"The Union Cabinet has approved the proposal to merge CCS", Information and Broadcasting Minister Manish Tewari told reporters after the meeting.
Last month, a Group of Ministers, headed by Agriculture Minister Sharad Pawar, had approved merging of 147 CSS into 70 schemes.
The ministerial panel had approved setting up of a flexi-funds system in each scheme, under which state governments can use 10 per cent of the Budget allocated for CSS within the broader framework of the flagship programme.
For better utilisation of funds under CSS, the panel of ministers had approved transferring of funds from the central government to the state consolidated funds and not directly to the implementing agencies.
The merger proposal was in line with the recommendations of the Chaturvedi committee, which had suggested bringing down CSS to 59 from 147 to avoid overlap.
The GoM on restructuring of CSS was constituted to iron out differences among ministries like Agriculture and Tribal Affairs, which wanted to maintain some of the schemes for development of the sector.
Concerned over proliferation of CSS, Finance Minister P Chidambaram in his Budget speech had announced that "the schemes will be restructured into 70 schemes. Each scheme will be reviewed once in two years".