
A demand-driven regime is being converted into a supply-driven, top-down system, contrary to the current participatory approach where labour budgets are prepared at the Gram Panchayat level and allocations follow demand generated from villages, the CM said.
“Under the existing MGNREGA framework, mainstream States follow a 90:10 Centre-State sharing arrangement. The new Act shifts this to 60:40 for most States, converting a statutory guarantee into a run of the mill scheme and placing significant additional burden on State finances, especially when States are already under fiscal stress due to non-compensation of GST and unjust financial devolution. This shift appears to have been introduced without meaningful consultation with State Governments.”
The new Act further states that any expenditure incurred by a State beyond its normative allocation shall be borne by the State Government as per procedures prescribed by the Centre. This could leave States facing 100% liability for demand beyond a centrally fixed limit, the Karnataka CM noted.
“The Act also requires States to notify in advance an aggregate 60-day period during peak sowing and harvesting seasons when works under the Act shall not be undertaken. While agricultural activity may increase during that time, such a blanket restriction curtails the right of those who still need wage employment, particularly vulnerable groups, including tribal and marginalised communities, who may not find adequate farm work,” Siddaramaiah said.