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 — VB-G RAM G — comes into force on July 1, 2026, replacing 2-decade-old MGNREGA (which served 5+ crore rural families in 2025-26)
• Ministry of Rural Development released 8 draft rules on May 23, 2026; public objections invited for one month
• Key changes from MGNREGS: (1) Guaranteed work days: 100 → 125 (2) New 60-day pause during peak agricultural sowing/harvesting seasons (to ensure farm labour availability) (3) Funding: Centre paid 100% of wages under MGNREGS → now 40% burden shifts to states (exceptions: northeastern & Himalayan states + UTs with legislature get 90% Central funding; UTs without legislature get 100%) (4) Allocation flow flips: MGNREGS = Centre allocation based on state labour budgets → VB-G RAM G = top-down normative allocation by Centre
• Allocation parameters: Centre uses 16th Finance Commission's horizontal devolution formula. Likely losers: Tamil Nadu, Andhra Pradesh, Rajasthan, Maharashtra. Likely gainers: UP, Gujarat, MP, Assam, Haryana, Punjab, Bihar
• Performance-linked allocation (from next FY): portion of normative allocation withheld and distributed based on (a) timely wage payment (b) social audit compliance (c) % work completion (d) other performance indicators
• Excess expenditure rule: state bears any costs above its normative allocation — major financial risk for states with high demand
• Transitional provision (new in rules, not in Act): existing MGNREGS job cards remain valid (after renewal + e-KYC) until states issue new Gramin Rozgar Guarantee Cards
• All wage and unemployment allowance payments via DBT to bank/post office accounts
• VB-G RAM G allocation for FY 2026-27: Rs 95,692.31 crore
• Wage rate under new scheme: not yet declared

🎯 UPSC Relevance: GS2 — Government schemes, federalism (Centre-state burden sharing), governance. GS3 — Inclusive growth, employment, fiscal federalism, 16th Finance Commission impact.

📝 Prelims Facts:

• Full name: Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025
• Replaces MGNREGA (enacted 2005)
• Effective from July 1, 2026
• Work days: 100 → 125; 60-day seasonal pause
• FY26-27 allocation: Rs 95,692.31 crore
• Centre-state funding split: 60-40 (general); 90-10 (NE/Himalayan/UTs with legislature)
• 16th Finance Commission's horizontal devolution formula used for state allocation

🔑 Key Term: Normative Allocation — Top-down fund distribution where Centre determines each state's share based on objective parameters (here, 16th FC horizontal devolution + performance indicators), as opposed to demand-driven allocation based on actual state labour budgets.