BJP States Among Those Objecting to VB-G RAM G's Cost-Sharing Formula

As MGNREGA is set to transition into VB-G RAM G on July 1, at least three states have objected to bearing 40% of the costs.

The Wire Staff

As MGNREGA is set to transition into VB-G RAM G on July 1, at least three states have objected to bearing 40% of the costs.

bjp states among those objecting to vb g ram g s cost sharing formula

Police try to prevent a 'Save MG-NREGA' march in Jammu, February 14, 2026, Photo: PTI.

New Delhi: At least three states, two of them Bharatiya Janata Party-ruled, have raised concerns about the increased financial burden on them under the Viksit Bharat-Guarantee for Rozgar and Aajeevika Mission (Gramin), or VB-G RAM G, which replaces the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), reported The Hindu. The new scheme comes into effect on July 1, 2026.

Under VB-G RAM G, most states are required to bear 40% of the total expenditure, under a 60:40 centre-state cost-sharing pattern. This marks a significant departure from MGNREGA, where the centre bore 100% of the wage bill while states contributed only a portion of the material costs, roughly 10% of the total budget.

According to a Right to Information (RTI) reply obtained by Chakradhar Buddha of the National Campaign for People’s Right to Information (NCPRI), Bihar, Madhya Pradesh and Jharkhand explicitly sought a reconsideration of the funding pattern.

The financial stakes are considerable. Bihar’s current allocation stands at Rs 4,477 crore, sufficient for a limited number of workdays. To fund 125 days of work, the state’s liability would rise to Rs 15,939 crore. Similarly, Madhya Pradesh's current share is Rs 4,168 crore, but the 125-day requirement would push the figure to Rs 20,037 crore. In Jharkhand's case, the current share is Rs 1,804 crore. For 125 days, it would climb to Rs 9,293 crore. Jharkhand explicitly stated during consultations that bearing the 40% share would be difficult.

According to The Hindu report, the Union Rural Development Ministry shared this information in response to an RTI application, with responses from 13 states. Five states sought revisions to wage rates, arguing that current MGNREGA wages fall below market rates. Four states objected to a provision that suspends work under the scheme for a 60-day period during peak agricultural seasons. Most states flagged persistent delays in wage and material payments and sought timely clearance of dues.

Even states under the more favourable 90:10 sharing pattern, such as Sikkim and Uttarakhand, sought a review of certain provisions. Uttarakhand cited terrain-related challenges and argued for continuation of 100% central funding of wages.

VB-G RAM G aims to guarantee 125 days of unskilled manual work per rural household annually, up from 100 days under MGNREGA. It operates as a Centrally Sponsored Scheme, with normative allocations determined by the centre. States will bear any expenditure beyond their normative allocation.

This article went live on June twenty-eighth, two thousand twenty six, at fifty-eight minutes past seven in the evening.

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