Sub Group of Chief Ministers on Centrally Sponsored Schemes submitted its report

Sub-Group of Chief Ministers on rationalization of CSS on 27 October 2015 submitted its report to the NITI Aayog Chairperson and Prime Minister Narendra Modi.

The Sub-Group was appointed by the National Institution for Transforming India (NITI) Aayog in March 2015 to examine the current Centrally Sponsored Schemes (CSS) and recommend their suitable rationalisation.

Key recommendations of the Sub-Group

• Flexi-fund component of the CSS, which is in-force since June 2014, should be increased to 25 per cent from the current 10 percent to give more flexibility to states to spend on development and social welfare schemes.
• Number of CSS, which are about 50 at present, should be reduced.

• Funding pattern should be maintained at the same level-90:10 (centre: states) for 11 special category States and 60:40 for remaining states for core schemes; for optional schemes-80:20 pattern for special category States and 50:50 for others.
• To take into account the rapidly changing socio-economic situation, CSS should be reviewed every two years.

About the Sub-Group

• It was constituted in pursuance of decision taken in the first meeting of the Governing Council of NITI Aayog, held on 8 February 2015.
• Apart from the CEO, NITI Aayog as the coordinator and CM of Madhya Pradesh as the convener, it has the CMs’ of Arunachal Pradesh, Jammu & Kashmir, Telangana, Jharkhand, Kerala, Manipur, Nagaland, Rajasthan, Uttar Pradesh and Lt. Governor of Andaman & Nicobar Islands as members.
• Among other things, the Sub-Group was mandated to suggest reforms in CSS in the light of the Finance Commission recommendations for the increased devolution and the higher revenue deficit grants to states.

Differences between Centrally Sponsored and Central Sector Schemes

Centrally Sponsored Schemes: A certain percentage of the funding is borne by the States in the ratio of 50:50, 70:30, 75:25 or 90:10 and the implementation is by the State Governments. The schemes are formulated in subjects from the State List to encourage States to prioritise in areas that require more attention.

Central Sector Schemes: They are 100 percent funded by the Union government and implemented by the Central Government machinery. The schemes are mainly formulated on subjects from the Union list and resources under these Schemes are not generally transferred to States.

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