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More central schemes likely to be merged or winded up

The 14th Finance Commission was set up on January 2, 2013

More central schemes likely to be merged or winded up

NEW DELHI: The 15th Finance Commission (XV-FC) headed by N.K. Singh will submit its report by the end of November and it is learnt to have given fresh review on the Centrally Sponsored Schemes and suggesting possible winding up or merger of certain schemes in view of their duplication, poor outcomes, rising outlays.

Finance Ministry sources said the 15th Finance Commission (XV-FC) has been mandated to submit its report by November 30. And prior to the submission of its report, nothing can be anticipated regarding elimination of certain centrally sponsored schemes.

But with revenues dwindling and fiscal sops worth Rs 1.45 lakh crore already given on corporate tax cuts account, the ministry wants a fresh look at the schemes to rationalise CSSs’ numbers and also expenditures. Finance Minister Nirmala Sitharaman recently said she would not disturb the welfare schemes. Since the CSS lifecycle is now co-terminus with that of the Finance Commission — here the 14th FC which is coming to a close in March next — it’s time for a fresh review of these schemes.

The government has already reduced the number of centrally sponsored schemes (CSS) to 28 umbrella schemes from 66. There are many CSS in these areas like piped water, Swachh and Ayushman Bharat. The Commission has listed the Achievements and drawbacks in implementation of flagship schemes of Government of India.

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.Such schemes are Mahatma Gandhi National Rural Employment Guarantee Act (Rs 60,000 crore), Pradhan Mantri Gram Sadak Yojana (Rs 80,000 crore).

Umbrella Scheme for Development of Scheduled Cast es (Rs 5,395 crore), Umbrella Scheme for Development of Scheduled Tribes (Rs 3,810 crore), Umbrella Programme for Development of Minorities and Umbrella Sc heme for Development of Backward Classes, Differently Abled and other Vulnerable Groups (Rs 1,227 crore), National Social Assistance Programme (Rs 9,200 c rore) and Umbrella Programme for Development of Minorities (Rs 1,515 crore).

The 14th Finance Commission was set up on January 2, 2013. Headed by former Reserve Bank of India Governor Y.V. Reddy, its recommendations cover the period from April 1, 2015 to March 31, 2020. The Fourteenth Finance Commission had stepped up the share of states in net central taxes to 42 per cent from 32 per cent.

The 15the FC will has studied the impact on the fiscal situation of the Union Government of substantially enhanced tax devolution to States following recommendations of the 14th Finance Commission.

The primary task of the commission is to decide the formula for the distribution between the Centre and the states of net proceeds of taxes and the horizontal allocation of the devolution among states.

It also decides on the rules for grants-in aid to the states out of the Consolidated Fund of India. Fifteenth Finance Commission that will decide the formula for sharing of tax es between the Centre and states for five years starting April 1, 2020.

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