Union Budget 2026: VB-G RAM G Scheme Receives Substantial Allocation Despite Speech Omission
In the Union Budget for the financial year 2026-27, Finance Minister Nirmala Sitharaman allocated a significant sum of Rs 95,692.31 crore for the Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin), commonly known as the VB-G RAM G scheme. Interestingly, this allocation was not explicitly mentioned in her budget speech, yet it aligns with the provisions outlined in the Bill itself. The scheme is set to replace the long-standing Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), marking a pivotal shift in India's rural employment policies.
MGNREGS Allocation and Transition Details
For the upcoming financial year beginning April 1, 2026, the Finance Minister also allocated Rs 30,000 crore for MGNREGS. This allocation is intended to support the scheme until the new VB-G RAM G scheme comes into effect. In the current financial year 2025-26, the allocation for MGNREGS has been revised upward to Rs 88,000 crore at the revised estimate (RE) stage, from an initial budgetary estimate (BE) of Rs 86,000 crore. This adjustment reflects the government's ongoing commitment to rural employment during the transition period.
Key Features of the VB-G RAM G Scheme
The VB-G RAM G Act, enacted in December 2025, replaces the two-decade-old MGNREGA, 2005. Unlike its predecessor, where the Centre bore 100% of the wage bill, VB-G RAM G is a centrally sponsored scheme with a fund-sharing ratio of 60-40 between the Centre and states for most states. For North Eastern Region (NER) States, Himalayan states, and Union Territories with legislatures, the ratio is 90-10, while Union Territories without legislatures receive a 100% central share. The scheme aims to provide a statutory guarantee of 125 days of wage employment per financial year to rural households, focusing on empowerment, growth, and convergence for a prosperous rural India.
Impact on Other Rural Development Schemes
The budget also revealed significant adjustments in allocations for other key rural development initiatives:
- Pradhan Mantri Awaas Yojana-Gramin (PMAY-G): Allocation was drastically cut to Rs 32,500 crore at the RE stage for 2025-26, from Rs 54,832 crore in the BE. For 2026-27, it has been set at Rs 54,916.7 crore.
- Pradhan Mantri Gram Sadak Yojana (PMGSY): Revised to Rs 11,000 crore in RE from Rs 19,000 crore in BE 2025-26, with an allocation of Rs 19,000 crore for 2026-27.
- Deendayal Antyodaya Yojana-National Rural Livelihoods Mission (DAY-NRLM): Revised downward to Rs 16,000 crore in RE from Rs 19,005 crore in BE 2025-26, and set at Rs 19,200 crore for the next financial year.
- National Social Assistance Programme (NSAP): Allocation for 2026-27 is Rs 9,671 crore, slightly up from Rs 9,652 crore in the current year, with a revision to Rs 9,197 crore at the RE stage.
Context and Current Statistics
Under MGNREGS, 5.01 crore families have availed unskilled work till February 1 during the current financial year 2025-26, highlighting the scheme's widespread reach. The transition to VB-G RAM G is expected to build on this foundation while introducing new structural changes to enhance rural resilience and economic growth.
