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Social Audit of MGNREGA

Social Audit

Social Audit is the examination and assessment of a programme/scheme conducted with the active involvement of people and comparing official records with actual ground realities. Social Audit is a powerful tool for social transformation, community participation and government accountability.

Section 17 of the MGNREGA has mandated Social audit of all Works executed under the MGNREGA. Social Audit is different from Financial Audit. Financial audits involve inspecting and assessing documents related to financial transactions in an organization to provide a true picture of its profits, losses and financial stability. Social audits focus on the performance of a programme in fulfilling its intended social objectives and ethical vision through consultation with a range of stakeholders including social programme beneficiaries, community members, government officials and verifying the information obtained with documents and physical evidence. Thus social audits examine and assess the social impact of specific programmes and policies.

The process of Social Audit combines people's participation and monitoring with the requirements of the audit discipline. It is necessary to promote people's participation in the audit along with support provided by an independent social audit organization that facilitates the process.

The Social Audit process is a factfinding process. The work of the Auditor is to investigate by cross-verifying facts and details in the records from the workers and cross- verifying works at site. The "Auditors" must not view themselves as "Prosecutors".

Benefits of Social Audit

  • It informs and educates people about their rights and entitlements.
  • It provides a collective platform for people to ask queries, express their needs and grievances.
  • It promotes people's participation in all stages of implementation of programmes.
  • It brings about transparency and accountability in government schemes.
  • It strengthens decentralised governance.

Key features of Social Audit

  • Fact finding not fault finding.
  • Opportunity for awareness building on entitlements and processes.>
  • Creating the space and platform for dialogue among various levels of stakeholders.
  • Timely grievance redressal.
  • Strengthening the democratic process and institutions.
  • Building people's pressure for better implementation of programmes.

Steps of Social Audit

  1. Social Audit Calendar: The Social Audit Unit (SAU) prepares the social audit calendar for the Gram Panchayat in the State.
  2. Selection of Village Resource Persons (VRPs): The VRPs are identified by the Social Audit Unit in each state. The VRPs should be drawn from the following groups:
    • Members of SHGs (preferably women members)
    • Worked under MGNREGA or have family members who have worked under the MGNREGA
    • Preferably women or persons belonging to the SC, ST, Notified Tribes, De-Notified Tribes/other marginalised groups
    • Youth from Rural Groups, Nehru Yuva Kendra, Bharat Nirman Volunteers
  3. Training of VRPs: The identified VRPs will attend the training programme on key aspects of MGNREGA, social accountability and social audit.
  4. Consolidation of records: The Block Office will provide all the required documents and the social audit team will cross check and verify these documents. They will ensure that all the records against the total expenditure are made available.
  5. Verification: The social audit team will cross verify the records with the beneficiaries and worksite as follows:
    • They will verify the documents received from the Programme Officer and the Gram Panchayat.
    • Through door-to-door verification, they will meet all the workers who have worked under MGNREGA during the financial year. They will check if the full wages have been paid to the workers.
    • They will visit all the worksites, take the measurements and check the quality of work. They will conduct 100% verification of all the executed work.
  6. Report Preparation: The social audit team collates all the findings and evidences from the verification stage and prepares an issue-wise social audit report for the Gram Sabha.
  7. Social Audit Gram Sabha: After the report preparation, the next step in social audit is to conduct a Social Audit Gram Sabha. The social audit team presents the findings from the verification stage to the people in the presence of an independent observer. The implementing agency needs to respond to the issues raised in front of the Gram Sabha.
  8. Public Hearing: The purpose of the public hearing is to ensure that the orders are issued on a public platform and actions are taken on the social audit findings. The officials from the implementing agencies need to be present and respond to the social audit findings, as well as the queries raised by people.
  9. Village Resource Persons: The Village resource persons serve as the most important link in the chain of the social audit process. They are the ones who perform the role of providing assistance to the community members enabling them to conduct a social audit of their Gram Panchayat.
  10. The following are the key functions of the VRPs during a social audit:

    • Verify whether MGNREGA wage seekers received all their rightful entitlements.
    • Verify whether assets created under MGNREGA were built as per the norms recorded.
    • Assess who is drawing benefits from the works created under MGNREGA and whether works were created keeping in mind the local development requirements of the GP.
    • Verify whether processes of implementation of MGNREGA in the GP were as per the provisions of the Act and its guidelines.
    • Ensure proactive disclosure of all information pertaining to MGNREGA to the residents of the GP in a manner that is easily understandable.

