Centre Notifies New Rural Employment Law VB–G RAM G To Replace MGNREGA From July 1, 2026

The Central government has notified July 1 as the date for the rollout of the Viksit Bharat – Guarantee for Rozgar and Ajeevika Mission (Gramin) Act 2025. From the same date, the Mahatma Gandhi National Rural Employment Guarantee Act, 2005, will stand repealed.

The new law introduces a revised framework for rural employment with expanded coverage and higher guaranteed workdays. The Reserve framework aims to ensure continuity of employment during the transition.

Key Features of the VB–G RAM G Act

Under the new framework, every rural household with adult members willing to undertake unskilled manual work will be entitled to 125 days of wage employment in a financial year. This represents an increase from the 100 days of guaranteed work provided under MGNREGA.

The entitlement is universal for eligible rural households and does not depend on prior programme participation. The ministry described the change as a structural shift in India’s rural employment architecture.

Implementation Structure and Cost Sharing

The VB–G RAM G Act will operate as a centrally sponsored scheme with defined cost‑sharing arrangements. The funding split will be 60:40 between the Centre and states, while north‑eastern and Himalayan states will follow a 90:10 pattern.

Union Territories without legislatures will receive 100% central funding for implementation. This structure mirrors existing fiscal arrangements while accommodating regional administrative capacities.

Transition From MGNREGA To the New Framework

The government has outlined measures to ensure a seamless transition from MGNREGA to the new programme. All ongoing works as of June 30 will continue under the new framework without disruption.

Existing e‑KYC verified MGNREGA job cards will remain valid until new Gramin Rozgar Guarantee Cards are issued. Around 91% of the nearly 12 crore active workers have completed e‑KYC verification so far.

Rules, State Readiness, And Budget Allocation

The process of drafting rules under the new Act is currently underway following consultations with states. The rules are expected to be placed in the public domain for consultation before final notification.

States have a statutory window of 6 months from commencement to align their schemes, though many are expected to complete this earlier. For the financial year 2026–27, the Centre has allocated ₹95,692.31 crore, the highest budgeted amount for a rural employment programme, with the total outlay expected to exceed ₹1.51 lakh crore, including state contributions.

Read More: India's Labour Framework Overhaul.

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Conclusion

The notification of the VB–G RAM G Act marks a significant policy transition in rural employment support. By increasing guaranteed workdays and maintaining employment continuity, the framework seeks to strengthen the rural labour safety net.

The structured transition plan aims to prevent disruption for existing beneficiaries. Budgetary commitments and shared fiscal responsibility form the foundation for nationwide implementation from July 1.

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