DoE to rationalise Central schemes; seeks inputs on clubbing, scrapping
The Department of Expenditure has launched its sweeping rationalisation drive to trim the number and financial outlay of Central Sector Schemes (CSs) and Centrally Sponsored Schemes (CSS), sources said.
“With the current five-year cycle for most schemes set to expire by the fiscal-end and the fresh approval cycle beginning April 1, the DoE recently held a meeting with various Ministries and Departments directing them to submit formal restructuring proposals. The idea is to club together similar schemes and end redundant ones wherever possible,” a source tracking the matter told businessline.
There are 54 CSSs and 260 CSs which have their terminal date of approval till March 31, 2026, per the government. The schemes cover wide-ranging sectors such as health, women and child development, school and higher education, tribal welfare to agriculture sector, urban and rural infrastructure, water and sanitation, environment, trade and scientific research.
“There are too many schemes currently and there is a need to consolidate,” the official said, noting that the government wants both Central Sector and Centrally Sponsored schemes to be rationalised and clubbed together wherever possible.
While the CSs are fully funded by the Union Government, in case of CSS, costs are shared with State governments.
“Many schemes will be up for approval for coming financial cycles. If there are schemes that are not working properly, and there is not enough outgo or expenditure, those should be identified. If such schemes have not got a good reception then these should be subsumed into others or even discontinued,” another source said.
In a previous meeting on rationalisation of CSS and CSs earlier this fiscal, the DoE had stressed upon the quality and effectiveness of public expenditure and in this context highlighted that such exercise in the past had allowed the Centre to enhance its capital expenditure substantially to ₹11.21 lakh crore for FY 2025-26 (BE).
It had said that convergence of schemes was needed for having a greater impact, eliminating duplication, attaching conditionalities to drive reforms and aligning the scheme objectives with the larger goal of India @100, the vision for India’s future as it approaches its 100th year of independence in 2047.
The Finance Ministry wants to sharpen the impact of this spending, focusing on modernising scheme architecture and improving “last-mile” targeting to ensure every rupee is utilised effectively.
“The Ministries will have to give their proposals on potential merging of schemes by March,” the official said. As per government policy, the Development Monitoring Evaluation Organisation (DMEO) in NITI Aayog conducts evaluations of the CSSs while the evaluation of the CSs is conducted by third-party agencies selected by the Ministries concerned.
Published on January 4, 2026
