VB-G RAM G Bill, 2025: Replacement of MGNREGA

Context

The Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, 2025 has been introduced to replace the MGNREGA, 2005, which has been India’s main rural employment guarantee law for nearly two decades. The Bill proposes major changes in employment days, funding pattern, planning, and monitoring, and has triggered debate on its impact on States, rural workers, and federalism.

What is the VB-G RAM G Bill, 2025?

1. The VB-G RAM G Bill is a new statutory framework for rural employment and livelihood creation.
2. It replaces MGNREGA, 2005, which guaranteed at least 100 days of wage employment to rural households.
3. The Bill seeks to combine employment generation, livelihood creation, and rural infrastructure development under a single, technology-driven mission.
4. It introduces fixed employment guarantees, normative funding limits, seasonal pauses, and digital monitoring.

Key Statutory Changes Proposed

1. Expansion of Guaranteed Employment Days
   1. Employment guarantee increased to 125 days per rural household per year.
   2. Under MGNREGA, 100 days became a practical ceiling despite legal flexibility.
   3. Earlier exceptions like extra days in drought areas or for forest-dwelling STs are now replaced by a uniform statutory entitlement.
2. Change in Centre-State Funding Pattern
   1. Unlike MGNREGA, where the Centre paid 100% unskilled wage costs, the new Bill shifts costs to States.
   2. Proposed sharing:
      1. 90:10 for Northeastern, Himalayan States and UTs with legislature
      2. 60:40 for other States

• 100% Centre-funded for UTs without legislature

1. This significantly increases State fiscal responsibility.

3. Normative Allocation Replacing Labour Budget
   1. The Centre will decide State-wise fixed allocations every year.
   2. Any spending beyond this limit must be borne by the State.
   3. This replaces the demand-driven labour budget system of MGNREGA.
   4. The scheme thus shifts from rights-based and demand-led to budget-capped and supply-driven.
4. Statutory Pause During Peak Agricultural Seasons
   1. Public works will be legally paused for up to 60 days during sowing and harvesting seasons.
   2. States must notify these periods based on local cropping patterns.
   3. While this helps agriculture, it reduces the effective window to realise the 125-day guarantee.
5. Viksit Gram Panchayat Plans & National Infrastructure Stack
   1. All works must originate from Viksit Gram Panchayat Plans and move upward to the national level.
   2. These plans feed into the Viksit Bharat National Rural Infrastructure Stack, covering:
      1. Water security
      2. Core rural infrastructure

• Livelihood infrastructure

1. Climate and extreme weather mitigation

1. Integration with PM Gati Shakti National Master Plan enables spatial and inter-departmental convergence.

Why the Overhaul of MGNREGA Was Proposed?

1. MGNREGA, enacted in 2005, is seen as misaligned with current rural realities.
2. Issues highlighted by the government include:
   193. Misuse of funds (₹193.67 crore in FY 2024-25)
   194. Weak monitoring and delayed payments
   195. Creation of low-quality assets
   196. Only 61% households completed 100 days of work
3. The new Bill aims to create a more accountable, efficient, and infrastructure-focused system using technology.

How the VB-G RAM G Framework Works

1. Employment and asset creation are planned digitally through Panchayat-led plans.
2. Funding is pre-allocated through norms, not open-ended demand.
3. Works are paused during peak agricultural seasons to support farming.
4. Payments, monitoring, and verification are digitised and Aadhaar-linked.
5. National-level infrastructure planning is aligned with climate resilience and productivity goals.

Implications of the Bill

1. Rural employment becomes more structured and predictable, but less demand-driven.
2. States face higher fiscal and administrative burden.
3. Focus shifts from short-term relief to long-term infrastructure and productivity.
4. Farmers may benefit from better labour availability during peak seasons.
5. Workers gain more guaranteed days, but with stricter conditions and timelines.
6. Federal balance may be affected due to centralised planning and capped allocations.

Challenges and Way Forward

Conclusion

The VB-G RAM G Bill marks a decisive shift from a demand-driven welfare model to a planned, infrastructure-led employment framework. Its success will depend on balancing efficiency with inclusiveness, and central coordination with State capacity.