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Centre Mandates 60:40 Centre-State Funding Split for VB-G RAM-G Rural Employment Scheme

Target:UPSC GS-IIIMPSCSSC GATeachingPrelims HighMains HighStatic GK Link
08 Aug 2026
~2 min
Source: Indian Express
Key Data:60:40 Centre-State funding split (general)90:10 for Himalayan/Northeast states100% central funding for UTs without legislatureTamil Nadu: Rs 5,057 crore (40% of Rs 12,642 crore)Karnataka: Rs 3,806.61 crore (40% of Rs 9,516 crore)Telangana: Rs 2,550.21 crore (40% of Rs 6,375 crore)
Bodies:Ministry of Rural DevelopmentCentreState Governments
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What This Article Covers

1.Centre revised funding pattern for VB-G RAM-G (formerly NREGA) to 60:40 (Centre:State) for general states, 90:10 for Himalayan/Northeast states, and 100% central funding for UTs without legislatures.

2.Despite political opposition, states like Tamil Nadu, Karnataka, Telangana, and Jharkhand allocated the full 40% share in their 2026-27 budgets, highlighting the scheme's critical role in rural wage security.

3.Tamil Nadu went further, promising 150 days of employment (25 extra days) at an additional cost of Rs 100 crore, reflecting the scheme's transformative impact on rural economy.

The Big Picture
Prelims · HighMains · High

The Centre has shifted the funding pattern of the National Rural Employment Guarantee Scheme (now VB-G RAM-G) from 100% central funding to a 60:40 Centre-State split (90:10 for Himalayan/Northeast states). This marks a major fiscal federalism change, with states allocating full 40% despite political opposition. Essential for Prelims (ratio, scheme name) and Mains (fiscal federalism, rural wage floor).

Exam Lens

Quick Exam Facts From News

General Funding Split60:40 (Centre:State)
Himalayan/Northeast Split90:10 (Centre:State)
UTs without Legislature100% Central Funding
Tamil Nadu Total BudgetRs 12,642 crore (State share Rs 5,057 crore)
Tamil Nadu Extra Days150 days employment (25 days extra)

1-Minute Revision

  • ›General Funding Split: 60:40 (Centre:State)
  • ›Himalayan/Northeast Split: 90:10 (Centre:State)
  • ›Target this Data: 60:40 Centre-State funding split (general), 90:10 (Himalayan/Northeast), 100% Centre (UTs without legislature).
  • ›Target this Nodal Body: Ministry of Rural Development (implements VB-G RAM-G).
  • ›Target this Legal Point: MGNREGA Act, 2005 (now under new name VB-G RAM-G). Scheme provides 100 days of wage employment.

Mastered this topic? Test your knowledge with a full MCQ quiz.

Practice exam-style questions, track your score, and strengthen your recall.

Q1Static LinkageEasy

Which ministry is primarily responsible for the implementation of the Viksit Bharat – Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-G RAM-G) scheme?

Q2Statement-basedHard

Consider the following statements:

1. VB-G RAM-G is the new name for the Mahatma Gandhi National Rural Employment Guarantee Scheme.

2. Under the new funding pattern, the Centre provides 100% funding for all states.

3. Tamil Nadu has announced 150 days of employment under the scheme, exceeding the 125-day norm.

Which of the statements given above is/are correct?

Q3Data-centricMedium

What is the Centre-state funding split for Himalayan and Northeastern states under the new VB-G RAM-G funding pattern?

Q4Application/ImpactMedium

Why did opposition states allocate the full 40% state share for VB-G RAM-G despite strongly opposing the Centre's funding change?

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