The Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-G RAM G) Act has replaced the Mahatma Gandhi National Employment Guarantee Act (MGNREGA).
Under the new law, the Centre will release funds to states based on certain norms, moving away from the open-ended funding, linked to demand, under the MGNREGA.
The report has arrived at the gains to states by estimating the difference between the central fund release based on the normative assessment using objective criteria, as proposed in the new law, and the average allocation under the MGNREGA between FY19 and FY25, excluding the pandemic year of FY21.
“Based on the hypothetical weights and inter-se distribution, all states gain in our hypothetical scenario, barring two states (Tamil Nadu and Andhra Pradesh) with almost minimal losses,” the report said.
Uttar Pradesh and Maharashtra emerge as the top gainers, followed by Bihar, Chhattisgarh and Gujarat, said the report by Soumya Kanti Ghosh, group chief economic advisor at SBI.
The new law requires states, barring the Himalayan and north-eastern ones, to bear 40% of the wage costs of unskilled labourers. The Centre used to bear such costs alone under the MGNREGA.The central government has estimated the cost of implementing the scheme across the country at ₹1,51,282 crore in FY27. Of this, the Centre’s share is pegged at ₹95,692 crore. This is 11% higher than the Centre’s budgetary allocation of ₹86,000 crore for FY26.