Rethinking the Social Auditing Movement in India's Fight Against Corruption

IHT: India's fight against corruption goes local

New York Times journalist Lydia Polgreen wrote an article on rural India "social audits", an experiment in the local grass-roots democracy that has been gaining momentum recently. Backed up by the recent right-to-information law she outlined how this movement could have "broad implications for India's quest to lift hundreds of millions of people out of poverty" in the country with the largest number of poor people in the world. She quoted V. Vasanth Kumar, Andhra Pradesh's minister for rural development as saying that "social audits statewide have found $20 million worth of fraud over the past five years, and 4,600 officials have faced administrative or criminal charges".

Former prime minister Rajiv Gandhi once estimated that only 15 percent of every rupee spent on the poor actually reaches them, which is a terrible statistic in the light of the Indian government's plans to spend a quarter of a trillion dollars to help the rural poor over the next five years, and such social audits are indeed crucial to reducing waste and fraud. Although Lydia has every right to be hopeful about such a movement, her article is written based on a "Western", anti-corruption perspective. Her idea of an effective democracy that India should work towards is that of an educated, information-rich model based on that of developed countries with long histories of understanding rights as well as relatively equal social statuses.

India's caste system however has been firmly entrenched for centuries, most significantly in the rural areas where mindsets have not altered at the expected pace. A social audit is a "Western" accounting process that assumes the ability to highlight and deter corrupt practices with the use of government funds by corrupted officials, but from a local perspective, that begets the question of the definition of "corruption". The image of "corruption", as often projected by the media and NGOs, portray a picture of a greedy official altering account records so as to embezzle government funds for personal gain. Such actions should rightfully be condemned and portrayed as such, social audit movements can only bring about greater benefit for the rural poor.

However in Indian society (as that of many Asian societies in general), the cultural emphasis on business and social networking has not been understood clearly by "Western" media and NGOs. The importance of entrenched hierarchies and guanxi relations has no monetary value that audits can valuate. The free market economy model assumes an equal standing between negotiating parties that is not reflective in reality, much less in caste-system India. Money exchanged under the table could be used to forge relationships with benefits far beyond what the amount is worth. For example, a village mayor might choose a less valuable construction proposition if along with it comes "unofficial" money that could be used for the development of education and sanitation facilities or increased probability of further ties with the company's partners that could translate into projects that provide jobs for the villagers.

If taken unawares, champions of social auditing might find themselves tools of certain politicians in the government searching for an excuse to rid themselves of rivals and uncooperative officials. With a history of networking and guanxi involved in every dealing, social auditing might become the most accessible way of "discovering" corruption and cronyism in between the lines of every accounting document.