23 Social Audit

Dr. Rajesh

Content Outline

1. Introduction.

2. Objectives.

3. Definition and Interpolation. 4.Principles of social audit.

5.Objectives of Social Audit.

6.Purpose of the Social Audit.

7.Salient Features.

8.Scope of Audit.

9.Applying the Tool for social audit.

10. Social Audit compared with other audits.

a) Government Audit or Institutional audit.

b) Public audit

11.When Social Audit is conducted?

a) Planning Stage.

b) Implementation Stage.

c) After completion of work.

12.How is it done?

a) Preparatory groundwork

b) Information gathering and analysis

c) Public disclosure and evidence-based dialogue

d) Follow-up

13.Benefits of Social Audit

14.Challenges and lessons

15. RTI and Social Audit

16. Control over Social Audit 17.Conclusion

Introduction

As a democratic nation and a Welfare State has evolved as the key development in the politics of 21st century,so Government takes any decision keeping the common people in mind so, it formulates many programme/policies for the welfare of the State Social responsibility and accountability are the need of the hour as people are becoming more conscious about their rights to be informed and to influence Government decision making processes,.AsGovernments are facing an ever-growing demand to be more accountable and socially responsible and the community is becoming more assertive about its right to be informed and to influence governments’ decision-making processes. Faced with these vociferous demands, the executive and the legislature are looking for new ways to evaluate their performance along with Civil society organisations which undertaking “Social Audits” to monitor and verify the social performance claims of the organisations and institutions. Though planning is perfect with all valid assumptions considering the immediate need of the people, there were few Programs in which ‘WE’, the people, find a huge gap between expected outcome and actual outcome. It is evident that there is some sort of deviation from the proper course of implementation and follow up. Where evaluation of social Audit proved to be worthy.

Objectives

After going through this unit the learners will be able to:

1. What is social Audit and how it is worthy?
2. Objectives,Principles and Scope of social Audit.
3. When and how is it done?
4. Challenges and Benefits of Social Audit.

Definition and Interpolation

“Social Audit is a process in which people work with the Government to monitor the planning and implementation of the policies/programme which are intended for the beneficiaries (people)”.It is also defined as an in-depth scrutiny and analysis of the working of any public utility vis-à-vis (in relation to) its social relevance The underlying ideas of a Social Audit are directly linked to the concepts of democracy and participation. In Social Audit, it examines the impact of specific Governmental activities on certain sections of the society which are in contact with Government agencies.

A social audit is a process by which the people (the final beneficiaries of any scheme, programme, policy or law), are empowered to audit such schemes, programmes, policies and laws. It involves both the service providers and the users examining the impact of the project or service in a systematic way comparing the real benefits that have accrued with the expected benefits, while also looking at unexpected impacts. It is an ongoing process by which the potential beneficiaries and other stakeholders of an activity or project are involved from the planning to the monitoring and evaluation of that activity or project. It thereby tries to ensure that the activity or project is designed and implemented in a manner that is most suited for the prevailing (local) conditions, appropriately reflects the priorities and preferences of those affected by it, and most effectively serves public interest. The findings of the social audit are shared with all stakeholders and where problems are identified, the process for implementing changes is initiated.

Social audits can take different forms and cover a range of actors and practices. They can be undertaken independently by CSOs/Community based organizations or jointly with the government. They often begin as civil society initiatives and at times evolve into collaborative and institutionalized efforts as the government realizes the benefits of the social audit methodology. In the context of state institutions, social audits supplement conventional financial audits to help government departments and public agencies evaluate their overall performance as a comparison between public perceptions and their stated core values and the scale and scope of social audits vary depending upon available resources, ranging from comprehensive national level to localized community audits. Social audits are sometimes undertaken as a once-off event but are usually more effective when undertaken at regular intervals as part of an ongoing process. Social audits use participatory techniques to involve all relevant stakeholders, particularly the traditionally marginalized or disadvantaged groups, in collecting and analysing evidence, providing feedback, and recommending changes where necessary.

When a community undertakes a social audit for the first time it is usually supported and assisted by an intermediary CSO in terms of training on the social audit process; help access the information required to conduct the social audit: assist in collating and

disseminating information to the community; document the social audit findings; and follow up with public officials regarding the proposed changes or remedial actions.

