The Union Cabinet has approved the Pradhan Mantri Viksit Gram Swaraj Yojana (PM VGSY), a Centrally Sponsored Scheme aimed at strengthening village-level governance, improving development planning and making Panchayats more financially accountable.The scheme will run from 2026-27 to 2030-31, in line with the tenure of the Sixteenth Finance Commission. It has a total outlay of ₹7,395.55 crore, comprising a central share of ₹4,869.48 crore and a state share of ₹2,526.07 crore, according to the Press Information Bureau (PIB) release dated 28 October 2026.The initiative is expected to directly benefit around 32 lakh elected representatives, Panchayat functionaries and other stakeholders across more than 2.55 lakh Panchayats and traditional local bodies.

The government also aims to reach at least one crore citizens through each coordinated public awareness exercise.Scheme to support annual development plans for 2.55 lakh PanchayatsA key objective of PM VGSY is to improve coordination between central ministries, state governments and local bodies so that village development plans reflect local priorities and make better use of available funds.Under the scheme, the government aims to support the preparation of 2.55 lakh holistic Gram Panchayat Development Plans every year through the eGramSwaraj portal.

The plans will bring together village-level requirements, government interventions and available resources on a common digital platform. Existing arrangements for delivering individual government schemes will continue.The initiative will also build on existing e-Panchayat systems to consolidate information on government schemes, beneficiaries, benefits, community assets and available resources. This is intended to help Panchayats identify gaps in development and improve the monitoring of local projects.Online audits and revenue mobilisation to improve accountabilityThe scheme will support the preparation of at least 2.55 lakh online audit plans annually and the timely completion of the corresponding audits through AuditOnline.

It also aims to strengthen accounting, public disclosure and the mobilisation of own-source revenue, helping Panchayats become more financially self-reliant.The government will use existing training, digital and outreach platforms to improve awareness of public schemes and national initiatives. These efforts will include PANCHAM, an AI-enabled, multilingual, two-way communication platform available in 17 Indian languages, alongside Gram Sabhas and other Panchayat forums.Capacity-building initiatives will focus on helping elected representatives and Panchayat functionaries use digital tools, manage resources, communicate with citizens and prepare development plans aligned with locally relevant Sustainable Development Goals.The scheme will cover all states and Union territories, including traditional rural local government institutions in areas where Panchayats do not exist.Implementation will be handled by state governments and Union territory administrations, which will submit annual action plans for appraisal and approval by a designated Central Empowered Committee.The government has said the scheme will not create permanent posts.

However, it may engage contractual personnel on a need basis at the state, district and block levels to provide technical support and help implement the programme.