You can selectively delete files in iCloud Storage. If you choose to do so, you will get a dialog box warning you that if you delete that a file from iCloud, it will be deleted on all of your devices that are syncing files with iCloud.
In the Storage setting, you can only delete the entire app which will delete all local data associated with that app. It will not delete the data that is stored in iCloud so that if you download the app again, it will also download all of the data from iCloud.
For instance, if you use the Pages app and you delete it, all of the local data storage goes with it. If you download the app again, the documents that you had in Pages will download from iCloud again.
The obvious caveat to this is that you have to be using iCloud in the first place. If you were not using iCloud and not backing up at all, if you have files in Pages and you delete them, they are gone for good. The exception to that would be if you used file sharing with iTunes and store your files locally on your computer, you could delete the app, download it again and then transfer your files back from your computer to the device.