The Finance Ministry has initiated a comprehensive review and re-approval process for all Centrally Sponsored Schemes (CSSs) and Central Sector Schemes (CSs).
- This major review, starting April 1, 2026, aligns with the upcoming 16th Finance Commission cycle.
- Policy Background: The 2016 Union Budget introduced a policy of:
- Outcome-based evaluation
- Sunset clauses for all schemes
- Third-party reviews
- This aligns schemes with Finance Commission cycles, ensuring accountability and better results.
Objectives of the Review
- Recalibrate Scheme Design: Ministries were urged to review and redesign schemes based on past performance and future relevance.
- Eliminate Redundancies: Schemes that overlap or are no longer effective will be identified and streamlined.
- Merge or Close Schemes: Programs that have achieved their goals or are underperforming may be merged or discontinued.
- Evaluation Agencies:
- Centrally Sponsored Schemes (CSSs): Evaluated by Development Monitoring and Evaluation Office (DMEO) under NITI Aayog.
- Central Sector Schemes (CSs): Evaluated by third-party agencies chosen by the respective ministries.
Centrally Sponsored Schemes (CSSs)
- Centrally Sponsored Schemes (CSSs) are government programmes funded jointly by the Central and State Governments, but implemented by the States.
Key Features of Centrally Sponsored Schemes
- Funding Pattern: The cost of implementation is shared between the Central Government and State Governments.
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- General States: 60:40 (Centre:State)
- North-Eastern and Himalayan States: 90:10
- Union Territories: 100% funded by the Centre
- Policy and Design: The Central Government formulates the policy framework and guidelines for the scheme.
- State Governments are responsible for execution, adaptation to local needs, and monitoring on the ground.
- Objective: Centrally Sponsored Schemes are aimed at:
- Poverty alleviation
- Health and education improvement
- Rural development
- Agriculture and irrigation support
- Infrastructure development
- Social welfare
- Examples of CSS:
- MGNREGA (Mahatma Gandhi National Rural Employment Guarantee Act)
- PMAY-G (Pradhan Mantri Awas Yojana – Gramin)
- PMGSY (Pradhan Mantri Gram Sadak Yojana)
- Mid-Day Meal Scheme
- National Health Mission
- Classification: As of recent reforms, CSS are categorized into Core of the Core, Core, and Optional schemes based on their national importance.
- Coordination: The NITI Aayog plays a role in the evaluation and rationalization of CSS.
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- Ministries and Departments of the central government oversee their respective schemes.
Central Sector Schemes (CSs)
- Central Sector Schemes are government initiatives fully funded and implemented by the Central Government of India.
Key Features of Central Sector Schemes
- Funding: Unlike Centrally Sponsored Schemes (which involve cost-sharing with states), CSs are entirely financed by the Centre.
- Implementation: Usually implemented directly by central agencies, ministries, or public sector undertakings (PSUs). In some cases, state agencies may help in execution.
- Policy & Administration: Full control over design, administration, and monitoring lies with the central government.
- Objective: Focused on national importance, such as defense, atomic energy, space, and major infrastructure development.
- Examples of Central Sector Schemes:
- PM-KISAN (Pradhan Mantri Kisan Samman Nidhi)
- UDAN (Ude Desh ka Aam Naagrik)
- Startup India
- Beti Bachao Beti Padhao
- National Digital Health Mission
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