Need to reduce centrally sponsored schemes to improve spending: N K Singh

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  1. The Fifteenth Finance Commission Chairman N K Singh has said the number of centrally sponsored schemes currently exceeds 150 that needs to be reduced for better spending as revenue buoyancy in indirect taxes remains weak.
  2. Centrally Sponsored Schemes(CSS) are schemes that are implemented by state governments of India but are largely funded by the Central Government with a defined State Government share.
  3. CSS is divided into three parts (a)core of the core (b)core and (c)optional .These are divided on the basis of financial involvement of the states.For example,the MGNREGA scheme which comes under the core of the core group will see the state pooling in 25% of funds whereas the rest is taken care of by the Centre.
  4. Similarly,schemes under the core group will see a higher share of state involvement of up to 40% whereas in optional schemes,states will fund up to 50%.However,financially backward states need to bear only 20% of the financial burden.
  5. On the other hand,Central Sector Schemes are the schemes that are entirely and directly funded and executed by the central government. The schemes are formulated by the Centre based on subjects from the Union List.

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