BJP uses Gandhi, Lord Ram for propaganda, don't follow their ideals: Surjewala on VB-G RAM G

The statement by Congress MP Randeep Surjewala regarding the funding mechanisms of government schemes, specifically comparing MGNREGA with the purported VB-G RAM G, brings to the forefront critical aspects of India's fiscal federalism, welfare policy, and political discourse. This analysis delves into the implications of such funding shifts for competitive exam aspirants.

**Background Context: Understanding Welfare Schemes and Funding**

India's approach to social welfare and rural development has historically relied heavily on government-backed schemes. The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), enacted in 2005 (initially as NREGA, renamed in 2009), stands as a cornerstone of rural livelihood security. It guarantees 100 days of wage employment in a financial year to every rural household whose adult members volunteer to do unskilled manual work. A key feature of MGNREGA, as highlighted by Surjewala, is its funding structure: the central government bears 100% of the wage cost for unskilled labour and 75% of the material cost (with 25% by states). This makes it largely a 'Central Sector Scheme' in terms of wage funding, ensuring states are not overly burdened by the primary cost of employment generation.

India's welfare architecture broadly categorizes schemes into two types: 'Central Sector Schemes' (100% funded by the Centre, implemented by central agencies or directly by states as agents) and 'Centrally Sponsored Schemes' (CSS) (funded jointly by Centre and States, implemented by states). The funding ratios for CSS vary, often being 90:10 for North-Eastern and Himalayan states, and 60:40 or 50:50 for other states. The shift from a 100% central funding model to a 60:40 Centre-State sharing model, as alleged for VB-G RAM G, signifies a move towards the CSS framework.

**What Happened: The Allegation and its Core**

Congress MP Randeep Surjewala's criticism centers on two main points. Firstly, he alleges that the BJP government uses revered national figures like Mahatma Gandhi and Lord Ram for 'propaganda,' implying a political appropriation of ideals. Secondly, and more concretely for governance and economy, he points out a significant difference in the funding pattern of the new VB-G RAM G scheme compared to MGNREGA. While MGNREGA's wage component is entirely centrally funded, the VB-G RAM G scheme reportedly mandates states to bear 40% of the cost. Although the specifics of VB-G RAM G are not detailed in the provided context, the implication of its funding structure is central to the debate.

**Key Stakeholders Involved**

1. **Central Government (BJP-led):** As the formulator of new schemes and the primary funder, it determines the fiscal architecture of welfare programs. It faces criticism regarding its allocation policies and perceived political use of national symbols.

2. **State Governments:** These are crucial implementers of most welfare schemes. A 40% funding burden can significantly strain their already stretched financial resources, especially for states with lower revenue bases. This directly impacts their fiscal autonomy and capacity to fund other state-specific initiatives.

3. **Opposition Parties (e.g., Congress):** They play a vital role in scrutinizing government policies, highlighting potential financial burdens on states, and holding the ruling party accountable for its decisions and political messaging.

4. **Rural Beneficiaries:** Ultimately, the effectiveness and reach of these schemes directly impact the rural populace, who rely on such programs for employment and livelihood support.

**Why This Matters for India: Fiscal Federalism and Welfare Delivery**

This issue cuts to the heart of India's fiscal federalism – the division of financial powers and responsibilities between the Centre and states. The 14th Finance Commission (2015-2020) recommended increasing the states' share in the divisible pool of central taxes from 32% to 42%, giving states more untied funds. However, concurrently, there was an expectation that the Centre might reduce its share in Centrally Sponsored Schemes, shifting more financial responsibility to states. The 15th Finance Commission (2020-2025) largely retained this enhanced devolution. A scheme like VB-G RAM G, with a 60:40 funding model, aligns with this trend, placing a greater obligation on state budgets.

This shift can have several implications: it could strain state finances, potentially leading to delays in fund release, under-implementation, or even reluctance by states to adopt such schemes fully. It also highlights the constant negotiation between the Centre and states over resource allocation and policy priorities. Politically, it allows opposition parties to frame the issue as the Centre offloading its responsibilities onto states, particularly when the states are governed by different political parties.

**Historical Context and Constitutional Provisions**

Discussions around Centre-State financial relations are not new. The Indian Constitution, particularly the **Seventh Schedule (Article 246)**, delineates legislative powers into Union, State, and Concurrent Lists, influencing financial responsibilities. While rural development and employment often appear in the State or Concurrent List, the Centre has historically played a significant role through schemes. **Article 280** establishes the Finance Commission, which periodically reviews Centre-State financial relations and makes recommendations on the distribution of taxes and grants-in-aid. The recommendations of the 14th and 15th Finance Commissions are highly relevant here, as they impacted the fiscal space of both the Centre and states.

**Future Implications**

This pattern suggests a potential trend where new welfare schemes might increasingly adopt a cost-sharing model, pushing states to contribute more. This could intensify debates on fiscal federalism, forcing states to prioritize their spending and potentially leading to uneven implementation across the country, depending on a state's financial health and political willingness. It also underscores the need for robust state revenue generation and efficient financial management. The political dimension will likely continue, with opposition parties using funding patterns to critique government policies, especially in the run-up to elections, making Centre-State financial dynamics a recurring theme in India's political economy.

In essence, the debate around VB-G RAM G's funding model is a microcosm of larger issues concerning India's federal structure, economic policy, and the political economy of welfare.