The Parliament passed a significant legislation on December 18-19, 2025, that will fundamentally reshape rural employment in India. The Viksit Bharat—Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, or VB-G RAM G Bill, replaces the two-decade-old MGNREGA with a new framework. Here's what it means for millions of rural households.
What is the VB-G RAM G Bill?
The Viksit Bharat—Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, 2025, introduced in Lok Sabha on December 16, seeks to replace the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) of 2005. The legislation aims to align rural employment with India's vision of Viksit Bharat 2047—a developed India by 2047.
The bill was passed amid intense opposition protests, with members staging walkouts and dharna demonstrations outside Parliament. Despite the controversy, the legislation cleared both Houses and awaits Presidential assent to become law.
Key Changes from MGNREGA
1. More Guaranteed Work Days
The new law increases guaranteed employment from 100 days to 125 days per rural household annually. This represents a 25% expansion in employment opportunities for rural families seeking unskilled manual work.
Under MGNREGA, while the law mandated "not less than 100 days," the 100-day limit became a de facto ceiling in practice. The additional days were granted only during droughts, disasters, or for specific tribal communities in forest areas. The VB-G RAM G Bill makes 125 days the standard statutory entitlement rather than an exception.
However, critics point out that most households never reach even 100 days under the current system. In 2024-25, the average employment per household was around 50 days, with only 40.7 lakh households completing 100 days.
2. Changed Funding Structure
Perhaps the most controversial aspect of the new bill is the shift in how costs are shared between the Centre and states.
Under MGNREGA: The Central government bore 100% of unskilled wage costs, along with 75% of material costs and a share of administrative expenses.
Under VB-G RAM G Bill: A new cost-sharing pattern has been introduced:
- 60:40 split for most states (Centre:State)
- 90:10 split for North-Eastern and Himalayan states, including Uttarakhand, Himachal Pradesh, and Jammu & Kashmir
- 100% Central funding continues only for Union Territories without legislatures
This shifts direct wage liability to states, substantially increasing their fiscal responsibility. States will share costs for wages, material expenses, and administrative costs in these ratios, while continuing to pay unemployment allowances and compensation for delayed payments.
3. Budget Cap Through 'Normative Allocation'
The bill introduces a fundamental change in how funds are allocated. Under MGNREGA, funding was demand-driven and open-ended—the Centre had to provide supplementary funds if actual demand exceeded projections due to factors like monsoon failure or economic distress.
The VB-G RAM G Bill empowers the Central Government to determine state-wise normative allocation based on prescribed objective parameters. Any expenditure beyond this allocation must be borne entirely by the state government.
This effectively converts the rights-based, demand-led scheme into a budget-capped, supply-driven programme. Critics argue this fundamentally weakens the legal claim to work—if funds run out, employment may be denied.
4. Mandatory Agricultural Pause
The bill introduces a 60-day "agricultural pause" during peak sowing and harvesting seasons when works under the scheme will not be undertaken. State governments must announce these periods in advance, and can tailor notifications to districts, blocks, or agro-climatic zones based on local cropping patterns.
This provision addresses farmers' longstanding complaint that MGNREGA creates labour shortages during critical farming periods. However, critics warn it could hurt landless labourers who depend on the scheme for survival, particularly when private farm work might not be available or pays poorly.
5. Focus on Asset Creation and Infrastructure
The bill shifts emphasis toward creating high-quality, durable assets aligned with national priorities. Works will focus on four thematic domains: water security, rural infrastructure, livelihood-related infrastructure, and mitigation of extreme weather events.
All works undertaken will be aggregated into the Viksit Bharat National Rural Infrastructure Stack and integrated with the PM Gati Shakti National Master Plan. This represents a move from decentralised, gram panchayat-led planning toward greater central coordination.
6. Technology Integration
The bill mandates comprehensive digital infrastructure:
- Biometric authentication for attendance
- Geospatial technology for planning and monitoring
- GPS tracking of worksites
- AI-based fraud detection
- Mobile application-based dashboards for real-time tracking
- Weekly public disclosure systems
- Mandatory social audits at least twice annually
The administrative expenditure ceiling has been raised from 6% to 9%, allowing greater investment in staffing, training, and technical capacity.
Why the Name Change?
The removal of "Mahatma Gandhi" from the act's name has become a major point of political contention. The government positions the renaming as aligning with the "Viksit Bharat 2047" vision, while opposition parties have staged protests, calling it politically motivated and disrespectful to Gandhi's legacy.