Owing to a growing realization that transparency and demonstration of trust contribute significantly to the success of a programme/project, even commercial firms, and international donor agencies and NGOs are using social audits as a means of assessing and improving their programmes and overall performance.

Principles of social audit

• Transparency: Complete transparency in the process of administration and decision making, with an obligation on the govt to proactively give the people full access to all relevant information.
• Participation: A right based entitlement of all the affected persons and not just their representatives to participate in the process of decision making and validation
• Representative Participation: In those cases where options are pre-determined out of necessity, the right of the affected persons to give informed consent, as a group or as individuals, as appropriate
• Accountability: Immediate and public answerability of elected representatives and government functionaries, to all the concerned and affected people, on relevant actions or inactions.

Objectives of Social Audit:

• Accurate identification of requirements
• Prioritization of developmental activities as per requirements
• Proper utilization of funds
• Conformity of the developmental activity with stated goals
• Quality of Service

Major decisions about these welfare programmes were made by the politicians. People’s money should not be played into the hands of few corrupted politicians hence there is a need for the social audit to check any discrepancies relating to the project/welfare activities. Social Audit is community driven tool for transparency and accountability. It unearths misappropriations, corruptions and identifies the perpetrators of such deeds and exposes them and makes accountable in the Public forum.

Purpose of the Social Audit

The purpose of conducting Social Audit is not to find fault with the individual functionaries but to assess the performance in terms of social, environmental and community goals of the organisation. It is a way of measuring the extent to which an organisation lives up to the shared values and objectives it has committed itself to. It provides an assessment of the impact of an organisation’s non‐financial objectives through systematic and regular monitoring, based on the views of its stakeholders.

Salient Features

The foremost principle of Social Audit is to achieve continuously improved performances in relation to the chosen social objectives. Eight specific key principles have been identified from Social Auditing practices around the world. They are:

• Multi‐Perspective/Polyvocal. Aims to reflect the views (voices) of all those people (stakeholders) involved with or affected by the organisation/department/programme.
• Comprehensive. Aims to (eventually) report on all aspects of the organisation’s work and performance.
• Participatory. Encourages participation of stakeholders and sharing of their values.
• Multidirectional. Stakeholders share and give feedback on multiple aspects.
• Regular. Aims to produce social accounts on a regular basis so that the concept and the practice become embedded in the culture of the organisation covering all the activities.
• Comparative. Provides a means, whereby, the organisation can compare its own performance each year and against appropriate external norms or benchmarks; and provide for comparisons with organisations doing similar work and reporting in similar fashion.
• Verification. Ensures that the social accounts are audited by a suitably experienced person or agency with no vested interest in the organisation.
• Disclosure. Ensures that the audited accounts are disclosed to stakeholders and the wider community in the interests of accountability and transparency.

Scope of Audit

Social audit is also conducted on Policies and Laws in addition to the schemes or programmes. The task of auditing is relevant right from the stage when an issue is identified through planning, implementation, monitoring and evaluation. Audits are done on not just of ‘decisions taken’ or the actions done (or not done) but also of the ‘processes followed’.

Applying the Tool for social audit

The six steps of Social Auditing are:

1. Preparatory activities
2. Defining audit boundaries and identifying stakeholders
3. Social accounting and book‐keeping
4. Preparing and using social accounts
5. Social audit and dissemination
6. Feedback and institutionalisation of social audit

The first two steps are critical when a department decides to incorporate social accounting, social book‐keeping and social auditing. The department needs to look at its vision, goals, current practices and activities to identify those that are amenable to social auditing purposes. Small work groups (say, seven persons) are to be formed which would spend about two days each to list down the social vision, core values, social objectives and map stakeholders and their involvement. Ensure involvement of various functionaries with due representation to gender, while forming small groups. The small groups should have access to project documents, process documentation, department guidelines and policy notes.

The next activity would be to assign the task of matching the activities with the social objectives and identifying gaps. This again could be carried out by a small group drawn from the managerial cadre and execution/implementation groups at the field level. All this information would be then looked into; to develop a plan for Social Auditing, including who would be responsible in the department, monitoring and identifying the resources required. This responsibility again could be given to a small group of three individuals.

