SOCIAL AUDIT IN INDIA

SOCIAL AUDIT IN INDIA

Social audit is an accountability tool that measures, evaluates, identifies gaps in service delivery and rectifies the gaps with the direct participation of intended beneficiaries in this process.

Current Scenario in India

1. Statutory Status: Social Audits gained statutory status for the first time under the MGNREGA Act 2005, and shall establish an independent Social Audit Unit at state level.
2. Constitutional Amendment: 73rd Constitutional amendment act empowered Gram Sabhas to conduct social audits.
3. Government Schemes:
   • Pradhan Mantri Aawas Yojana-Gramin (PMAY-G) audits are done in Uttar Pradesh, Meghalaya, and West Bengal.
   • National Schemes: Eight States have taken up Social Audit of 11 different National schemes.
4. Government Assistance Programs: National Social Assistance Programme (NSAP) audits are done in Andhra Pradesh and West Bengal.
5. Legislative Action by States: Meghalaya Legislature has enacted a social audit law in 2017 which mandates social audit in different schemes in Education, Health, Rural Development, and other areas.
6. Judicial Activism: In 2017, the Supreme Court-mandated MGNREGS-like social audits under the:
   • National Food Security Act
   • Building and other Construction Workers Cess
   • Implementation of the Juvenile Justice Act.
7. CAG: The office of the CAG has directed social audits of local bodies’ schemes for better accountability of the effectiveness of fund allocation.
8. Society for Social Audit and Transparency: These have been set up in Andhra, Telangana, and Meghalaya as autonomous institutions that conduct social audits of the MGNREGS.
9. Jansunwai: In Rajasthan, the Mazdoor Kisan Shakti Sangathan workers spoke out about their issues with the bureaucracy, particularly about unimplemented programmes and deducted wages.
10. Social Audit Manual: Released by the Ministry of Rural Development which requires every State to set up an independent Social Audit Unit consisting of resource persons from the State, District, and Village.

Need for Social Audits

1. Need for Governments

• Social Welfare Focus: Social audits make governments accountable to the people for social welfare outcomes rather than just economic outcomes.
• Increases Democratic Depth: With public participation, democracy especially at the local level is strengthened.
• Accountability: Social auditing enhances good governance by strengthening accountability and transparency in local bodies.
• Checks corruption: Social audits identify the gaps and sources of leakages, thus reducing corruption by rectifying it. Example: In Andhra Pradesh, social audits have detected leakages to the tune of $24 million.
• Better Policy Formulation: By identifying pertaining issues and the state of social welfare, it helps governments come up with better future policies.
• Good Governance: It leads to responsible and accountable governance that seeks to eradicate instances of institutional malpractices.
• Helps in Developmental Goals: They highlight weaknesses and strengths and help in understanding the best way forward and achieving developmental goals.
• Monitoring: It is a helpful tool to aid the government’s presence and also for monitoring the progress of the schemes.
• Upholds Social Contract: A social audit helps the government perform their social responsibilities efficiently.
• Reduces Wastage of Public Funds: It saves funds and resources that were prone to pilferage and loss.
• Informed Decision Making: This allows state institutions to make better-informed decisions about the impact of their activities on stakeholders.
• Reduces Populism: Social audits reveal the reality of a situation, preventing unchecked fake poll promises.
• Break Down of Credibility: Various public institutions have lost credibility in recent years, leading to significant concerns about public trust.

2. Need for Citizens

• Empowerment: Empowers citizens through the participatory process of social audits.
• Enhances Social Capital: Enriches State-Citizen relationships and promotes credible societal harmony.
• Citizen-Centric Governance: Makes governments more accountable, transparent, and people-centric.
• Community Voice: Highlights the power of democracy through collective decision-making and participation in local progress.
• Integrated Development: Public voice raised through social audits results in development desired by both the state and the public.
• Social Harmony: Instills a sense of collectivism and reduces social differences.
• Social Upliftment: Amplifies marginalized voices and contributes to their development and upliftment.
• Inclusive Growth: Ensures equitable growth and development for all sections of society.
• Bridges the Rural-Urban Gap: Provides a clearer understanding of people’s aspirations and fosters responsible and equitable development.
• Grievance Redressal: A report by the Accountability Research Center has shown social audits play a significant role in addressing individual worker grievances.

