Central Scheme

Central Scheme denotes a programme launched by the Union Government of India that is financed, designed, and monitored at the national level but often executed through state agencies. Unlike purely state‑run initiatives, a Central Scheme carries the weight of national policy, a uniform budgetary allocation, and a set of guidelines that aim to bridge regional disparities while targeting priority sectors such as health, employment, housing, and sanitation. ## Origins and Constitutional Basis The legal foundation for Central Schemes lies in Articles 246 and 280 of the Indian Constitution, which delineate the distribution of legislative powers and empower the Finance Commission to recommend the sharing of tax revenues between Centre and States. The first centrally sponsored programme, the Community Development Programme, was introduced in 1952 to promote rural upliftment, setting a precedent for later flagship schemes. Over the ensuing decades, successive Five‑Year Plans institutionalised the concept, culminating in the 1991 economic reforms that formalised the “centrally sponsored scheme” (CSS) category to ensure coordinated delivery of welfare services across a liberalising economy. ## Operational Mechanism A Central Scheme is typically announced in the Union Budget, assigned a specific outlay, and placed under the administrative control of a Union Ministry—e.g., the Ministry of Health and Family Welfare for the National Rural Health Mission (NRHM) launched in 2005. The Ministry issues detailed guidelines, performance indicators, and a Management Information System (MIS) for real‑time monitoring. State governments receive the earmarked funds either as 100 % central assistance (for schemes like the Swachh Bharat Mission) or as a matching grant, where the Centre contributes a stipulated percentage—often 60 % for health‑related CSS and 90 % for infrastructure‑focused programmes. Implementation is delegated to state‑level agencies such as the State Health Society or the Rural Development Department, which in turn contract local NGOs or panchayats for ground‑level execution. Quarterly reports are consolidated at the central level, enabling corrective actions and the release of subsequent instalments. ## Key Provisions and Funding Model Central Schemes are governed by a set of statutory and procedural provisions that ensure fiscal discipline and accountability. The 15th Finance Commission (2020) mandated that the aggregate outlay for CSS should not exceed 12 % of the total plan expenditure, translating to an estimated ₹2.5 lakh crore for the 2023‑24 fiscal year across 73 active schemes. Specific provisions include: * Eligibility Criteria – Beneficiary identification is anchored to census‑based poverty lines, Scheduled Caste/Tribe status, or geographic deprivation indices, as seen in the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) which guarantees 100 days of wage‑employment per household. * Audit and Evaluation – The Comptroller and Auditor General (CAG) conducts annual audits, while independent evaluation agencies such as the National Institution for Transforming India (NITI Aayog) publish performance dashboards for schemes like the Pradhan Mantri Awas Yojana (PMAY) launched in 2015. * Disbursement Mechanisms – Funds flow through the Central Finance System (CFS) and are credited to state treasuries via the Treasury Single Account (TSA), reducing leakages and enabling direct benefit transfers (DBT) for cash‑based programmes. These provisions collectively aim to align national objectives with state capacities while preserving transparency. ## Current Status and Impact As of the 2024 Union Budget, the Centre has retained 73 centrally sponsored schemes, ranging from the National Nutrition Mission (POSHAN Abhiyaan) to the Digital India Programme. The NRHM, rebranded under the National Health Mission in 2013, has expanded primary health centres from 20,000 in 2005 to over 30,000 by 2023, contributing to a decline in infant mortality from 58 per 1,000 live births (2005) to 28 per 1,000 (2022). MGNREGA continues to generate an average of 1.2 crore person‑days of employment per month, with a fiscal outlay of roughly ₹1.2 lakh crore in 2023‑24. The centralised design of these schemes has facilitated rapid scaling—e.g., the Swachh Bharat Mission achieved 100 % coverage of rural households with toilets by 2019, a feat attributed to uniform funding and nationwide monitoring. Nonetheless, challenges persist: variations in state administrative capacity lead to uneven quality of service delivery, and the growing number of CSS has prompted calls for rationalisation to avoid fiscal overlap. The ongoing dialogue between the Centre and States, mediated by the Finance Commission and NITI Aayog, underscores the dynamic nature of Central Schemes