Explained: Why govt wants to replace MGNREGA with VB-G RAM G after 20 years

The draft VB-G RAM G Bill, 2025 seeks to replace MNREGA to offer 125 days of rural work, focus on durable assets, improve transparency, and align employment schemes with rural economy and needs

The Union government has proposed a series of major changes to the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), including the renaming of the scheme. The plan aims to raise the guaranteed number of workdays from 100 to 125 and revise the existing funding model by transferring part of the financial burden to state governments.

 

Ahead of the tabling of the Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, or VB-G RaM G Bill in Parliament, the government released some frequently asked questions (FAQs) regarding the draft.

 

1. What is the proposed VB-G RaM G Bill?

 

The Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (Gramin), or the VB–G RAM G, seeks to replaces the nearly 20-year-old MNREGA framework.

 

The draft Bill guarantees 125 days of wage work each year to every rural household whose adult members are willing to do unskilled manual labour.

 

The draft Bill links job creation with long-term rural development through four priority areas:

 

• Water security through water-related works

• Core rural infrastructure

• Livelihood-related infrastructure

• Special works to reduce the impact of extreme weather

 

All assets created under the scheme are mapped into the Viksit Bharat National Rural Infrastructure Stack, helping ensure coordinated and planned national development.

 

2. How is VB-G RaM G different from MGNREGA?

 

Key changes include:

 

• Higher employment guarantee: Workdays rise from 100 to 125, giving families greater income security.

• Clear infrastructure priorities: Unlike MGNREGA’s scattered work categories, VB-G RaM G concentrates on four well-defined sectors, ensuring durable assets that support water security, rural infrastructure, livelihoods and climate adaptation.

 

3. How will the new scheme benefit India's rural economy?

 

VB-G RaM G seeks to support the rural economy in several ways:

 

• Water security: Water works are prioritised.

• Core infrastructure: Better roads and connectivity improve market access and rural business activity.

• Livelihood assets: Storage facilities, markets and production infrastructure help diversify incomes.

• Climate resilience: Flood control, soil conservation and water harvesting protect livelihoods.

• Higher incomes and spending: 125 guaranteed days raise earnings and boost local demand.

• Lower distress migration: More local jobs reduce the need to migrate.

• Digital systems: Digital attendance, payments and planning improve efficiency and control leakages.

 

4. How will the new scheme benefit farmers?

 

Farmers will gain from better infrastructure and smoother labour availability:

 

• Assured labour during sowing and harvest: States can notify up to 60 days when public works stop, ensuring labour is available for farms during peak periods.

• Control on wage inflation: Pausing public works during peak seasons avoids artificial wage spikes that raise farming costs.

• Improved irrigation: Water assets strengthen irrigation and allow multi-season cropping, backed by the over 68,000 Amrit Sarovar water bodies.

• Better storage and access: Roads, storage and market facilities reduce losses and improve market reach.

• Climate protection: Flood drainage, soil conservation and water harvesting reduce crop damage.

 

5. How will the new scheme benefit labourers?

 

Labourers stand to gain from stronger guarantees and systems:

 

• Higher earnings: 125 days of work means about 25 per cent more income potential.

• Predictable jobs: Local Viksit Gram Panchayat Plans map work in advance.

• Secure payments: Electronic wage payments (already 99.94 per cent in 2024-25) continue with biometric and Aadhaar verification, cutting wage theft.

• Unemployment allowance: If work is not provided, states must pay compensation.

• Shared benefits: Workers also use the roads, water and livelihood assets they help create.

 

6. Why is there a need to change MGNREGA?

 

According to the government release, MGNREGA was designed for 2005, but rural conditions are very different today. Poverty declined from 25.7 per cent (2011-12) to 4.86 per cent (2023-24), supported by higher incomes, consumption and financial access, as seen in MPCE and NABARD RECSS surveys. Better connectivity, digital access and social protection reduced the relevance of an open-ended model.

 

The VB–G RAM G seeks to update the system by raising guaranteed days, refocusing priorities and creating a more targeted and accountable framework, the government release says.

 

7. What is the need to shift from demand-based to normative funding?

 

• Normative funding follows the budgeting approach used for most government schemes.

• It avoids unpredictable allocations seen under demand-based funding.

• Objective parameters allow better planning while still guaranteeing work or unemployment allowance for every eligible worker.

 

8. Does normative funding weaken the guarantee of 125 days?

 

No, the guarantee is stronger.

• Employment days rise to 125.

• Forecasting accuracy was proven in FY 2024-25, when allocation matched demand

• Both the Centre and states share responsibility

• Special relaxations apply during disasters

• If work is denied, unemployment allowance is compulsory

 

The legal right to employment remains protected.

 

9. Were no attempts made to improve MGNREGA earlier?

 

Important improvements were made between FY 2013-14 and FY 2025-26:

• Women’s participation: 48 per cent to 56.74 per cent

• Aadhaar-seeded workers: 7.6 million to 121.1 million

• Workers on APBS: 0 to 119.3 million

• Geo-tagged assets: 0 to 64.4 million

• E-payments: 37 per cent to 99.99 per cent

• Individual assets: 17.6 per cent to 62.96 per cent

 

10. What were the problems with MGNREGA that necessitated a change?

 

Despite reforms, the government says some serious issues remained:

• In 19 districts of West Bengal, probes found fake works, rule violations and fund misuse, leading to a freeze.

• Monitoring in 23 states (FY 2025-26) found missing or substandard works, machine use instead of labour, and large-scale bypassing of NMMS attendance.

• In 2024-25, misappropriation reached ₹193.67 crore

• Only 7.61 per cent of households completed 100 days after the pandemic.

 

11. What transparency and social protection measures are built into the new Bill?

 

Key safeguards include:

• AI-based fraud detection

• Central and state steering committees

• Focus on four priority sectors

• Greater monitoring role for Panchayats

• GPS and mobile-based tracking

• Real-time MIS dashboards

• Weekly public disclosures

• Social audits twice a year for every Gram Panchayat

 

12. Why shift from a central sector to a centrally sponsored scheme?

 

• Rural employment needs local planning.

• States now share costs and accountability.

• Gram Panchayat Plans reflect regional needs.

• The Centre sets standards, while states implement them.

 

13. Will this burden states financially?

 

No, the cost-sharing is balanced

• 60:40 Centre-state for most states

• 90:10 for North-eastern and Himalayan states/UTs

• 100 per cent central funding for UTs without legislatures

• States already bore material and administrative costs earlier

• Predictable funding helps budgeting

• Extra support is available during disasters

• Better oversight cuts long-term losses

 

14. Why is a 60-day no-work period mandated?

 

• It ensures labour availability during sowing and harvest.

• Prevents sharp wage inflation that can raise food prices.

• Workers naturally move to farm jobs, which pay higher seasonal wages.

• The 60 days are aggregated, not continuous

• Workers still receive 125 days of guaranteed work in the remaining year.