Social audit

It is a process which allows end users to scrutinize the impact of developmental programs.

● The concept gained significance after the 73rd Amendment of the Constitution.

● A social audit helps to narrow gaps between vision/goal and reality, between efficiency and effectiveness. It is a technique to understand, measure, verify, report on and to improve the social performance of the organization.

● It is a way of measuring, understanding, reporting & ultimately improving an organization’s social & ethical performance i.e. it serves as an instrument for the measurement of social accountability of an organization.


Social Audit in India

● National Rural Employment Guarantee Act, 2005 provides for regular “Social Audits” so as to ensure transparency and accountability in the scheme.

● The State Government shall identify or establish, under the NREGS, an independent organization, Social Audit Unit (SAU), at the state level, to facilitate conduct of social audit by Gram Sabhas.

● In April 2017, Meghalaya became the first State in the country to pass a social audit legislation, the Meghalaya Community Participation and Public Services Social Audit Act. 

Social Conscience is fast eroding, trust credibility, confidence, with respect to Government Projects are in crisis. Thus, Social Auditing is required for:-

1. Accurate Identification of Requirements.

2. Prioritization of Development activities.

3. Proper utilization of Funds.

4. Quality of Service.

5. Conformity of Development activity with State Goals.

Eight specific key principles have been identified from Social Auditing Practices around the World: 

1. Multi‐Perspective: Aims to reflect the views (voices) of all those people (stakeholders) involved with or affected by the organization / department / programme.

2. Comprehensive: Aims to (eventually) report on all aspects of the Organizationʹs work and performance.

3.Participatory: Encourages participation of stakeholders and sharing of their values

4. Multidirectional: Stakeholders share and give feedback on multiple aspects.

5. Regular: Aims to produce social accounts on a regular basis so that the concept and the practice become embedded in the culture of the organization covering all the activities.

6. Comparative: Provides a means, whereby, the organization can compare its own performance each year and against appropriate external norms or benchmarks.

7. Verification: Ensures that the social accounts are audited by a suitably experienced person or agency with no vested interest in the organization.

8. Disclosure: Ensures that the audited accounts are disclosed to stakeholders and the wider community in the interests of accountability and transparency.

Need of Social Audit:

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1. Reduces corruption: SA uncovers irregularities and malpractices in the public sector and maintains oversight on government functioning, thus reducing leakages and corruption.

2. Monitoring and feedback: It monitors social and ethical impact of an organization’s performance and provides feedback on the work.

3. Accountability and transparency: SA ensures accountability and transparency in working of local government bodies and reduces trust gap between people and local governments.

  • According to the MGNREGA Social Audit Report of 2020, close to 3 lakh cases of financial misappropriation amounting a total of Rs 658 Crore, combining audits of both 2018-19 and 2019-20 were identified. 60 percent of these financial misappropriation cases pertain to issues of payment to persons who did not work under NREGA.

4. Participative and democratic: SA promotes participation of people in implementation of programmes and makes people more forthcoming for social development activities.

5. Strengthens the Gram Sabha: SA gives voice and influencing power to the Gram Sabha, the lynchpin of rural governance structure.

6. Collective platform: SA provides a collective platform such as a social audit Gram Sabha, for people to express their common needs, resulting in social cohesion.

Challenges of Social audit: 

  • Lack of Infrastructure at ground level to address grievances made by the public during scrutiny.
  • Lack of administrative and political will in institutionalizing social audit mechanisms.
  • Lack of stringent penal action against those creating hurdles in the process.
  • Lack of educated and well-informed citizenry to undertake regular audits.
  • Lack of technical and managerial capacity such as book-keeping, accounting.
  • Unwillingness of public officials at ground level to share the reality of developmental process.
  • Lack of uniform process of social audit across states due to language and cultural barriers.
  • No Benchmarking of Social Audit Mechanism for comparison purposes across districts.
  • Difficult to gauge social impact assessment of government programs without any uniform or fixed criteria.  
  • For state officials, it is a time-consuming exercise – hence the need for special officers at village level only for the purpose of Social Audit.  


1. Director and staff selection: The selection of Directors of SAUs should be free of political control and the selection process should be strictly followed.

2. Support of implementing agencies: Rules must be framed so that implementation agencies are mandated to play a supportive role in the social audit process and take prompt action on the findings.

3. Legally sanctioned outcomes: Outcomes of social audit must have legal sanctioned state governments should enact specific rules for this.

4. Increased frequency: Social audits must be conducted in every Gram Panchayat once every 6 months.

5. Using Management Information System (MIS): Usage of MIS to track details of schemes at all levels to streamline the life-cycle of programme planning, implementation and feedback.

6. Refurbishing social audit process by: Convening the Gram Sabha at a neutral place and not in the village of the head of the panchayat; Meeting to be chaired by an elderly member who is not a part of Panchayat; Putting the resolutions and decisions to voting; Video recording of the meeting and uploading the Social Audit Reports (SAUs) on the government website in local languages.

7. Displaying Information of Notice Board: Gram Sabha should demand from the Panchayat, display of all the information, on Panchayat notice board from time to time, about the works being carried out or planned in near future.

8. Civil society participation: People including students from different universities should be encouraged to participate as Village Resource Persons. Example, Jharkhand has instituted a formal mechanism by inviting prominent civil society representatives to be part of the SA panel.

Case Studies:

Society for Social Audit, Accountability and Transparency, an autonomous body insulated from government interference, was set up in Andhra Pradesh. The state of Andhra Pradesh has become a role model for all the other states as far as implementation of Social Audit is concerned. It has been able to significantly improve performance of schemes like MGNREGA, PDS etc.

The Mazdoor Kisan Shakti Sangathan (MKSS) conducted social audits of daily wage earners and farmers on government projects, and more generally, to expose corruption in government expenditure in Rajasthan. They found various irregularities in finance which resulted into right to information movement in Rajasthan.

Way Forward  

Social audit as a transparent, participatory and active evaluation process has the potential to encounter the corruption that plagues anti-poverty programs. Thus, as a step towards good governance, social audit’s concepts, approaches, strategies and adaptable methodologies need to be propagated and percolated.  CAG should develop mechanisms to conduct social audit of public welfare schemes.

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