Stakeholder consultation, involving department functionaries and civil society, would be the forum for sharing the Social Audit plan. This consultation would clarify the issues important for Social Auditing, role of stakeholders, as well as commitments from them. The outcome of the consultation would be fed into the process of detailing out: the indicators to be monitored; which existing records are to be used; and how additional information would be collected. The next key step is to fix responsibilities for various activities. The activities include preparing formats for social account‐keeping, compilation of data and reporting the same on a monthly basis (internal use). Managers of the department/programmes can use this information for monitoring as well as providing feedback for improving performance and overcoming bottlenecks.

Ideally, Social Audit should be conducted regularly, and the method should be developed through a participatory relationship between the auditor and the organisations/departments. The following figure depicts the detailed steps followed in the social audit cycle.

Social Audit compared with other audits:

Government Audit or Institutional audit:

Comptroller and Auditor General (CAG) who is the head of the Supreme Audit Institution of India, conducts Government Audit and it is also responsible for ensuring an uniform accounting policy and audit in Government sector as a whole.

Government Audit does not significantly involve the affected persons (ultimate beneficiaries). These audits concludes at assessing outputs rather than outcomes and are also not able to assess whether the decision making processes had the inputs and support of all the critical stakeholders (Government Personal, affected peoples and other interested parties).

Public audit

Public audit do not have those problems which being discussed above since it is audited only by the affected persons/stated beneficiaries. However the findings of discrepancy by this public audit cannot be easily taken to the table of the Government since, as the implementing institutions and Government does not involve intrinsically in the process of audit.

Social audit is a blend of two (Institutional audit and Public audit). It assesses the performance and unpacks decision. ‘Social audit’ targets whether the spent amount for the Social activity has made a difference whereas ‘Financial audit’ target whether the amount spent correctly for the specified activities. So Social Audit complements well with Financial  Audit.

Social audit is conducted in addition to Government/Institutional audits in some sample activities which involve distributing of disaggregated benefits at grass root level/activity which involves huge investment like; Public Distribution System (PDS), National Rural Employment Guarantee Scheme (NREGS). The findings of such audit are publicly compared to those of the Government/Institutional audits and the corrective/rectifying measures would be initiated.

When Social Audit is conducted?

Social audit can be conducted at any point of time of the Social activity. It might be of the grass root planning stage/implementing stage or after work being done.

Example:

It is broken down below taking NREGS (National Rural Employment Guarantee Scheme) specifically to give clarity as to what is being done in a Social Audit

Planning Stage:

To ensure that the Gram Panchayat plan is need based covering productive/investments and drawn up in consultation with community serving the poor and the disadvantaged. Preparation Stage: To ensure that estimates are proper and are in tune with the approved quantumo fwork.

Implementation Stage:

To ensure that wages are paid rightly, properly   and   to right people

after completion of work:

To ensure that quality  of work is in  tune with  quantity  and estimated cost.

How is it done?

Social audit practices use various techniques and methodologies since they are shaped by the nature of a given program or service being audited. The basic ingredients of social audit methodology are:

Preparatory groundwork

• Define the scope of the audit such as for e.g. a specific service, organisation, programme, project, a component or activity of a particular project and so on.
• Form a committee or working group to plan, implement and oversee the social audit.
• Identify key stakeholders such as intended users/beneficiaries, community members, local CSOs, service providers, responsible government officials, employees, contractors, volunteers, donors, etc.
• Develop a clear understanding of relevant administrative structures and pinpoint key responsible agencies/actors.
• Develop a clear understanding of the vision and objectives of the service/project being audited.
• Develop performance indicators through stakeholder consultation.
• Organise a public awareness campaign about the aims and benefits of the social audit using the media, public forums, door-to-door visits, etc.

Information gathering and analysis

• Access relevant public documents such as accounting records, cash books, wage rolls, bills and technical project reports and managerial records. Efforts must be made to obtain original documents rather than second-hand reports which may not be accurate.
• Gather data from relevant stakeholders about their perceptions and experiences of the service/project in question through surveys, focus group discussions, community meetings, and so on.
• The process of information gathering can also serve to inform key stakeholders and community members about the issues at hand and to mobilise public pressure and action for change.
• Analyse the gathered data which may require some specialised assistance.

