VB-G RAM G rules: What changes as the new job scheme replaces MGNREGS from July 1

📌 Summary:

• Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025 — known as VB-G RAM G — will come into force from July 1, 2026, replacing the two-decade-old MGNREGA enacted in 2005

• MoRD released 8 draft rules on May 23, 2026 covering wage payment, unemployment allowances, allocations to states and implementation monitoring; public objections/suggestions invited within one month

• Three structural changes from MGNREGS: (1) Guaranteed wage employment days raised from 100 to 125 per year, with a 60-day pause during peak agricultural sowing/harvesting seasons to ensure farm-labour availability (2) Funding model: states must now bear 40% of the wage bill (vs Centre's 100% under MGNREGS). Exceptions — Centre will bear 90% for northeastern + Himalayan states and UTs with legislatures; 100% for UTs without legislatures (3) Allocation flipped from bottom-up (state labour budgets) to top-down — Centre will determine devolutions to states

• Transitional Provisions: existing MGNREGS job cards remain valid for VB-G RAM G work once renewed and verified through e-KYC, until states issue Gramin Rozgar Guarantee Cards under the new law

• All wage and unemployment-allowance payments will be made through Direct Benefit Transfer to bank/post office accounts; Centre yet to announce the new wage rate

• Central outlay: Rs 95,692.31 crore for VB-G RAM G in FY 2026-27

• Normative allocation will use the Sixteenth Finance Commission's horizontal devolution formula — Tamil Nadu, Andhra Pradesh, Rajasthan and Maharashtra likely to get lower allocations; UP, Gujarat, MP, Assam, Haryana, Punjab, Bihar likely to gain

• "Performance-linked top-up": a portion of the normative allocation will be kept aside and distributed based on (a) timely payment of wages (b) compliance with social-audit norms (c) percentage of works completed (d) other parameters — effective from FY 2027-28

• Crucial fiscal-federalism implication: states bear all expenditure above the normative allocation

🎯 UPSC Relevance: GS2 — Government policies and welfare schemes (rural employment guarantee redesign); GS3 — Indian Economy (employment, fiscal federalism, transfers to states), Agriculture (60-day pause for farm labour); GS2 — Federalism (Centre-state finance).

📝 Prelims Facts:

• VB-G RAM G Act, 2025 enacted in December 2024-Dec 2025 (parliament passed in Dec last year per article)
• Guaranteed days: 125 (vs MGNREGS's 100)
• 60-day operational pause for sowing/harvest
• Centre-state cost share: 60:40 (general states); 90:10 (NE + Himalayan + UTs with legislature); 100% (UTs without legislature)
• VB-G RAM G outlay FY 2026-27: Rs 95,692.31 crore
• Allocation formula: Sixteenth Finance Commission horizontal devolution
• MGNREGS in FY 2025-26 provided work to over 5 crore rural families

🔑 Key Term: Normative Allocation — a centrally determined fund quantum for each state based on objective parameters (rather than state-generated labour budgets), making rural employment funding top-down for the first time since 2005.