SAD opposes proposed 60:40 funding ratio for MGNREGS, warns Punjab will be worst hit
Babushahi Bureau
Chandigarh, December 16, 2025: The Shiromani Akali Dal (SAD) on Tuesday strongly opposed the Union government’s proposal to introduce a 60:40 Centre–State funding ratio for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) under the proposed Viksit Bharat Guarantee for Rozgar and Aajeevika Mission (Gramin) framework.
In an official statement, the SAD described the proposed cost-sharing formula as unacceptable, stating that it dilutes the very spirit of MGNREGS and defeats its core objective of providing guaranteed livelihood security through wage employment in rural areas.
The party asserted that Punjab would be among the most adversely affected states, given its agrarian economy and large rural workforce. “Shifting the financial burden to the States undermines the scheme’s universal nature and runs contrary to the principles of cooperative federalism,” the SAD said.
Urging the Centre to immediately review and withdraw the proposal, the party demanded a return to the original framework with 100 per cent central funding of wages, asserting that only then could the scheme continue to effectively combat rural poverty and unemployment without placing additional financial stress on States.
ureaHighlighting the ground realities in Punjab, the SAD said the AAP-led state government has already defaulted on its share in several centrally sponsored schemes, causing hardships to people. It cited delays and disruptions in key programmes, including the SC Scholarship scheme, which have denied benefits to weaker sections.
“Under such circumstances, placing the additional burden of MGNREGS funding on the Punjab government could result in the poorest of the poor being denied even their daily wages,” the statement warned.
Describing MGNREGS as a crucial safety net for millions of rural households, especially during times of economic distress, the SAD cautioned that imposing a substantial financial obligation on States could render the scheme ineffective in many regions.
“Several States facing fiscal constraints simply do not have the capacity to contribute 40 per cent of the costs. This will inevitably lead to reduced utilisation of the scheme, fewer employment opportunities, and increased vulnerability among rural populations,” the party asserted.