The new name incorporates "G RAM G," which phonetically echoes "Ram," introducing Hindu iconography into the legislation—a move opposition parties view as part of the ruling party's ideological positioning.
Government's Rationale
The government argues that rural India has transformed significantly since MGNREGA was enacted in 2005, necessitating a modernised framework. Key justifications include:
- Asset Quality Concerns: MGNREGA has been criticized for creating non-durable or low-utility assets. The new bill prioritizes productive assets.
- Labour Supply for Agriculture: The agricultural pause provision ensures farmers have access to labour during critical seasons.
- Fiscal Discipline: Moving from open-ended funding to normative allocation helps better manage fiscal outlays.
- Transparency: Enhanced digital monitoring aims to curb leakages and corruption.
The government positions the bill as part of a broader transformation of rural India, citing sharp declines in poverty levels, rising incomes, and diversified livelihoods.
Major Criticisms and Concerns
1. Dilution of Rights-Based Framework
Critics argue that shifting from a justiciable right to a schematic entitlement with a budget cap fundamentally weakens the legal claim to work. The original MGNREGA was landmark legislation because it gave the guarantee the sanctity and legal force of a right to demand work.
2. Fiscal Burden on States
The shift to a 60:40 funding split places a massive financial burden on poorer states like Bihar or Uttar Pradesh that have high demand for work but low revenue capacity. Economist Jean Drèze warns that states will be forced either to suppress demand for work or fund the entire programme themselves, which is simply not feasible.
3. Centralization of Power
The normative allocation model allows the Centre to determine funding limits, reducing the autonomy of states to plan based on local demand. This has raised concerns about federalism and whether the mechanism could be used to punish opposition-ruled states by denying or delaying allocations.
4. Impact on Vulnerable Workers
The 60-day seasonal pause might hurt landless labourers who rely on the scheme for survival. Women, Dalits, and tribal communities—who form the bulk of MGNREGA workers—could face reduced employment opportunities.
5. Hasty Passage Without Scrutiny
The bill was passed after just eight hours of parliamentary debate, with requests to send it to the Standing Committee for scrutiny being turned down. The Chairperson of the Standing Committee on Rural Development expressed "deep concern and institutional discomfort" at the bill being processed without committee examination.
Real-World Implications
For Workers
Potential Benefits:
- Higher statutory guarantee of 125 days of work
- Weekly wage payments (faster than the 15-day cycle under MGNREGA)
- Better quality assets that could provide long-term community benefits
Potential Challenges:
- 60-day pause may reduce actual working days to 65 days
- Budget caps might mean employment is denied when funds run out
- Digital requirements could exclude illiterate or digitally unconnected workers
For States
Wealthy States: Better positioned to absorb the 40% cost sharing but may still struggle during years of high demand.
Poor States: Face severe financial stress. States with limited tax revenues but high rural poverty and greater need for employment guarantee will be hardest hit.
Opposition-Ruled States: Concerns about whether normative allocations will be fair or politically motivated.
For Rural Economy
The shift from welfare-centric employment to infrastructure-linked work aims to reposition rural employment as a development tool rather than just a safety net. Success will depend on:
- Whether the promised 125 days actually translate to increased employment
- Quality and durability of assets created
- Effective implementation of technology without exclusion
- Fair allocation of funds across states
What Happens Next?
The bill has been passed by both Houses of Parliament and awaits Presidential assent to become law. Once notified, states have six months to prepare and notify their own schemes consistent with the bill's provisions.
Protests continue, with the NREGA Sangharsh Morcha and opposition parties staging demonstrations and demanding the bill's withdrawal. Legal challenges in courts are also expected, particularly around the dilution of rights-based guarantees.
The Bottom Line
The VB-G RAM G Bill 2025 represents a fundamental restructuring of India's rural employment framework. While it promises more guaranteed work days and better asset creation, the shift from a demand-driven, rights-based programme to a budget-capped, centrally coordinated scheme has raised serious concerns about whether it will truly strengthen rural livelihoods or undermine them.
The implementation and the actual experience of rural households over the coming years will determine whether this legislative overhaul achieves its stated vision of rural transformation or becomes yet another administrative burden that fails to reach those who need it most.
This article synthesizes information from parliamentary documents, expert analyses, and recent reporting to explain the key aspects and implications of the VB-G RAM G Bill 2025.
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