Social Audits

For the past month or so I have been working on a report on the use of smartcards to disburse NREGA wages and pensions in AP. (For anyone interested, the report is in the final stages and should be released shortly.) As part of this research, I got the opportunity to travel to several areas in rural AP, visit a few NREGA worksites (though most are shut down this time of year), talk to several NREGA workers, and sit in on the public hearing in which results from a “social audit” of the functioning of NREGA in one mandal were released.

Before traveling to AP, I had read a lot about how AP’s ambitious system of state promoted social audits has led to reduced leakage and increased compliance in the implementation of NREGA. Our own limited experience in the field certainly confirmed these results: not a single person we talked to had been the victim of “skimming” of wages by either a post office employee (wages are typically delivered via post office savings accounts) or an NREGA field supervisor or had even heard of anyone having had a portion of their wages “skimmed.” Further, while some complained that the NREGA field supervisors did not properly inform them of the availability of work, we didn’t find anyone who had been completely barred from working at a worksite. Considering the common perception that post office employees often skim money from illiterate recipients of money orders and that GPs often refuse people NREGA work as it makes it more difficult for them to siphon off funds these results are pretty remarkable.

Yet while AP’s system of NREGA audits certainly seems successful, I had a hard time figuring out what exactly was “social” about the audit process other than the public hearing at the end. The audit was lead by trained auditors employed by a state level agency (the SPIU) who systematically gathered data on a random sample of workers using a standardized process. This all seemed a lot different from the concept of a “social audit” as defined in the NREGA legislation (the act itself defines a social audit to be one in which the gram sabha collects information on the functioning of all worksites in the GP) or from those audits I had read about in the press conducted by NGOs such as MKSS.

It may seem like I’m arguing over semantics, but I think the distinction is pretty important. If AP’s system of audits is successful as it appears, it’s important that we call a brick a brick and label the AP experiment in audits for what it actually is – an internal audit system led by a state agency with results released at local public hearings – so that we don’t make the mistake of attributing the success of the audit system to something which isn’t there.

In fact, it could very well be that it is precisely because the audits are led by state level officials that they are so successful. One thing I noticed during the public hearing of the audit is that the auditors and district officials went pretty easy on offenders as you might expect from government officials. GP officials caught siphoning funds were only told to pay them back. While some may criticize the mildness of the punishment, if punishments are meted out too severely auditors might meet a stone wall the next time they attempt to conduct an audit. Similarly, never were the mandal level or district level officials criticized. Again, this might not be ideal from a fairness perspective, but is important to ensure that other officials at these levels are not afraid of participating in audits in the future.