What You Need to Know About India's New VB-G RAM G Act: A Shift in Rural Employment

Introduction to the VB-G RAM G Act

New Delhi: On Monday, the Indian government revealed that the Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin), abbreviated as VB-G RAM G Act, 2025, will be implemented nationwide starting July 1, replacing the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).

The administration has described this new legislation as a "next-generation rural development framework" that aligns with the Viksit Bharat 2047 vision. It promises to increase guaranteed wage employment from 100 days to 125 days annually, while also linking rural jobs more closely with infrastructure development, climate resilience, and local planning.

However, opposition parties and labor rights advocates have expressed concerns regarding the repeal of MGNREGA, arguing that the previous law had become a crucial rights-based social protection mechanism. They warn that the new measures, including increased digitization and face-authentication attendance, could pose challenges for vulnerable workers.

Key Changes Under the New Legislation

The VB-G RAM G Act guarantees 125 days of wage employment per financial year for every rural household with adult members willing to engage in unskilled manual labor, an increase from the previous 100 days under MGNREGA.

The government has outlined four primary categories of work under the new scheme: water security initiatives, essential rural infrastructure, livelihood-related projects, and efforts to mitigate extreme weather conditions.

In contrast, MGNREGA categorized work into broader areas such as water conservation, drought-proofing, irrigation, and flood control.

Additionally, the new law introduces "Viksit Gram Panchayat Plans" (VGPPs), which are local development plans created by Gram Panchayats and approved by Gram Sabhas, ensuring that all projects align with village-specific needs.

Transitioning from MGNREGA

The government has assured that the transition from MGNREGA to the VB-G RAM G Act will be "seamless and uninterrupted." MGNREGA will officially be repealed on July 1, 2026, coinciding with the implementation of the new Act.

Current MGNREGA projects will continue and be integrated into the new framework, with a focus on completing unfinished public assets. Existing job cards will remain valid temporarily for workers who have completed their e-KYC until new "Gramin Rozgar Guarantee Cards" are issued.

Moreover, new projects can commence during the transition if existing works do not meet labor demand.

What Stays the Same?

Employment must still be provided within 15 days of a request; otherwise, workers are entitled to an unemployment allowance from state governments.

Wages will continue to be disbursed through direct benefit transfers to bank or post office accounts, with payments made weekly or within two weeks after the muster roll closes.

The law also maintains provisions for compensation in cases of delayed wage payments.

New Administrative Features

Attendance at job sites will be recorded using a face authentication system, although exceptions will be made for connectivity issues or other legitimate challenges.

Another significant change is the restriction on work during peak agricultural seasons, which states will announce to prevent labor shortages during planting and harvesting.

Funding Mechanisms

The funding structure for states under this scheme will be 90:10 for northeastern and Himalayan states, 60:40 for other states and Union Territories with legislatures, and 100% central funding for Union Territories without legislatures.

Material costs at the district level are capped at 40%. Under MGNREGA, the Centre covered 100% of wages, while material costs were shared 75:25 between the Centre and states.

Government's Justification for the New Law

The government contends that this new framework modernizes rural employment by integrating livelihood support, infrastructure development, and climate resilience.

Officials assert that the law aims to transition from a "demand-driven wage program" to a convergence-based development model with enhanced village-level planning.

The inclusion of infrastructure projects aimed at mitigating extreme weather is also presented as a response to the growing climate vulnerabilities faced by rural communities.

The Centre emphasizes the increased employment guarantee of 125 days and the assurance of continuous work availability during the transition.

Concerns Raised by Critics

Opposition parties and rights activists have criticized the complete repeal of MGNREGA instead of enhancing the existing framework.

MGNREGA operates on a demand-driven basis, requiring the government to allocate additional funds when there is a demand for work. In contrast, the VB-G RAM G Bill provides for normative allocations to states, with any excess costs falling on state governments.

Some activists worry that mandatory face-authentication attendance could exclude workers in remote areas with poor digital connectivity or elderly individuals facing authentication issues.

Others argue that the focus on convergence and planning detracts from the scheme's original strength, which was its legal guarantee of immediate wage employment.

Concerns have also been raised that limiting work during peak agricultural seasons may reduce income opportunities for landless laborers.

Critics are demanding clarity on whether the enhanced 125-day guarantee will be supported by sufficient budget allocations, especially given the recurring issues of delayed wage payments and fund releases under MGNREGA.