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India’s rural employment policy is at a pivotal juncture. The Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, 2025 (VB-G RAM G) is being hailed as a transformative leap, promising not just jobs but a holistic ladder out of poverty. Yet, as we move from the legacy of MNREGA to this new paradigm, it is vital to ask: are we building a bridge to prosperity, or a catalogue of aspirations that risks overpromising and underdelivering?
MNREGA: The Cost of Frictionless Welfare
MNREGA’s universal guarantee of 100 days of wage employment per rural household was a landmark in rights-based social policy. Its impact—providing a safety net during agrarian distress, empowering women, and injecting liquidity into rural economies—is undeniable. But the scheme’s design, with minimal entry barriers and little verification, created a system with almost no friction. This lack of friction made it easy for ghost beneficiaries and non-poor claimants to access funds, leading to significant fiscal waste. Administrative compliance—muster rolls, job cards—became “cheap talk,” easily manipulated by local actors. Social audits and transparency measures, while innovative, struggled to keep pace with the scale and complexity of the scheme.
The lesson is clear: when the “Cost to Defect” is low, schemes devolve into a “pooling equilibrium”—where free-riders crowd out genuine beneficiaries resulting in fiscal waste.
VB-G RAM G: Promise of Precision, Risk of Overreach
The VB-G RAM G Bill, 2025, marks a shift from universalism to targeted, multi-dimensional support. It promises not just wage employment, but a holistic guarantee encompassing skill development, enterprise support, and social security. The ambition is to move from a safety net to a springboard for rural prosperity.
VB-RAMG G aims to raise the “Cost to Defect” by way of leveraging technology—biometric authentication, real-time monitoring, geo-tagged assets, Aadhar seeded bank accounts—making it significantly harder for free-riders to game the system. The benefits are diversified linking cash transfers to skill vouchers, enterprise grants and insurance.
This is not mere administrative tinkering. It is a structural shift from “cheap talk” to “costly signalling.”. To claim a benefit, it now requires verifiable effort increasing the probability of the scheme benefiting the genuinely needy.
Type II Errors: The Hidden Cost of Friction
Yet, as critics of this change point out, the move towards higher barriers and tighter targeting brings its own risks. In the language of policy analysis, these are Type II errors: the exclusion of the genuinely needy—Women, the elderly, and marginalised communities—who would not be able to navigate the structural friction of entry which has been designed ironically to keep out the free-riders. An unintended consequence could be the Operators—Sarpanches, Local Bureaucracy et al—could easily undermine the scheme, by citing difficulties of execution owing to lack of internet speed, consistent down time of the websites etc.
To address this, the state must invest in a new cadre of “commission-driven intermediaries.” These ground-level agents would be tasked with guiding beneficiaries through the maze of documentation, digital entry, and compliance. Their responsibilities would be to perform the daily grind of compliance and conducting real-time audits. Crucially, these intermediaries would be paid only after the intended recipients have successfully received their payments, aligning their incentives with genuine inclusion and delivery. This commission-based model transforms the audit and outreach process from a passive bureaucratic function to an active, outcome-driven service—reducing exclusion and improving scheme reliability.
State Capacity and the Challenge of Convergence
Perhaps the most unmissable critique of VB-G RAM G is its sheer ambition. The Bill’s extensive range of benefits—raises a critical question: can the state deliver on such a broad mandate? It brings India’s very suspect administrative capacity into light. Experience with MNREGA and other schemes shows that even single-purpose programs struggle with leakage, delays, and exclusion. Diversifying the range of benefits, while increasing structural checks, multiplies the complexity—and the risk of failure.
The Bill’s promise of convergence with other flagship programs—Skill India, MUDRA etc.—sounds compelling on paper. But in practice, convergence is a formidable challenge. Managing uniformity in individual eligibility criteria, databases, technical interoperability, requires significantly robust invisible infrastructure that is not self-evident today given India’s siloed bureaucracy.
A suggestion here is to evaluate the local bureaucrat not by process compliance (outsourced to intermediaries), but by a utility function which is
Scope(Breadth of Genuine Beneficiaries)ImpactIncome,Skill,Asset ImprovementAssetRealisationTangible creation and Maintenance of Productive Assets
By tying bureaucratic performance to this composite utility, the state can incentivize convergence, collaboration, and innovation at the local level.
From Promise to Proof: The Road Ahead
If VB-G RAM G is to succeed where MNREGA struggled, it must combine technological rigour with human outreach. The challenge is not to trade off between fiscal waste and inclusivity, but to realise it with greater precision, accountability and ambition.
These pieces are being published as they have been received – they have not been edited/fact-checked by ThePrint.