The commission has been asked to suggest a roadmap for reducing functions, activities and administrative structures of the Central government, keeping in view the evolving role of the government and the need to avoid overlap of functions. The ERC is expected to review all subsidies, explicit and implicit, so as to maximise their impact on the target population at a minimum cost.

The commission will devise an effective strategy for cost recovery through user-charges, and suggest measures for effecting improvement and reducing budgetary support for government-funded autonomous institutions.