Cabinet to mull lowering Central Schemes to 52
Last year, the B K Chaturvedi panel had recommended merging the schemes with one another to reduce the number to enhance their flexibility, scale and efficiency
A proposal to restructure Centrally Sponsored Schemes (CSS) to increase their effectiveness will soon be considered by the Cabinet. The Planning Commission is working on the proposal that seeks to reduce the number of schemes from 147 at present to 52 from the next financial year.
Last year, the B K Chaturvedi panel had recommended merging the schemes with one another to reduce the number to enhance their flexibility, scale and efficiency. Finance Minister P Chidambaram has pushed for early implementation of the report.
“It will go to the Cabinet soon. There won’t be much savings for the Centre after the merger of the schemes, but it will give a lot of flexibility to the states in terms of using the funds and their administrative costs will come down,” said a government official familiar with the development.
Currently, states are not able to spend allocated funds for some schemes, whereas they feel scarcity of resources with regards to some other schemes but cannot divert the funds. If the schemes are merged, they will be free to use funds as per the requirement.
CSS have been introduced in areas that are of national priority like health, education, agriculture, skill development, employment, urban development, and rural infrastructure.
The number of CSS had increased from 190 at the end of Fifth Plan to 360 at the end of Ninth Plan. The number of schemes declined from 155 to 99 at the beginning of Eleventh Plan and subsequently increased to 147. The share of CSS as percentage of gross budgetary support has increased in the last three Plans. In the Eleventh Plan it went up to 41.59 per cent, against 38.64 per cent in the Tenth Plan.
The Chaturvedi panel observed CSS with small outlays do not achieve the objective of making an impact across the states. Such schemes are, therefore, not suitable as a CSS and need to be implemented by the states, unless required as part of convergence process of a broader scheme at the Centre. About 44 per cent of the total CSS have an average annual outlay of less than Rs 100 crore.
“These schemes should either be weeded out or merged for convergence with larger sectoral schemes or be transferred to states, which can then continue with these schemes based on their requirements,” it said.
The report has recommended restructuring schemes into three categories-- flagship schemes which will address major national interventions required on education, health, irrigation, urban development infrastructure, rural infrastructure, skill development, employment and other identified sectors; major sub-sectoral schemes to address developmental problems of sub-sectors of major sectors like agriculture, education and health; sector umbrella schemes which will address the sectoral gaps to help improve effectiveness of Plan expenditure.