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Centre schemes: PC pushes for 20% 'flexi funds'

Punjab education minister Sikander Singh Maluka has been speaking out strongly against the "utility" of some of the centrally sponsored schemes, conceived without taking local factors into consideration, for his state.

chandigarh Updated: Jan 30, 2013 10:57 IST
Navneet Sharma

Punjab education minister Sikander Singh Maluka has been speaking out strongly against the "utility" of some of the centrally sponsored schemes, conceived without taking local factors into consideration, for his state.

While his outburst has been viewed with scepticism by many in his own government, the minister's remarks on the one-size-fits-all approach of the central government in schemes for the education sector are not entirely out of place. The Centre is already grappling with some of these issues following demands by the chief ministers of several states for wiggle room in utilisation of funds under such schemes as per their specific requirements.

The Planning Commission has, in its report on the 12th Five Year (2012-17) plan document last month, set the ball rolling for restructuring of the centrally sponsored schemes to provide "flexibility" to the state governments. "The physical and financial norms for the schemes may be varied depending on the requirements of the state. All such programmes must have 20% "flexi funds" except for the flagship schemes where it should be 10%," according to a committee set up under Planning Commission member BK Chaturvedi on restructuring of these schemes.

The committee said these flexi funds should be utilised by the states to prepare schemes entirely suited to the requirement of that state. Besides, the flagship schemes, which have
large budget outlays, would also provide a flexible pool of financial resources to be used to facilitate and incentivise innovative practices that blaze a trail for others to follow during the 12th plan period.

"The need for flexibility has been an important area impacting efficient implementation of the schemes. Varied requirements of states, different levels of infrastructure development, growing urbanisation, density of population, etc, require flexibility for states to spend part of the funds for meeting special needs," the committee reasoned.

The Planning Commission said these measures should take care of the large variation often requested by north-eastern states or states like Himachal Pradesh, Kerala, Rajasthan and Uttarakhand which have special needs," said the plan panel.

Under the centrally sponsored schemes, the Centre makes substantial fund transfers to the states. In 2011-12, Rs 1.8 lakh crore was earmarked for a total of 147 schemes, with 14 flagship schemes such as National Rural Health Mission, Sarva Shiksha Abhiyan, Mahatma Gandhi National Rural Employment Guarantee Scheme, Mid-Day Meal Scheme, Pradhan Mantri Gram Sadak Yojana and Integrated Child Development Scheme alone accounting for more than two-thirds of the allocation. The flagship schemes are funded through direct fund transfers or additional central assistance.

The ring-fence put by the government around funding given under these schemes has been causing resentment among the governments in several states, which feel constrained by fixed norms, stringent specifications and frequently changing funding patterns for these schemes without taking into consideration the states' needs and ability to provide their matching share. Though most of the states are not for abandoning these programmes, there have been demands by some chief ministers in recent years for much greater say in their implementation and even direct transfer of funds without any restrictions to the states in some areas.

In one of the National Development Council meetings, Punjab chief minister Parkash Singh Badal said the Centre should discontinue the centrally sponsored schemes in sectors, which are in the states' domain and funds released from them might be allocated to the states without any conditions. Like some other states, the fund-starved Punjab government has also not been able to take full advantage of several of these schemes being implemented due to its inability to provide its matching contributions. While a number of states are also pushing for 100% funding from the union ministries for these programmes, the Centre has countered it with the argument that the sharing of financial support was needed for the states to be partners in progress and ownership of the programmes.

Flagship schemes: Punjab allocation in 2011-12
National Rural Health Mission - Rs 325 crore
Mid-Day Meal Scheme - Rs 238 crore
Sarva Shiksha Abhiyan - Rs 1,052 crore
Mahatma Gandhi National Rural Employment Guarantee Scheme - Rs 300 crore
Integrated Child Development Scheme - Rs 135 crore
Rashtriya Krishi Vikas Yojana - Rs 138 crore
Pradhan Mantri Gram Sadak Yojana - Rs 350 crore