PCRs: evaluating how well state bodies perform
All non-commercial State Bodies under the aegis of a government department must undergo a Periodic Critical Review (PCR) every five years. This requirement was introduced in 2016 under the Code of Practice for the Governance of State Bodies1.
A PCR evaluates how well a state body continues to deliver against its original mandate, and how its activities have evolved over time.
Structured stakeholder consultation is the cornerstone of the PCR process and can deliver rich insights to support state bodies to enhance their operations and better serve the public.
Objectives of a PCR
Irish state bodies play a vital role in delivering a wide range of critical public services. These range from environmental protection to housing supply and professional regulation.
These organisations make a significant contribution to Irish society and government. There is, however, increased emphasis on ensuring they continue to deliver a high standard of services, and maintain the trust of citizens and communities.
A PCR is intended as a test of the ongoing business case for individual state bodies within the broader context of how the policy landscape may have evolved since the organisation was established.
Along with evaluating if the state body remains the appropriate vehicle to deliver its original objectives, the PCR also considers how the state body could achieve improvements in service delivery, accountability and value for money.
Furthermore, the PCR examines if robust and effective governance arrangements are in place.
A deep dive into the PCR process
The Guide to Periodic Critical Review of Non-Commercial State Bodies2 sets out the basic framework for the PCR process. This guide is published by the Department of Public Expenditure, NDP Delivery and Reform (DPENDR).
It stipulates a proportional approach, so the PCR is tailored to the size and remit of the body under review. Each PCR shares some common stages:
Scoping
Tailoring the PCR to meet the specific requirements of the sponsoring department.
Desktop research
Utilising materials such as relevant legislation and annual reports to provide further context on the organisation's strategy and activities.
Engagement with the State Body
Conducting interviews with non-executives and senior management to understand the organisation better.
Stakeholder consultation
Comparing and contrasting the views of various stakeholder groups through questionnaires, interviews and workshops.
Report drafting
Consolidating findings from research, engagement and consultation, and developing key recommendations for the state body.
While the specific areas covered vary based on the tailored scope of a review, they can include:
External environment
Examining how the State Body has adapted to changes in the broader landscape and the relevance of the original objectives in light of evolving policy priorities.
Organisational capacity
Evaluating whether appropriate governance arrangements are in place and the strength of the operational capabilities with the organisation.
Organisational performance
Assessing the effectiveness and efficiency of the organisation in delivering its statutory mandate, including its focus on achieving value for money.
Maximising the value of a PCR
PCRs offer a valuable learning opportunity to guide a state body’s growth and development. Rather than being a bureaucratic exercise, a PCR offers many strategic advantages, including:
1. Continuous learning
The PCR offers a structured approach to assessing which elements of the State Body’s activities are effective and should be retained, along with highlighting areas that can be strengthened or where better value for money could be delivered.
By adopting the learning mindset encouraged by the PCR, the state body’s leadership can transform the review from a periodic event to a strategic compass guiding the continuous improvement of the organisation.
2. Strengthening stakeholder relationships
Stakeholders play a central role in the process. The review team must think through how best to consult service users, employees, government departments and other relevant stakeholders as appropriate.
A PCR can facilitate improved relationships with key stakeholders as it gives them a valued opportunity to make their views heard. Stakeholder engagement can be used to build trust, foster collaboration and align everyone toward shared objectives.
3. Enhancing the relationship with government department
A typical PCR assesses relationships between the state body and its parent department, as well as other relevant government departments.
If appropriate, the PCR may suggest ways to enhance and strengthen these relationships, such as proposing more meaningful performance metrics or identifying areas where closer input and support from the government department might be needed.
4. Strengthening governance
A PCR offers a periodic stocktake of the state body’s governance structures and how these could be adapted to better serve the needs of the organisation, which are likely to have evolved over time.
The PCR can provide valuable insights, for example from benchmarking against international peers and reflecting on how the organisation may adopt global best practice in governance.
5. Opportunity to showcase good practice
The PCR is also an opportunity to highlight and raise awareness of the organisation’s key achievements and areas of high performance, and can strengthen stakeholders’ confidence in delivery. It can also help uncover and correct stakeholders’ misperceptions about the state body.
1 Code of Practice for the Governance of State Bodies
2 A Guide to Periodic Critical Review of Non-Commercial State Bodies
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At PwC, we’re experienced in supporting organisational reviews and can offer tailored advice to you based on our experience in this area.
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