Social Audit

If Citizen’s Charter defines what the government promises, and Sevottam explains how the government should deliver, then Social Audit answers a far more powerful question:
👉 Did the programme actually make a difference on the ground?

In that sense, Social Audit is the voice of the people in governance.

What is Social Audit?

A Social Audit is a process in which details of public resources used for development programmes are shared openly with people, usually on public platforms like Gram Sabhas, allowing beneficiaries to verify, question, and evaluate outcomes.

Simply put:
👉 Social Audit = Public scrutiny of public expenditure by the public themselves.

Social Audit measures the social accountability of an organisation, not merely its financial propriety.

It gained particular importance after the 73rd Constitutional Amendment Act, which strengthened Panchayati Raj Institutions (PRIs) and grassroots democracy.

How is Social Audit different from other audits?

Audit Type	Focus
Financial Audit	Recording, processing, and reporting of financial data
Operational Audit	Measuring efficiency and performance against standards
Social Audit	Assessing social impact and outcomes based on stakeholder feedback

A financial audit checks whether money was spent correctly.
A social audit checks whether money was spent meaningfully.

Unlike conventional audits, social audit looks at → Ethics, Labour conditions, Environment, Human rights, Community impact, Social justice

Evolution of Social Audit in India

Early Beginnings (1979)

• The first instance of a social audit in India was conducted by Tata Iron and Steel Company Limited (TISCO) in Jamshedpur.
• Initially, social audits were used to assess corporate social accountability rather than government programmes.

Grassroots Mobilization and RTI Integration (1990s)

• The Mazdoor Kisan Shakti Sangathan (MKSS) initiated Jansunwai (public hearings) in Rajasthan.
• These public hearings linked social audit with citizen participation.
• RTI emerged as a critical enabling tool for social audits, captured in the slogan:
  “Hamaara paisa, Hamaara hisaab.”

Constitutional and Policy Endorsement

• The 73rd Constitutional Amendment empowered:
  • Panchayati Raj Institutions (PRIs)
  • Gram Sabhas
    to conduct social audits at the grassroots level.
• The Approach Paper to the 9th Five Year Plan (2002–07) reinforced the role of social audits in local governance monitoring.

Legal Mandate under MGNREGA (2005–2006)

• The MGNREGA Act, 2005 made regular social audits mandatory.
• Objective → Ensure transparency and accountability in rural employment programmes.
• Kerala became the first state to conduct a complete social audit of MGNREGA schemes.

Expansion into National Missions and Sectors

• National Rural Livelihoods Mission (NRLM), 2011 incorporated social audits to empower marginalized communities.
• Gradual expansion into sectors such as → Health, Education, Infrastructure

Institutionalization and Legal Backing

• Several states created dedicated social audit units within government departments.
• Meghalaya enacted a specific law making social audits a formal governance mechanism across multiple programmes.

Technology and Civil Society Involvement

• Adoption of digital tools such as:
  • Mobile applications
  • Online platforms
• Improved data collection, transparency, and accessibility.
• Civil society organizations (e.g., SAFAR in Rajasthan and Bihar) played a key role in:
  • Mainstreaming social audits
  • Promoting citizen oversight in governance

Need for Social Audit

Since Independence, huge public funds have been spent on social development programmes. However, the impact on the ground often did not match the investment.

The Core Problem

• Governance focused heavily on the SUPPLY SIDE
  (schemes, funds, guidelines)
• Neglected the DEMAND SIDE
  (people questioning, monitoring, and demanding accountability)

Strengthening supply-side systems is slow and long-term.
Strengthening the demand side can produce faster and deeper governance improvements.

How to Strengthen the Demand Side?

1. Institutionalising Social Audits
2. Empowering Gram Sabhas – the closest institutions to beneficiaries

👉 Social Audit converts beneficiaries from passive recipients into active watchdogs.

