Centre partially concedes State’s request relating to CSS

The Central government appears to have partially conceded the State’s request related to bringing down the number of centrally-sponsored schemes (CCS).

Union Finance Minister Nirmala Sitaraman said in her budget speech in Lok Sabha on Monday that a detailed exercise had been undertaken to rationalise and bring down the number of centrally sponsored schemes on the recommendations made by the XV Finance Commission. The exercise would enable consolidation of the outlays for better impact.

The development follows the fervent appeal made by State Finance Minister T. Harish Rao to the Centre to address the nagging issue of proliferation of CSS. The Minister said the Centre had had simply grouped these schemes under 28 umbrella heads instead of reducing their number. The sub group of Chief Ministers, of which Chief Minister K. Chandrasekhar Rao was a member, recommended that a facility of optional schemes should be provided to States and the Centre had accepted the same.

This, according to Mr. Harish Rao, would enable States to have flexibility of portability from the optional schemes to any other CSS within the budgetary allocation of the State. The Centre should therefore ensure that Union Budget 2021-22 offered a bouquet of optional schemes to States. The Union Minister had accordingly announced that steps had been taken to rationalise and bring down the number of CSS for consolidation of their outlays for better impact.

Mr. Harish Rao recalled that it is an established practice to treat the recommendations of Finance Commission relating to transfers to States as an award. The Centre, however, departed from this practice for the first time in respect of recommendation relating to special grants to three States to make up for shortfall in tax devolution in 2020-21.

As a result of this, Telangana was denied special grant of ₹723 crore during the current fiscal, he said, requesting the Union Minister to consider releasing this grant and restore the practice of treating the recommendations of the Finance Commission as an award while considering the report of the XV Finance Commission for the years 2021-26. The Centre is yet to make its stand clear on the issue as there was no mention of release of the special grant to the State in the budget speech made by Ms. Sitaraman.

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