Wednesday 3 June 2015

Difference between Centrally Sponsored Schemes and Central Sector Schemes

  • Nomenclature is based on two things
    • Pattern of funding
    • Modality for implementation
Difference Between Centrally Sponsored Schemes and Central Sector Schemes
S. No.
Centrally Sponsored Scheme
Central Sector Scheme
Certain % is borne by states like: 50:50, 75:25, 90:10

Fund Route:
Consolidated fund of States and/or 
Transferred directly to State/ District Level Autonomous Bodies/Implementing Agencies.
100% by Union government
Implementation by
State Government
Central Government Machinery
Subject of which list under Schedule VII are covered
State List (List - II)
Mainly Union List (List -I)
Additional Information
As pet Baijal Committee report, 1987: Centrally Sponsored Schemes are defined as the schemes which are funded directly by Central Ministries/Departments and implemented by States or their agencies, irrespective of their pattern of financing, unless they fall under the Union List.
Some schemes directly implemented in States/UTs but resources are not generally transferred to states
Centrally Sponsored Schemes (CSS) and Additional Central Assistance (ACA) Schemes 

  • Conceptually both passed by Centre to State government but few difference are:
    • Historical evolution
    • Budgeting
      • CSS: Budget allocated under concerned ministry 
    • Control
    • Release of funds
Problems of Centrally Sponsored Schemes

  • Lack of flexibility
  • Under CSS state has to do certain amount of funding which is generally equivalent of how much the centre has given to state. This has adverse implications on state finances
  • Resources are thinly spread but the number of Centrally sponsored schemes is too large. 

Solution of problems of Centrally Sponsored Schemes (CSS)

  • 2011: Planning Commission constituted a Sub-Committee for suggesting restructuring of CSS to enhance its flexibility and efficiency.
  • 28th February 2013: Budget speech Finance minister also raised concern on rising number of CSS
  • 2013: Union Cabinet decided to restructure the existing CSS/ACA schemes in the Twelfth Five Year Plan into 66 schemes, including 17 flagship programmes
    • To bring in desired flexibility, the Cabinet approved that 10% of the outlay of the Schemes be kept as flexi-funds. 
    • For each new CSS/ACA/Flagship scheme, at least 25% of funds may be contributed by the General Category States and 10% of funds by the special category states including J&K, Himachal Pradesh and Uttarakhand. 
  •  14th Finance Commission (FFC) 
    • Share of the States in the Central divisible pool from the current 32 % -->  42 % (the biggest ever increase in vertical tax devolution).
      • This tax devolution is untied and can be spent as desired by the States. 
      • This also led to reduced fiscal space for the Centre 
        • So many schemes on the State subjects were to be delinked from Central support or states were to contribute higher share

  • But exception was created to above delinking: 
    • Centre (through Budget 2015-16) to continue to contribute to such schemes representing national priorities, especially those targeted at poverty alleviation by helping socially disadvantaged group. 
    • The schemes mandated by legal obligations and those backed by Cess collection would be fully provided for by the Central Government.
  • In the Union Budget 2015-16
    • Fully Sponsored Schemes by Union government: 31
    • Schemes delinked from support of the Centre: 8
    • Schemes which will run with the changed sharing pattern: 24.  

(A) Schemes to be fully supported by Union Government:
1.      Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA)
2.      Multi-Sectoral Development Programme for Minorities (MSDP)
3.      Pre-Matric scholarship for children of those engaged in unclean occupation
4.      Scholarship Schemes (Post and Pre-Matric) for SC, ST and OBCs
5.  Support for machinery for Implementation of Protection of Civil Rights Act, 1955 and Prevention of Atrocities Act, 1989
6.      National Programme for Persons with Disabilities
7.      Scheme for providing Education to Minorities
8.      Umbrella Scheme for education of ST children
9.      Indira Gandhi Matritva Sahyog Yojana (IGMSY)
10.  Integrated Child Protection Scheme (ICPS)
11.  Rajiv Gandhi Scheme for Empowerment of Adolescent Girls (RGSEAG)-SABLA
12.  National Nutrition Mission
13.  Scheme for Protection and Development of Women
14.  Assistance for Schemes under Proviso (i) to article 275 (1) of the Constitution
15.  Special Central Assistance to Tribal Sub-plan
16.  Sarva Shiksha Abhiyaan (Financed from Education Cess)
17.  Mid Day Meal
18.  Schemes of North Eastern Council
19.  Special package for Bodoland Territorial Council
20.  National Social Assistance Programme (NSAP) including Annapurna
21.  Grants from Central Pool of Resources for North Eastern Region and Sikkim
22.  Social Security for Unorganized Workers Scheme
23.  Support to Educational Development including Teacher Training and Adult Education
24.  Border Area Development Programme
25.  Member of Parliament Local Area Development Scheme (MPLADS)
26.  Cess backed allocation for Pradhan Mantri Gram Sadhak Yojana (PMGSY)
27.  Roads and Bridges financed from Central Road Fund
28.  Project Tiger
29.  Project Elephant
30.  Additional Central Assistance for Externally Aided Projects (loan portion)
31.  Additional Central Assistance for Externally Aided Projects (Grant portion)

(B)  Schemes to be run with the Changed Sharing Pattern:
1.      Cattle Development
2.      Mission for Integrated Development of Horticulture
3.      Rashtriya Krishi Vikas Yojana
4.      National Livestock Mission
5.      National Mission on Sustainable Agriculture
6.      Dairy Vikas Abhiyaan
7.      Veterinary Services and Animal Health
8.      National Rural Drinking Water Programme
9.      Swaccha Bharat Abhiyaan (Rural and Urban)
10.  National Afforestation Programme
11.  National Plan for Conservation of Aquatic Eco-system (NPCA)
12.  National AIDS and STD Control programme
13.  National health Mission
14.  National Urban Livelihoods Mission (NULM)
15.  Rashtriya Madhyamik Shiksha Abhiyaan (RMSA)
16.  Strategic Assistance for State Higher Education – Rashtriya Uchcha Shiksha Abhiyan (RUSA)
17.  For Development of Infrastructure Facilities for Judiciary
18.  National Land Records Modernisation Programme
19.  National Rural Livelihood Mission (NRLM)
20.  Rural Housing-Housing for All
21.  Integrated Child Development Service
22.  Rajiv Gandhi Khel Abhiyan (RGKA) (erstwhile Panchayat Yuva Krida aur Khel Abhiyan (PYKKA)
23.  PMKSY (including Watershed programme and micro irrigation)
24.  Impact Assessment Studies of AIBFMP

(C) Schemes delinked from support of the Centre:
1.      National e-Governance Plan
2.      Backward Regions Grant Funds
3.      Modernization of Police Forces
4.      Rajiv Gandhi Panchayat Sashaktikaran Abhiyaan (RGPSA)
5.      Scheme for Central Assistance to the States for developing export infrastructure
6.      Scheme for setting up of 6000 Model Schools
7.      National Mission on Food processing
8.      Tourist Infrastructure


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