Rural jobs fall in VB-G RAM-G's first month, Centre cites sowing pause

July persondays fell sharply from MGNREGA levels, but the Centre cites sowing pauses, monsoon recovery and transition issues, while experts say one month is too early to judge

One month is a blip in the life of a multi-year government-funded scheme, more so if the said programme has replaced one of independent India’s most successful rural employment guarantee schemes.

 

Not surprisingly, given the attention that the Act that governs Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Grameen) (VB-G RAM-G) has attracted since it was passed late last year replacing the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), it was only natural that its performance even in its first month would be tracked closely.

 

VB-G RAM-G became operational nationwide on July 1, 2026, with most states quickly notifying the scheme.

 

Data sourced from its website till August 11, 2026 showed that in July 2026, around 7.96 persondays of work were generated, a stark 55 per cent reduction from that generated under MGNREGA in July 2025.

 

The data also showed that around 10 million households turned up to seek work under the new scheme, about 39 per cent fewer than under MGNREGA in July 2025.

 

Though the government has said that over 99 per cent of those who demanded work under VB-G RAM-G were provided employment and that the scheme has been implemented smoothly across the country with seamless transition from MGNREGA, the first month's numbers do not back up that claim.

 

The Congress party's General Secretary Jairam Ramesh in a media post on social media platform X commented that that the first month of the Modi government's VB-G RAM-G scheme had exposed the cost of replacing MGNREGA, claiming rural employment had fallen sharply in July compared with the corresponding month last year.

 

“The first month of the Modi Government’s VB-G RAM G is already exposing the cost of destroying MGNREGA. In July 2026, the first month since the new law was adopted, rural employment generation fell sharply compared to July 2025 when MGNREGA was in operation,” he said, adding that this is precisely what was predicted by his party and the rest of the Opposition when MGNREGA was replaced.

 

“MGNREGA gave rural workers a legal guarantee of employment and empowered Gram Panchayats to implement it. The spirit of MGNREGA was to free workers from dependence on the political whims of the Government of the day. The Modi Government has instead centralised the scheme, imposed a heavy financial burden on State governments, made access increasingly dependent on technology and biometric authentication, removed the guarantee of employment, and made it harder for workers to claim their rights. VB-G RAM G is simply ‘rozgar chori,’ Ramesh alleged in his post.

 

Regardless of the Opposition's questions, the question remains whether the first month numbers reflect the true picture of the scheme and whether states reluctant to implement the scheme due to what they see as a heavier financial burden.

 

The government claims the situation on the ground is otherwise on both counts.

 

Sources in the rural development ministry said that one big factor behind the seeming drop in persondays of work generated under VB-G RAM-G in July 2026 compared to MGNREGA an year ago is that as many as seven major states that included major labour-centric ones like Bihar, Gujarat and Odisha, along with Mizoram, Nagaland, Sikkim and Arunachal Pradesh have opted for the mandatory ‘sowing pause', during the month of July which has contributed in pulling down the national jobs-provided numbers.

 

Under the VB-G RAM-G Act, states have the option to pause work under the scheme for a maximum period of 60 days which can either be two continuous months or two months with a break in between. During this pause period no work is allowed to be undertaken under the scheme as labourers are engaged in farm field work.

 

Officials also claimed that six states - West Bengal, Telangana, Andhra Pradesh, Manipur, Mizoram and Ladakh - have generated higher persondays during July 2026 as compared to the corresponding period of July 2025. West Bengal, though, did not have MGNREGA in 2025.

 

“This also indicates that the implementation of the programme has been progressing well in several states, with variations across states depending upon local demand for employment, agricultural operations and implementation dynamics,” an official said.

 

He pointed out that there was no provision for an ‘Agriculture Pause Period’ under MGNREGA. As many as seven states have opted for this pause this year as permitted by the VB-G RAM-G Act, during which no works are being undertaken.

 

“Therefore, any comparison with the corresponding period of last year will naturally show lower figures due to this structural difference. At the same time, six states have generated higher person-days this July compared to July of last year. Hence, a direct year-on-year or month on month comparison between the two periods is not appropriate or statistically valid,” the official said.

