VB-G RAM G scheme - Larger, poorer States set for higher funds

Larger, poorer States set for higher funds under new rural employment scheme





 use the 16th Finance Commission



Larger, poorer States are set to get higher funding under the Centre’s new rural jobs scheme, with draft rules for the Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (VB-G RAM G) proposing to use the 16th Finance Commission’s horizontal devolution formula to determine Central allocations. 



how well States have implemented the scheme


From next year, an unknown percentage of funding will also be allocated on the basis of how well States have implemented the scheme.


These are among the proposals laid out in a gamut of draft rules notified over the last two days for the VB-G RAM G law, which is set to come into effect from July 1, replacing the 20-year-old Mahatma Gandhi National Rural Employment Guarantee Act. 


Apart from the allocation formula, the rules address provisions for 

  • grievance redressal mechanisms

  •  

    , 
  • institutional and administrative frameworks               

  •  

    , 
  •  transitional provisions -

  •  

    to govern the switchover from the UPA-era MGNREGA Act.


 shifts away from MGNREGA’s demand-based approach


One of the key features of the VB-G RAM G legislation passed by Parliament was that it shifts away from MGNREGA’s demand-based approach, which was meant to stretch the scheme’s budget to match demand on the ground.


MGNREGA worker payments


Further, while the Centre footed 100% of the wage bill under the MGNREGA, the VB-G RAM G has divided this expenditure between the Centre and States at a 60:40 ratio for most States.


devolution formula 


is based on metrics with different weightages, including the 

  • 2011 Census population, 

  • demographic performance, 

  • forests, 

  • area, 

  • per capita Gross State Domestic Product Distance, 

  • and contribution to Gross Domestic Product.


The maximum weightage - is given to the GSDP Distance (42.5%), which measures how far a State’s per capita GSDP falls short of the wealthiest States, effectively prioritising poorer States. 


population (17.5%) - 

The next highest weightage is given to population (17.5%), benefiting larger States, while all of the other metrics carry a 10% weightage each in this formula.


Performance matters

normative allocation from the second year 


will be based on “performance criteria”. This includes the 

  • “timely payment of wages”, 

  • “compliance with social audit requirements”,

  •  “percentage of completion of works”, 

  • and “any other performance-related indicators” that the Centre chooses to notify.


continuing ongoing works under MGNREGA

settling pending liabilities, transferring records, and continuing worker rights during the transition period. 


 existing e-KYC-verified MGNREGA job cards 

will remain temporarily valid until new Gramin Rozgar Guarantee Cards are issued, while fresh works may also be opened if ongoing projects are insufficient to meet labour demand.


constitute the National Level Steering Committee

 


which will “recommend decisions relating to normative allocations to States”, among other functions. 


This 

  • 16-member Committee, 
  • headed by the Union Rural Department Secretary
  • at least five representatives from State governments nominated by the Centre.


source the hindu

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