The limits of constitutionality? Centrally Sponsored Schemes in law and policy

ABSTRACT This paper examines Centrally Sponsored Schemes (CSS) as a means of Union-State fiscal transfers in light of Article 282 of the Constitution. CSS are programmes designed and funded by the Union government on subjects in the State and Concurrent Lists, to be implemented by various State governments. In this paper, I argue that CSS permit the Union to exercise a high degree of control over the use of finances by the States. In effect, therefore, the Union’s spending power to frame CSS can intrude on States’ powers to frame and execute programmes on subjects that ought properly to be in their exclusive competence. I argue that even though CSS are constitutional under Article 282, they nevertheless have important practical consequences for Indian federalism