Cabinet prunes central schemes from 147 to 66

States get the freedom to spend Rs 28,000 cr allocated through central programmes

The Cabinet today approved the much-awaited decision to prune the number of centrally sponsored schemes (CSS) from the existing 147 to 66.

The Cabinet also gave state governments the freedom to spend 10 per cent of the total annual allocated amount under each scheme, according to each state’s choice.

The Cabinet also relaxed the guidelines for central schemes to meet the needs of an individual state, thereby meeting a long-pending demand from almost all state governments. The changes will be effective April 2014. However, a decision on divesting a five per cent stake in state-run Neyveli Lignite Corporation (NLC), expected to fetch the exchequer Rs 500 crore, was deferred. It is expected to be discussed tomorrow.

Officials said the 66 schemes include 17 flagship programmes of the United Progressive Alliance government, including the Mahatma Gandhi National Rural Employment Guarantee Scheme, Integrated Child Development Services and Backward Region Grant Fund.

A high-powered committee — comprising secretary (planning), secretary (finance), and secretary of the department concerned (depending on the scheme), and the chief secretary of the state —  would determine the guidelines for each scheme, according to the requirement of the state.

“We have now reduced CSS to 66. There were many different schemes in one area (like horticulture). We have condensed these to one scheme,” Planning Commission Deputy Chairman Montek Singh Ahluwalia told reporters here after the Cabinet meeting.

On flexibility, Ahluwalia said while states wouls have a flexibility to spend 10 per cent of the allocation under each scheme according to  choice, it would have to be within the broad objectives of the said programme directed towards promoting innovation.

According to officials, just like in all other schemes, the 10 per cent “flexi-funds” will be provided to the state from the Consolidated Fund of India and will not dilute the role of central ministries.

According to rough estimates, at 2013-14 levels, state governments will have the flexibility to spend Rs 27,358 crore,  of the total allocation of Rs 273,582 crore through the CSS.

FRIDAY AGENDA
The proposals likely to come before the Cabinet

• An across-the-board hike in natural gas prices
• Continuation of the Restructured Accelerated Power Development and Reforms Programme in 2012-17
• Coal price pass-through mechanism
• Selling a 5% stake in Neyveli Lignite Corporation Limited