Centrally Sponsored Schemes Current Affairs - 2020

Government reduces number of centrally sponsored schemes to 28

The Union Government has reduced the number of centrally sponsored schemes (CSS) from 66 to 28 umbrella schemes, effective from the financial year 2016-17.

These schemes were reduced based on the recommendation of the sub-group of Chief Ministers on rationalisation of centrally sponsored schemes.

Key Facts
  • Government has categorised 6 schemes as Core of the Core, 20 schemes as Core Schemes and remaining two as Optional Schemes.
  • If required government is also planning to merge the related schemes and implement them as Umbrella Schemes with flexibility to states to administer in the line with their requirements.
  • Core schemes: For these schemes, the fund-sharing pattern between the Centre and states would be 60:40 for general category states. For the eight Northeastern and three Himalayan states, ratio is 90:10.
  • Core-of-core Schemes: These schemes are fully funded by the Centre. Some of the schemes included in this category are: MGRNEA, National Social Assistance Plan and the National Programme for Persons with Disabilities.
  • Optional Schemes: These schemes are for social protection and social inclusion. The fund-sharing pattern between the Centre and states is 50:50 for general category states and 80:20 for Northeastern and hilly states.
  • Funds for these schemes will be allocated to states as a lump sum and states would be free to choose which optional scheme they want to adopt.
What are Centrally Sponsored Schemes (CSS)?
  • CCS are schemes that are implemented by state governments but are largely funded by the Central Government with a defined State Government share.
  • They are basically special purpose grants (or loans) extended by Central Government to states to encourage them to plan and implement programmes that help attain national goals and objectives.
  • CSS are basically extended by the Central Government to States under Article 282 of the Constitution. It mainly cover items listed in states list.

Union Government issues fresh guidelines for flexi-fund for CSS

The Union Finance Ministry has issued fresh flexi-fund guidelines for the Centrally Sponsored Schemes (CSS).

These flexi-fund guidelines will give states more freedom in spending money under the CSS  to meet local developmental requirements.

These guidelines were based on the instructions issued by NITI Aayog for rationalisation of Centrally Sponsored Schemes. These recommendations were based on instructions of the sub-group of Chief Ministers of states and consultations with stakeholders

Key Facts

  • Under the new norms, flexi-funds in each CSS has been increased from the current 10% to 25% for states and 30% for Union Territories.
  • This means that states if they so desire can set aside 25% of any CSS as flexi-fund to be spent on any sub-scheme or innovation or component that is in line with the overall aim and objective of the approved Centrally Sponsored Scheme.
  • States can use the fund to satisfy local requirements in areas affected by internal security disturbances or to undertake mitigation or restoration activities in case of natural calamities.
  • State governments will have to constitute a state-level sanctioning committee (SLSC) to avail of the flexi-fund facility. This facility is not for CSS which emanate from a legislation, like MNREGA.