Govt to replace MGNREGA with new rural jobs scheme G RAM G, guarantees 125 days of work at near Rs 96,000 crore budget allocation

In one of the biggest overhauls of India’s rural employment architecture in two decades, the Centre on Sunday announced that the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) will be replaced by a new employment and livelihood framework — the Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (Gramin), or VB–G RAM G — from July 1, 2026.

The new law raises the statutory rural employment guarantee from 100 days under MGNREGA to 125 days a year for eligible rural households willing to undertake unskilled manual work, marking what the government described as a “historic transition” towards a more “future-ready and productivity-oriented rural transformation” aligned with the Viksit Bharat @2047 vision.

Also Read: VB-G RAM G & PMAY-G account for 63 pc of Dept of Rural Development Budget: Report

The government has allocated a record Rs 95,692.31 crore for the programme in FY27 at the Budget Estimate stage — the highest-ever allocation for a rural employment programme — with the total outlay, including states’ contributions, expected to exceed Rs 1.51 lakh crore.

The Ministry of Rural Development said the transition from MGNREGA to the new framework would be seamless, with all existing job cards remaining valid and ongoing projects continuing without interruption after June 30.

“Employment under MGNREGA shall continue uninterrupted till the date of commencement of the new Act,” the ministry said, adding that all ongoing works would be “saved and carried over in the new framework seamlessly”.

The government also sought to reassure workers that no eligible household would face inconvenience during the transition period and said labour budget provisions had already been aligned with state-level demand patterns. Existing e-KYC verified MGNREGA job cards will remain operational under the new system until fresh Gramin Rozgar Guarantee Cards are issued. Workers without job cards can continue registering through Gram Panchayats.Also Read: G-RAM G: Your two-minute guide to the bill that will replace MGNREGA

Under the new framework, workers will continue receiving wages directly into their bank or post office accounts through Direct Benefit Transfer (DBT), with payments mandated on a weekly basis or within 15 days of muster roll closure. Delay compensation provisions and unemployment allowances will also continue under the Act.

The government said the VB–G RAM G Act places greater emphasis on rural infrastructure creation, livelihoods and village-level productivity while positioning Gram Panchayats at the centre of implementation and local transformation.

A series of draft rules covering wage payments, grievance redressal, administrative expenditure, unemployment allowance, transition provisions and allocation norms are currently being prepared in consultation with states and Union Territories and will soon be released for public consultation, the ministry added.