Dos of Social Audit

  • There should be a favourable environment building process before the social audit.
  • Awareness and simple (IEC) materials on entitlements should be circulated.
  • Be polite to workers and beneficiaries.
  • Introduce yourself before starting the interview/interaction or group discussion.
  • Honour the request of beneficiaries if she/he makes any.
  • Cross-check the information before coming to a conclusion (or writing the report)- cross verification is a must.
  • Publicly read out the evidence to the beneficiary before taking his/her signature.
  • Ask the people who have shared testimonials to come over to the public meeting to give their testimony in person, if possible.
  • Protect the safety and security of the beneficiaries who are interested to testify.
  • Make people aware about their rights and entitlements during the survey and during public meetings.
  • Take extra steps to ensure participation of vulnerable groups like SC, ST, NT, DNT, differently abled, single-woman headed households during the process.
  • Cover all villages and hamlets i.e. 100% verification needs to be done.
  • Maintain a neutral stand by interacting with various groups in the village instead of just the powerful ones (such as the sarpanch, ward members, secretary, gram rozgar sewak, mate and others).
  • As far as possible, try to stay in public buildings.

Don'ts of Social Audit

  • Don't force beneficiaries to sign any documents/testimonials.
  • Don't be judgmental.
  • Don't misuse other's records (for instance, borrowing a worker's job-card & not returning it). Don't take undue favours (hospitality and transport) from others during the process.
  • Avoid taking advantage from people in powerful positions.
  • Don't drink alcohol during the process.

Audit of Scheme Rules, 2011

The Audit of Scheme Rules, 2011 were prepared by MoRD in consultation with the Comptroller and Auditor General (CAG) of India. These rules are also called the Mahatma Gandhi National Rural Employment Guarantee Audit of Schemes Rules, 2011.These rules define the process of social audit and responsibilities of the Social Audit Unit (SAU), state government and the field functionaries of MGNREGA, to be followed across the country.

These rules also emphasize the role of the SAU, its pre-requisites, the process of social audit and the responsibilities of designated officials.

Social Audit Unit and its Role

The State Government shall identify an independent organisation as a Social Audit Unit to facilitate the conduct of social audit. SAU shall be responsible for the following:

  • Build capacities of Gram Sabhas for conducting social audit.
  • Identify, train and deploy suitable resource-persons from primary stakeholders to conduct social audit.
  • Prepare required reporting formats, resource materials, guidelines and manuals.
  • Create awareness amongst the wage-seekers about their rights and entitlements.
  • Facilitate verification of records with primary stakeholders and at the worksites.
  • Host the social audit reports including action taken reports in the public domain.

Social Audit Pre-requisites

  • The process of social audit shall be independent of any process undertaken by the implementation agency of the scheme.
  • The implementing agency shall not interfere with the conduct of social audit.
  • The implementation agency shall make all information/documents available to the SAU at least 15 days prior to the date of commencement of social audit.
  • The resource person deployed for facilitating social audit in a Panchayat shall not be a resident of the same Panchayat.

Process of Social Audit

  • SAU shall prepare an annual calendar of social audit for the state.
  • SAU shall deploy resource-persons to facilitate the conduct of social audit and verify
    1. muster rolls
    2. worksites
    3. cash book
    4. bank/PO account statement
    5. bills and vouchers and any other payment made from the fund of the scheme
  • Wage-seekers, workers and the village community will be informed about the Gram Sabha by the resource persons as well as the Programme Officer (PO) to ensure their full participation in it.
  • The action taken report (ATR) relating to the previous social audit shall be read out at the beginning of each Social Audit Gram Sabha.
    1. Present the social audit findings to the Gram Sabha. The social audit report will include findings of the
    2. verification exercise with workers and physical verification of the worksite b) utilisation offunds
    3. fulfilment of rights and entitlements of the wage-seekers and workers d) Transparency and accountability measures.
  • All elected members of the Panchayat and staff involved in implementing the scheme under the Act shall be present at Gram Sabha.They will respond to queries raised during the Gram Sabha.
  • District Programme Coordinator shall attend the Gram Sabha or nominate an official as an independent observer.
  • Social audit reports will be prepared in the local language.

Responsibilities of key officials in Social Audit

Key roles of the Gram Panchayat in MGNREGA implementation towards Social Audit:

  • Convening the Gram Sabha for planning and social audit
  • Making available all relevant documents for social audit such as:
    1. Muster rolls
    2. Bills and vouchers
    3. Other connected books of accounts and documents
    4. Measurement book
    5. Copies of sanction orders (both technical and administrative)
  • Proactive disclosures (in the GP office or main public spaces) including names of job-card holders, details of work (completed and ongoing) at WorkSite, wages paid, quantity and costs of materials along with supplier agencies.
Roles of other stakeholders
  • The Programme Officer will ensure that all the required information and records will be made available 15 days prior to the commencement of the social audit.
  • The state government is responsible to take follow-up action on the findings of the social audit.
  • The District Programme Coordinator will ensure that the state government takes corrective action on the social audit report.
  • The State Employment Guarantee Council will monitor the action taken by the State Government and submit the annual report to the State legislature.

Source : Village Resource Persons Training Manual for Social Audit of Managers



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