Govt's 5-Yearly Appraisal of CSSs & CSs

New Delhi, May 29 (PTI) The Finance Ministry on Thursday said the government has kickstarted an elaborate exercise for five yearly appraisals and approval of centrally sponsored schemes and central sector schemes to be made effective from April 1, 2026.

The Department of Expenditure under the Ministry of Finance on Thursday organised a workshop chaired by Cabinet Secretary T V Somanathan with the Secretaries of various ministries and departments.

Finance Secretary Ajay Seth, Expenditure Secretary Vumlunmang Vualnam and other senior officers were also present.

Through the workshop, the government has "initiated an elaborate exercise for 'Appraisal and Approval of the Centrally Sponsored Schemes (CSSs) and the Central Sector Schemes (CSs)' for their continuation over the next five years. The new five-year cycle will start on April 1, 2026, and is aligned with the 16th Finance Commission (FC) cycle," the ministry said.

During the meeting, the Cabinet Secretary emphasised the rigour of the evaluation process and urged the secretaries to use its recommendations to recalibrate the design and architecture of the scheme, remove redundancies and ineffective suboptimal interventions, merge schemes and close schemes which have either outlived their utility or have fulfilled their objectives. This will enable optimum deployment of scarce public resources, a finance ministry statement said.

Secretaries were informed about the norms likely to be used for deciding the resource envelopes of each department/ministry for its schemes over the next five-year cycle. There are 54 CSSs and 260 CSs which have their terminal date of approval till March 31, 2026 and are likely to be submitted for re-appraisal.

A majority of these will also require fresh approval of the Cabinet.

Schemes cover a wide gamut from social sectors like health, women and child development, school and higher education, and tribal welfare to the agriculture sector, urban and rural infrastructure, water and sanitation, environment, scientific research etc.

The Department of Expenditure also stressed the quality and effectiveness of public expenditure, and in this context, highlighted that such exercise in the past had allowed the central government to enhance its budgeted capital expenditure substantially, which now stands at Rs 11.21 lakh crore for FY 2025-26.

The policy of evaluation of ongoing schemes and having a sunset date for each scheme was articulated by the government in the Union Budget Speech of 2016, which stated that in order to improve the quality of public expenditure, every scheme will have a sunset date and an outcome review.

Accordingly, the schemes have been aligned with the Finance Commission cycles, and their continuation is based on the evaluation of each scheme by a third party.

The government has been funding the development needs of the country through various CSSs and CSs.

While in the case of CSs, the government bears 100 per cent of the cost, in the case of CSSs, the scheme expenditure is shared in a predefined ratio between the central and the state governments.

It has been a constant endeavour of the Ministry of Finance to enhance the quality of expenditures made under schemes through contemporaneous design and architecture and better targeting.

The Development Monitoring Evaluation Organisation (DMEO) in Niti Aayog conducts an evaluation of the CSSs while the evaluation of the CSs is being conducted by third-party agencies selected by the ministry concerned.