Discretionary grants
Also called: Article 282 · Topic: Federalism and Centre-State Relations · NCERT: Class 11, Ch 7 "Federalism"
Meaning
Discretionary grants are grants made under Article 282. The Union or a state can give money for any public purpose. This is allowed even for a subject on which that government cannot make laws. The Finance Commission does not decide these grants, so the giver has wide freedom. The Union uses them to pay for centrally sponsored schemes. These are schemes the Union designs and funds, and the states carry them out.
Example
The Union funds a centrally sponsored scheme in school education and releases money to states through Article 282. Opposition-ruled states have often said such funds are given in a biased way or held back from them.
Don't confuse with
- Grants-in-aid (Art. 275): fixed grants made by law to states that need help, based on Finance Commission advice. Article 282 grants are at the giver's choice.
Related concepts
- Vertical fiscal imbalance
- Grants-in-aid
- Gadgil formula
- 101st Constitutional Amendment Act 2016
- Concurrent taxing power for GST