The VB-G RAM G Act came into effect on Wednesday, although several states have neither notified the new rural job scheme nor allocated a budget for it.
Five states, including BJP-ruled Madhya Pradesh and Uttarakhand, have opposed the increased funds burden on states under the new law that provides for 125 days of work to every rural family in a year.
The Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) has replaced the two-decade-old Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) that provided 100 days of work per family.
Under the MGNREGA, the ministry of rural development (MoRD) used to bear the entire wage expense while the material cost was shared in a 75:25 ratio between the Centre and the states. The overall share of states under the MGNREGA remained below 10 per cent of total expenditure.
However, under the new law, states have to shoulder 40 per cent of the total expense.
According to documents obtained under the RTI Act by Chakradhar Buddha from the National Campaign for People’s Right to Information, representatives from Madhya Pradesh, Bihar, Jharkhand, Uttarakhand and Telangana had opposed the enhanced funds burden at a meeting with the Centre in April.
According to a media release issued by the MoRD on Tuesday, 29 states and Union Territories have made budgetary provisions for VB-G RAM G, while 24 states have notified the scheme.
According to the MoRD notification, the per-day wage rates for 2026-27 range between ₹300 (in Bengal, Bihar, Jammu and Kashmir and 19 other states) and ₹409 (in Haryana).
Though the new wage rates are higher than the MGNREGA rates of 2025-26, they are still less than what some states and UTs had demanded in their April meeting. According to the official document, Bihar had demanded a wage hike from ₹255 to ₹413 while Jammu and Kashmir had sought a raise from ₹272 to ₹311.
The MoRD had notified the draft rules on VB-G RAM G in May. They are yet to be finalised.
Buddha said the implementation of the new scheme would face practical difficulties on the ground in the absence of notification, rules and allocated budgets in several states.
“The law says the Centre will fix normative allocations for states and each state will bear 40 per cent of that amount. The MoRD only last month decided the normative allocations for states. That is why several states, including Karnataka, have not earmarked funds in their budget for VB-G RAM G. So the implementation of the job scheme will be erratic,” Buddha said.
He said rules provide clarity on the provisions of the law and help in its implementation. Since the MoRD and several states have not notified their rules, workers seeking employment under the scheme will face uncertainty.
Social activist Nikhil Dey said the job guarantee under the new scheme looked good on paper.
“The 40 per cent funds burden for states is huge given the financial constraints faced by them. The allocation by the Centre is ₹95,000 crore, almost the same as that earmarked under the MGNREGA. Families were getting about 50 days of work under the MGNREGA when the eligibility was for 100 days. How will the families get 125 days of work now?” he asked.
The new law also requires states to bear any expenditure that exceeds their allocated normative budget.
“The guarantee of 125 days of work is no guarantee since there is no adequate funds provision,” Dey said.
He said the new wage rates were less than the minimum wage rates in many states.
“The wage under any scheme should not be less than the minimum wage. But it is less than the minimum wage in several states. This is a denial of the minimum standard of living for workers,” Dey said.
Congress leader Jairam Ramesh posted on X that the wages were “unjustifiably low”.
He cited the recommendation of an expert committee headed by Anoop Satpathy in 2018 that a national minimum wage floor should be at ₹375 per day at the July 2018 price index.
“Given the widespread minimum wage protests in industrial hubs such as Noida, and at a time when the stagnation of rural wages is widely recognised as a key constraint on our economic growth, this notification is both a snub to India’s workers and unwise economic policy,” Ramesh posted.
Several worker organisations under the banner of the NREGA Sangharsh Morcha on Wednesday protested the rollout of VB-G RAM G over concerns about increased burden for states, low fund allocations and low wage rates.