That looks more like a Remington lug, the savage 110 has an indexing notch, but they do the same thing...
They are there to transfer recoil from the action to the stock, absorbing most of the energy there rather than incidental parts touching bedding and stock sides flexing outward.
There should not be any clearance on the rear of the lug. There should be clearance on the bottom of the lug to provide clearance in a broad range of ambient temperatures. Some give the sides some clearance to make it easier to take the action out of the bedding. Some also give clearance to the front of the lug.
I make clearance on the bottom only. The sides are easier to justify the logic on, but I still do not accept it. The action will not move side to side, regardless the room on the sides of the lug... However, the idea of making room forward of the lug really makes me wonder...
art
