The Center has announced that the new Viksit Bharat — Guarantee for Rozgar and Ajeevika Mission (Gramin) Act (VB-G RAM G) will come into effect across the country from July 1, replacing MGNREGA. | Photo credit: The Hindu
As the Union government on Monday (May 11, 2026) sounded the last gasp on the Mahatma Gandhi National Rural Employment Guarantee Act, passed in 2005, it announced that from July 1, all “rules, notifications, schemes, orders and instructions” made under the Act will be withdrawn and Viksit Bharat – Guarantee Gáeev-Gaeev-B Rozgar and G RAM will enter into validity.
Union Rural Development Minister Shivraj Singh Chouhan expressed his belief that the move marks the dawn of “a new era in the lives of labourers”. He said the scheme would prove to be a milestone in fulfilling the pledge to build “developed villages” as the foundation for a “developed India”.
Consultation with States: Minister
He also noted that the process of creating rules for the new law is underway after consultations with the states. “During this transition phase, no worker is out of a job. Comprehensive measures have already been put in place to ensure this,” the minister said. Most states will have a maximum of six months to complete the necessary preparations, he added.
Enacted under the UPA-led Congress, MGNREGA was part of a package of welfare legislation that emerged from the National Advisory Committee. The new rural employment scheme modifies several MGNREGA frameworks, including its demand-based approach, which scales up the budget to match local demand.
Although the government issued a note answering frequently asked questions, it did not clarify crucial aspects, including the objective parameters and formula for deciding the normative budget that will determine how much each state will receive. Under MGNREGA, the Center paid 100% of the labor costs; under the new system, the expenditure will be shared between the center and the states in the ratio of 60:40 for most of the states.
The VB-G RAM G legislation was approved by parliament in December last year without pre-legislative consultations. After its approval, the government met weekly with state rural development departments to build the infrastructure needed for implementation.
The new system increases the statutory job guarantee from 100 to 125 days in each financial year.
On job cards
The government has clarified that existing job cards that are e-KYC verified will remain valid until the Gramin Rozgar guarantee cards are issued. As of May 7, 2026, 11.58 million registered workers (45.4%) and 0.95 million active workers (9.5%) are yet to complete e-KYC, according to a recent study by LibTech, a consortium of activists and academics. “Employees will not be denied employment merely because of pending e-KYC and mechanisms have been provided to facilitate completion of e-KYC, including at workplaces wherever required,” the government note said.
It also clarified that workers can continue to apply for jobs verbally, in writing through the existing Form-6 framework or through digital platforms. Provisions carried over from MGNREGA such as unemployment benefits in case of non-employment will continue. Attendance will continue to be monitored through the National Mobile Monitoring System, despite concerns about reliance on digital systems in areas with patchy internet coverage. The ongoing work under MGNREGA as on the commencement date can continue under the new Act. If the ongoing work is not enough to meet the demand, new work can be started in accordance with Annex I of the new law.
The legislation provides for power outage periods of up to 60 days to be notified to states, ostensibly to ensure the availability of agricultural labor during peak planting and harvesting periods. This clause drew criticism for reducing workers’ bargaining power.
Nothing new: Congress
Reacting to the announcement, Congress general secretary (communications) and former rural development minister Jairam Ramesh said the government’s statement “does not add anything new to what is already known”. “No details have been revealed except that they will be released soon. If this replacement for MGNREGA is to be implemented from July 1, 2026, then all operational details should be in place by now. Public consultation and discussions with state governments on these details must be done in a meaningful manner and not just to complete formalities,” he said.
Mr Ramesh said the only guarantee offered by VB-G RAM G is extreme centralization and weakening of the bargaining power of rural labour. “The constitutional right to work and the right to wages of rural Indian families is being stolen,” he said.
Published – 11 May 2026 14:13 IST