Challenges

1. Issues with Government

• Non-Universal: Social audit mechanisms are not uniformly implemented in India; some states conduct them, while others do not. Currently, only eight states have undertaken social audits of 11 different schemes, including Pradhan Mantri Awas Yojana-Gramin (PMAY-G) and Swachh Bharat Mission (SBM).
• No Oversight Authority: There is no legal body overseeing the work and progress of social audits.

• Poor Follow-up: Social audits are being conducted as an exercise, however, action is not being taken on the findings. For example, 33% of respondents of an MGNREGA social audit in AP feel there is a weak response from the government.
• Lack of support from senior administration: 21% of social audit participants in AP and Telangana lack the support of senior officials [Accountability Research Center].
• Poor SAU Autonomy: The Social Audit units lack effective decision-making power in terms of spending funds and appointment of staff and officers.
• Lack of Data Integration: There are no proper databases and record-keeping mechanisms which can effectively be used for data analysis.
• Limited Scope: The Taskforce under CAG had reported that social audits were highly localized and covered only certain selective aspects.
• Lack of integration with local bodies: Social audit reports are either not prepared or not made available to gram sabhas in local languages.
• Policy Focus: Social Audits still form a very small amount of policy focus while creating and implementing schemes.
• Generalisation: The findings of social audits cannot be generalized over the entire population.
• Lack of stringent penalty: Flouting SA principles and norms does not attract any penalty or legal proceedings, making SA a toothless exercise.

2. Issues with Public

• Awareness: Most participants or non-participants do not know the true essence of such audits and their potential.
• Inequality: Many people are unable to participate in such exercises due to pressures of livelihood, migration, social status, and extreme poverty.
• Gram Sabha Legitimacy: Many Gram Sabhas have poor quorum and participation, making it difficult to implement such audits.
• Corruption: Many Panchayat heads are hostile toward this exercise due to a perceived threat to their hegemony.
• Gender Participation: In conservative areas, women are not educated enough or encouraged to express their opinions.
• No incentive to participate: There is a lack of interest among people regarding village activities due to their livelihood reasons.

3. Others

• Lack of Technical Integration: Digital and technical integration is poor, affecting proper data analysis.
• Influence of Crony Capitalism: Crony Capitalism can weaken reform-related activities through social audits for selfish interests.
• Lack of Incentive: There is a lack of incentive for both participants and those conducting the audit.

Way Forward

1. Institutional

• Standardisation: There is a need to institute social audit norms uniformly across India.
• Legal Mechanisms: Outcomes of social audits must have legal sanction, and state governments should enact specific rules for this.
• Providing more finances to SAUs: In 2012, the Ministry of Rural Development (MoRD) recommended 1 percent of expenses under MGNREGS for social audits, which was later reduced to 0.5 percent.

• SAU Autonomy: Social Audit units must have enough discretion to appoint staff and also spend funds for their functioning; sanction requirements delay the process.
• Punitive Framework: There must be punitive actions for failure to conduct audits or maintain records.
• Private Entities: It should be mandatory for private sector activities in development and public welfare areas. Example: Tata Steel was the first company to set up a social audit committee in 1979 for measuring its social performance.

2. Implementation

• De-politicization: There is a need to reduce political interference in the working of SAUs in terms of appointments and functioning.
• Civil Society: Integration of civil society resources is needed for education, awareness creation, and groundwork within SAU functioning. Example: Jharkhand has a formal mechanism involving civil society members in the SA panel.
• Integrated Management: The use of MIS to track details of schemes can streamline the lifecycle of program planning, implementation, and feedback.
• Regularity: Frameworks must ensure audits are conducted regularly, and the actions taken are monitored.
• Technology and Digitisation: There is a need to digitize records and data.
• Role of Media: Media should take proactive participation, reach out to rural areas, and spread awareness.
• Mainstreaming: Social audits should become mainstream and a norm in public work.

Best Practices