Principles of Social Audit

Globally, Social Audit rests on eight key principles:

1. Multi-perspective (Polyvocal)
Reflects views of all stakeholders, not just officials

2. Comprehensive
Covers all activities and impacts of the organisation

3. Participatory
Encourages direct participation of beneficiaries and community members

4. Multidirectional
Feedback flows both ways – citizens to state and state to citizens

5. Regular
Conducted periodically to embed accountability into organisational culture

6. Comparative
Enables comparison across → Time, Regions, Organisations

7. Verified
Audited by independent persons or agencies without vested interests

8. Disclosed
Findings are made public for transparency and accountability

👉 These principles rest on a foundation of democratic values, legal backing, administrative openness, and social awareness.

Significance of Social Audit

Social Audit plays a transformative role in governance, especially in social sector programmes.

Key Benefits

• Enhances Institutional Credibility
  Helps legislature and executive identify gaps and correct them proactively.
• Alerts Policymakers to Ground Realities
  Anticipates citizen concerns before they escalate.
• Promotes Positive Organisational Change
  Identifies concrete improvement goals and tracks progress.
• Strengthens Accountability & Transparency
  External verification reduces leakages, corruption, and wastage.
• Re-orients Policy Priorities
  Aligns programmes with people’s actual needs.
• Builds Confidence in Neglected Sectors
  Encourages action in areas earlier ignored due to uncertainty or fear of failure.

Indian Experience

With increasing devolution of funds and functions to local governments, demand for social audit has grown.

• In flagship schemes like MGNREGA, social audit is a mandatory accountability mechanism
• States like Rajasthan and Andhra Pradesh have institutionalised social audits through:
  • Gram Sabhas
  • Independent Social Audit Units
  • NGO partnerships

Limitations of Social Audit

Despite its potential, Social Audit faces several challenges:

• Highly localised scope
• Often sporadic and ad hoc
• Informal and weak monitoring mechanisms
• Findings cannot always be generalised
• Programme-specific data challenges (e.g., migration in adult literacy)
• Need for convergence across sectors (health, water, nutrition, sanitation)
• Shortage of trained social auditors
• Poor follow-up and action on audit findings

👉 Without institutional backing, social audits risk becoming symbolic rather than transformative.

Strengthening Social Audit in India

Enhance the Legal and Institutional Framework

• Model Social Audit Law
  • Enact a national law based on Meghalaya’s Social Audit Law, 2017.
  • Mandate audits of public services and strengthen community participation.
• Independent Audit Units
  • Establish autonomous social audit bodies with adequate staff and resources.
  • Example: Andhra Pradesh’s SSAAT model.
• Support CAG and PRIs
  • Strengthen the role of the Comptroller and Auditor General (CAG).
  • Enhance capacity of Panchayati Raj Institutions to manage audits.

Empower Stakeholders

• Public Awareness and Training
  • Conduct awareness campaigns for Gram Sabha members.
  • Provide training to social auditors on audit procedures.
• NGO and Media Involvement
  • Partner with NGOs.
  • Engage media to amplify findings and improve accountability.
• Incentives
  • Recognize and reward active participants to encourage wider engagement.

Standardize and Digitize Audit Processes

• Online Access and Transparency
  • Create platforms for public access to:
    • Social audit reports
    • PRI records
• Proactive Disclosure
  • Ensure government agencies release relevant information in advance.
• Unified Guidelines
  • Adopt standardized audit methodologies across sectors for consistency.

Adopt and Scale Best Practices

• Chhattisgarh
  • Integrates social audits with grievance redress mechanisms.
  • Uses wall writing to enhance transparency.
• Karnataka
  • Ensures auditor neutrality by rotating audit teams every three cycles.

Way Forward

To make Social Audit a core pillar of governance, the following steps are essential:

• Capacity-building of Gram Sabha members through education and awareness
• Strengthening institutional capacity at:
  • PRI level
  • Block level
  • DRDA level
• Supporting credible NGOs as catalytic agents
• Making media more rural and development-oriented
• Recognising and rewarding community members who strengthen accountability
• Creating a robust institutional framework for:
  • PRI accounting audits
  • Social audits
  • Online disclosure of findings
• Promoting proactive disclosure of information to enable meaningful audits

Conclusion

• Social Audit is a demand-side governance reform
• It deepens participatory democracy
• It complements financial and administrative audits
• Its true strength lies in institutionalisation and follow-up

👉 Remember this line for answers:
“Social Audit transforms beneficiaries into auditors and governance into a shared responsibility.”