
MGNREGA cut, VB-G RAM G gets a boost: Union Budget 2026 signals a rural reset
India Today
Under the Budget, VB-G RAM G has been allocated Rs 95,692 crore, positioning it as the single largest component of the Department of Rural Development's spending.
The Union Budget 2026–27 has signalled a shift in India’s rural employment strategy. Funding for the long-running MGNREGA scheme has been sharply reduced, indicating a move away from the 2006 rights-based programme. In its place, the Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (Gramin), or VB-G RAM G, has been positioned as the new flagship for rural job creation, backed by a significantly larger financial allocation.
Under the Budget, VB-G RAM G has been allocated Rs 95,692 crore, positioning it as the single largest component of the Department of Rural Development’s spending. What stands out is the dominance of the new scheme.
In sharp contrast, MGNREGA’s allocation has been slashed from Rs 86,000 crore in 2025–26 to just Rs 30,000 crore in 2026–27, roughly one-third of last year’s provision.
This is particularly striking given that the revised estimates for MGNREGA in 2025–26 were raised to Rs 88,000 crore to meet demand and pending dues.
Finance Minister Nirmala Sitharaman made no reference to either the new law or the scaling down of MGNREGA in her Budget speech, leaving crucial questions unanswered.
Is the reduced allocation meant merely to clear pending wage liabilities under MGNREGA? Or is it intended to fund a limited transition window as workers and states shift to the new legal framework?













