Rural employment scheme social audits marred by delays

In four States, auditors’ wages delayed as funds from Centre are yet to arrive

Updated - September 13, 2022 11:47 pm IST

Published - September 13, 2022 10:49 pm IST - New Delhi

The original MGNREG Act had provisions for social audit, though the auditing standards were laid down by the Comptroller and Auditor General were issued only on December 19, 2016. Photo:

The original MGNREG Act had provisions for social audit, though the auditing standards were laid down by the Comptroller and Auditor General were issued only on December 19, 2016. Photo:


The Union Rural Development Ministry (MoRD) has told States that failure to carry out social audit of the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) will invite action, including withholding of funds. However, it is the Centre that bears the administrative cost of these Social Audit Units, and inordinate delay in the release of funds has left many of these cash-strapped units nearly paralysed. 

According to the report titled ‘Social audit calendar vs audits completed’ released on September 13 by the MoRD, only 14.29% of the planned audits have been completed in this financial year. 

The Hindu made enquiries in four States — Kerala, Telangana, Himachal Pradesh, and Chhattisgarh, which are ruled by both the BJP and Opposition parties. The Social Audit Units of these States had not received the administrative funds that the Centre owes them, and whatever little has come about has been delayed. Because of this, in Kerala, Himachal Pradesh and Chhattisgarh, auditors’ wages have been delayed by three months to one year. 

The original MGNREG Act had provisions for social audit, though the auditing standards were laid down by the Comptroller and Auditor General were issued only on December 19, 2016. According to them, every Social Audit Unit is entitled to funds equivalent to 0.5% of the MNREGA expenditure incurred by the State in the previous year. The audit involves quality checks of infrastructure created under the MNREGA, financial misappropriation in wages, and checking for any procedural deviations. 

This fund is released by the Centre in four tranches. The BJP-ruled Himachal Pradesh, for example, received ₹1.30 crore — the first instalment of this financial year — only last week. This is against a ₹4 crore liability this year and an additional ₹4.5 crore liability of the previous year. This amount was credited after desperate calls from the Audit Department, which was unable to pay its auditor for over a year.

Congress-ruled Chhattisgarh also has a remarkably similar story with the Centre’s dues piling up to ₹9 crore.

In Kerala, too, for the last five to six months, the auditors were not paid because the funds were not forthcoming from the Centre. Even when the funds arrive, the Centre rarely pays the entire amount. In the last financial year, out of ₹20 crore that the Centre owes, only ₹4 crore was sent to Kerala, and this year, out of ₹18 crore liability, as of now, only close to ₹3 crore has been received. “The delay in disbursement of funds leads to near paralysis. Since we are unable to pay salaries for the auditors, there is a high attrition rate. We obviously cannot force them to travel to distant villages on their own without actually paying them,” Kerala Social Audit Director M. Ramakantan told The Hindu

According to the findings of a periodic report on social audits by the non-profit People’s Action For Employment Guarantee, released last month, eight State Social Audit Units in 2020-21, and nine in 2021-22, have received less than half of the fund to which they are entitled. At least six States — Maharashtra, Jharkhand, Uttarakhand, Bihar, Chhattisgarh, and Karnataka — received their share of funds from the MoRD over a year ago, in 2021.

In the peculiar case of Bihar, the Bihar Social Audit Unit has not received any funds since 27th April 2020 – since more than two years. Moreover, none of these states have got their full quota of funds. Three state- Maharashtra, Bihar, and Chhattisgarh received zero funds in 2021-22 to conduct social audits despite their collective expenditure of more than ₹6,000 crore in MGNREGA in FY 2020-21. The Social Audit Units in Jharkhand, Nagaland, Tamil Nadu, Telangana, and Karnataka were forced to take loans from their respective State governments in order to sustain their operations. Rural Development Secretary Nagendra Nath Sinha agreed that there have been delays in the disbursement of funds to a “few States”, though he said, the problem is limited to the ongoing financial year, because of the recent overhauling of the Public Finance Management System but it will be streamlined soon, he assured. 

“The Social Audit Units were formed to check corruption in the MGNREGA implementation. To ensure their autonomy, they were to be funded by the Centre and not the State. Now, if our auditors are not paid, how will they fund their travel and meals? We are opening the doors to corruption simply by delaying their wages. And by forcing the Social Audit Units to take loans from State governments, the Centre is also asking us to surrender our autonomy,” the Director of a Social Audit Unit said on the condition of anonymity. 

This has to be seen in the backdrop the Ministry’s repeated reminders, the latest of which went out on August 5, directing the States to conduct social audits. Union Rural Development Minister Giriraj Singh has repeatedly said that if social audits are not conducted, MGNREGA funds to the States will be withheld.

Also Read | Revoke restrictions on MGNREGS works: Minister

Nikhil Dey, founder-member of the NGO Mazdoor Kisan Shakti Sangathan, said that the Union government was using the social audit as an excuse. “Under no circumstance should the funds be withheld from the people who work. Yes, we need to have a social audit, we need to ensure transparency. But if it’s not done, the worker who stands at the very end of the line should not pay for it,” Mr. Dey said. He alleged that the government does not care really about social audits because if it did, it would not delay the funds. “One way or the other, the government is using different excuses to cut MGNREGA outlay,” Mr. Dey said.  

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