3 min readNew DelhiUpdated: May 11, 2026 12:53 PM IST
The Viksit Bharat—Guarantee for Rozgar and Ajeevika Mission (Gramin): VB—G RAM G Act 2025, which aims to repeal the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) 2005 and provides for a new rural job guarantee programme, will become effective on July 1, 2026.
The Union Ministry of Rural Development issued a notification to this effect on Monday. The more than two-decade-old MGNREGA, enacted by the UPA government, will thus cease to exist from July 1.
“In exercise of the powers conferred by sub-section (1) of section 37 of the Viksit Bharat—Guarantee for Rozgar and Ajeevika Mission (Gramin): VB—G RAM G…Act, 2025 (36 of 2025), the Central Government hereby appoints the 1st day of July, 2026 as the date on and from which the Mahatma Gandhi National Rural Employment Guarantee Act, 2005 (42 of 2005) together with all rules, notifications, schemes, orders and guidelines made thereunder, shall stand repealed,” states a notification issued by Rohini R Bhajibhakare, Joint Secretary, Ministry of Rural Development.
The government enacted the VB-G RAM G Act 2025 in December last year. VB G RAM G aims to provide a statutory guarantee of 125 days of wage employment in every financial year to every rural household whose adult members volunteer for unskilled manual work, with the “objective to promote empowerment, growth, convergence and saturation for a prosperous and resilient rural Bharat”.
Unlike the MGNREGS, where the Centre paid 100 per cent of the wage bill, VB G RAM G is a centrally sponsored scheme with a fund-sharing ratio of 60-40 between the Centre and states for all states, 90-10 for Northeast states, Himalayan states, and Union Territories with a legislature, and 100 per cent central share for UTs without a legislature.
The Opposition has criticised several provisions of the VB-G RAM G Act such as the fund sharing pattern (section 22), normative allocation (sub-section 5 of section 4), and a pause in employment guarantee during the peak agriculture season (section 6). These provisions will also have a fiscal implication for states, which are already facing challenges.
Departing from the MGNREGA, the VB-G RAM G Act proposes a higher share of states in funding the rural job programme. As per section 22(1) of the Act, the fund-sharing pattern between the central government and the state governments shall be 90:10 for the 11 states, while it will be 60:40 for all other states. Under the MGNREGA, the Centre paid the entire wage bill and shared 75 per cent of the material and administrative costs of the scheme.