Public disclosure and evidence-based dialogue

• Develop a communication strategy to disseminate findings and outcomes using the media, public meetings postings etc.
• Convene meetings with community members to discuss the findings and formulate proposed changes/solutions.
• Convene public dialogue meeting(s) to allow community members to discuss the evidence with authorities or service providers, and to plan and implement changes.

Follow-up

• Use the social audit findings to undertake advocacy to address specific instances of mismanagement and corruption as well as broader policy issues.
• Train and support community members and service providers to undertake further social audits.
• Make efforts towards institutionalizing social audits within the governance structures or to get the government’s commitment for conducting regular audits.

Benefits of Social Audit

• Raises public awareness and knowledge;
• Promotes citizen empowerment and strengthens community voice by allowing community members to provide feedback, gather evidence, interpret findings and develop solutions;
• Promotes local democracy and collective decision-making;
• Enhances policy-makers’ understanding of stakeholder concerns and encourages them to take steps to address the same; and
• Can lead to improved design and delivery of programs and services.
• When institutionalised, social audits allow for regular monitoring of public institutions, enhancing the legitimacy of state actors and enhancing the trust between the citizens/CSOs and the government.
• Social audits can also contribute to enhanced transparency by creating demand for information and even facilitating legislation on Right to Information in service delivery planning and implementation.
• Curb on corruption
• Increased effectiveness of a Program / Project
• A sense of belonging (Personal touch with People, since people participate in the audit)
• Awareness to Common people their rights and entitlements
• Social Accounting and Reporting
• Promotes integrity and a sense of community among people.
• Good Local Governance
• Grievance redressal and follow up of corrective actions

Challenges and lessons

• The implementation of a social audit by the community or local CSOs may require substantial technical support particularly in obtaining and analysing the data often necessitating external funding.
• Access to public records is crucial for a social auditing process. Obtaining records may often depend on the intervention of sympathetic officials. In the longer term, overcoming this obstacle may involve lobbying with the government to introduce legislation granting citizen access to public records.
• In situations where the non-existence of accurate public records is a problem: social audits can focus on user feedback and advocate for improved recordkeeping over time.
• Service providers and policy makers may feel threatened by the social audit process. If possible, it is useful to engage them constructively from the very outset and to attempt to direct criticism at institutions rather than individuals.
• Social audits, if not handled sensitively, can inflame emotions and can potentially lead to conflict or retribution from those who are “exposed”. It is prudent to foresee the potential need for conflict management and to remind all participants that the primary goal is not to assign blame but to bring about improvements.

RTI and Social Audit:

To conduct Social Audit it needs all relevant information and decision making processes that are totally transparent. Section 4(1) (b) of the RTI Acts (Right to Information) lists the information that Public authorities need to make public suo moto. It should publish all relevant facts while formulating important policies or announcing the decisions which affects the public. Thereby RTI Acts helps to conduct audit in a smooth manner.

Control over Social Audit

• No official/ political pressure should be brought on to social audit process.
• All records pertaining to works that are to be audited must be available with the social audit team before Audit process begin.
• The role and responsibilities of Government/Administration and the Social audit team should be clearly explained.
• The purity of the Social audit must be maintained at all circumstances. It should not be politicized.
• A Social auditor shall not bring his/her personal or organizational ‘s agenda into the social audit process
• All the aspects of the scheme must be closely examined during the social audit process
• There should not be any place for discrimination in Social audit process based on caste, race, religion or profession.
• A social auditor must be an impartial observer of facts.

Conclusion

The key to successful Social Auditing is in knowing which techniques to use and in what sequence. The Social Auditor can choose different methods so as to capture both quantitative and qualitative information from the respondent.

It is equally important to ensure the follow‐up action taken on the Social Audit report and the receptiveness of the departments/organisations to adopt the recommendations in the Social Audit report. The social auditors should suggest modalities for improving its performance based on the feedback received from different stakeholders. The detailed work plan needs to be identified by the social auditors and the same should be implemented at the earliest.