 

Also, as some officials explained, July is the peak month for sowing in most parts of India as the monsoon reaches its peak. This year, it was all the more vital as the rains were almost 37 per cent deficient in June 2026 that pulled down acreage by close to 21 per cent as compared to the same period last year. Last year, unlike 2026, monsoon had set in early and almost all months got good rains and significant area was brought under kharif crops in June itself as rains were steady.

 

By the time July 2026 ended, the monsoon deficit had shrunk to just around 11 per cent nationally while the sowing deficit came down to less than 3 per cent as compared to July 2025, suggesting that sowing operations revived with the monsoon, an event which could have further contributed in keeping VB-G RAM-G demand low in July 2026 as compared to July 2025.

 

Then there is the allegation that several states are reluctant to implement the scheme due to fear to heightened financial burden on account of 60:40 funding nature of the programme. Under MGNREGA, the Centre bore almost 90 per cent of the total expenditure of the scheme, including material and labour wages.

 

On this, too, official stand is that historically, most of the major rural employment schemes in the country have operated on shared funding models between the Centre and the States. Further, almost all Centrally Sponsored Schemes (CSS) across sectors are currently being implemented on the 60:40 sharing model.

 

“The 60:40 pattern adopted under this Act is therefore consistent with the broader framework of Centrally Sponsored Schemes,” official sources said.

 

In the current financial year 2026-27 (for the period from July,1 2026 to March 31, 2027), a provision of ₹95,692.31 crores has been made for the Central share of the VB-G RAM-G scheme, among the largest allocation ever made for rural employment programme at the budget estimate (BE) stage in the country.

 

With the inclusion of the corresponding estimated State share, the total programme outlay is likely to exceed ₹1.51 trillion, which is expected to significantly accelerate rural transformation, large-scale employment generation and income enhancement in rural areas.

 

Accordingly, financial sanctions for various components amounting to ₹25,844.97 crore have already been issued to the states and union territories as the first instalment under the scheme.

 

“... all repeat all states and union territories have reported that budget provisions have been made towards their matching share accordingly and Overall, the funding pattern is designed to balance fiscal responsibility, state participation and national rural development priorities,” the government said.

 

Ministry sources pointed out that even many non-BJP ruled states such as Karnataka, Punjab, Tamil Nadu, Jharkhand, Telangana, and Kerala have allocated a portion of their budgets towards their 40 per cent share for VB-G RAM-G in FY27.

 

Experts said that the truth lies somewhere in between. In their reading, while the first month performance of VB-G RAM-G was disappointing compared to MGNREGA, it was because of both structural and practical reasons.

 

Chakradhar Buddha, senior researcher at LibTech India, told Business Standard that on the ground, everything that existed under NREGA is essentially being replicated. However, at the lower levels, among frontline officials, there seems to be a lot of confusion and anxiety, and that things are not moving as quickly as they should, he added.

 

He said the transition to the new MIS has also meant changes in the internal systems. Some reports have changed, logins have changed, and officials are still trying to get a sense of what exactly is happening.

 

“For workers, however, if you ask most of them, they have not even realised that a change has taken place. For them, everything remains more or less the same,” Buddha, who has also worked for the MGNREGA Sangharsh Morcha, said.

 

On the lower employment generation compared with MGNREGA year-on-year, Buddha said that it is too early to draw any conclusions about the scheme’s performance.

 

“People are still trying to figure things out. In states such as Karnataka and Telangana, for instance, there appears to be a lot of confusion, particularly because these are Congress-ruled states where the political leadership has taken a position against the VB-G RAM-G Act. But, at the bureaucratic level officials are responsible for providing employment and are bound by the directions of the Ministry of Rural Development. So, they have to implement the scheme,” he said.

 

He added that he personally feels one month is far too little time to assess the scheme and is quite surprised by the over-the-top responses compared to what he sees on the ground. Buddha cited an example of Telangana, where he came across a case where employment had already been generated. But when officials tried to process the payment, they realised that the system had changed. They were also concerned about delays and the compensation that might become payable.

 

So, they simply removed the entry from the muster roll and decided that they would rebook the employment the following month once they had a better understanding of the system.

 

“These are the kinds of teething problems we are seeing across multiple places. So, yes, I would say it is definitely too early to judge the performance of the scheme based on just one month of data,” Buddha said.