iPad storage vs. iCloud storage.

ICloud stores your device backup files, and otherwise it synchronizes data across devices. Other than your icloud backup file, everything you store in iCloud is also on your device, and any changes made to any of the information on the device is reflected in iCLoud and sync’d across your devices.

iCloud is not a substitute for your device’s built in storage. It stores copies of your data so you can keep it identical across multiple devices (e.g. contacts - your contacts on your iphone and iPad are identical because you sync them via iCloud).

You wouldn't need to use iCloud Storage for syncing if you only had one device. If you backup your device to iTunes, you wouldn't need iCloud Storage for anything.