Name changer or game changer? MGNREGA replaced with 125-day promise

President Murmu clears the Viksit Bharat Rozgar Act, raising guaranteed rural workdays to 125 and overhauling funding norms, seasonality rules, and budget limits

President Droupadi Murmu on Sunday gave her assent to the Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-G RAM G) Bill, which replaces the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) by raising guaranteed workdays from 100 to 125 per year.  With the presidential assent, it now becomes the VB-G RAM G Act, 2025. Under  MGNREGA, only 7.04 per cent of households completed the 100-day promise in FY25. The new Act shifts to a supply-driven framework with budget caps, alters the Centre-state funding ratio from between 71:29 and 96:4 to 60:40, with exceptions in some states, and mandates a 60-day work pause for peak sowing and harvesting seasons. 

The rural job scheme saw many tweaks in its 20-year journey, including its renaming from NREGA to MNREGA. (Chart 1) 

 

Seven states accounted for over 60 per cent of Centre fund allocation between FY23 and FY25. Uttar Pradesh and Andhra Pradesh led, while Tamil Nadu’s share dropped from 14.21 per cent in FY24 to 8.89 per cent in FY25. (Chart 2) 

 

Among the top seven states receiving central funds, five maintained ratios below 90:10 in FY25. Tamil Nadu and Bihar bore the highest fiscal burden. (Chart 3) 

 

Mizoram is the only state to consistently maintain over 90 days of work per household, reaching 94.62 days in FY25. The national average remained around 50 days. (Chart 4) Households completing 100 days dropped from 9.53 per cent in FY20 to 7.04 per cent in FY25. (Chart 5) 

 

 

Work demand peaks during April-June, particularly in June, following the rabi harvest. (Chart 6)