Latest news with #NationalAuditOffice
Daily Mail
3 hours ago
- Business
- Daily Mail
Will British holidaymakers have to pay more than £120 for a passport? Officials say the cost of renewing travel documents should RISE
British holidaymakers could see a major rise in the cost of renewing their passports under plans put forward by government officials. The National Audit Office says that the current £94.50 cost of a new travel document should increase because the Passport Office is losing so much money. The department, which has been credited with reversing a huge backlog of delays in issuing new passports, has racked up a deficit of almost a billion pounds over the past five years, including £223million last year alone. The NAO argued that without increasing the one-off payment made every 10 years taxpayers more generally would have to cover the shortfall. It did not give a figure for the rise but the Telegraph suggested it would have to rise £32 to £126.50 to recoup the lost money. A Home Office spokesperson said there were no 'immediate plans' to increase fees and any changes would almost certainly not come into effect this year. But it would be an additional financial burden for Britons at a time when the cost of living remains high. Gareth Davies, head of the National Audit Office said: 'Government bodies provide important services for the public and businesses, including issuing passports and driving licences, and filing company information. 'But many are not consistently recovering their costs - posing risks to the financial resilience of these services and fairness between users. 'HM Treasury should strengthen how it oversees cost recovery processes and provide more comprehensive guidance to charging bodies.' The cost of renewing passports has already risen significantly in recent years. The department drastically hiked prices for adult passports in February 2023 - from £75.50 to £82.50. Fees then rose again by 7 per cent last year - before an inflation-busting increase of 6.7 per cent in April to the current level for digital renewals. Renewing an adult passport using a paper form already costs £107, while fast track services will get you your passport in a week for £178 or a day for £222. The Home Office previously said the new fees were necessary to ensure the cost of passport operations is met without relying on taxpayer funding. It added that fees help cover passport processing, consular services for lost or stolen passports, and border operations. Nearly seven million new passports were issued last year. Adult passports are valid for ten years, while passports for children are valid for just five. The call for higher passport renewal fees came in a wider report by the National Audit Office into government services. A total £340million shortfall was found across all the services looked at - including UK Visas and Immigration, the Court and Tribunals Service and the Driver & Vehicle Licensing Agency. The National Audit Office's report concluded: 'Many government departments rely on charging fees to recover the costs of providing services to people and businesses. 'But none of the services we looked at recovered costs consistently, and the charges for the services may not accurately reflect the costs.' 'The government is missing opportunities to deliver efficiencies and share good practice,' it added. 'This poses risks to the financial resilience of public services, the costs of which are likely to be borne by future fee payers.'
Telegraph
7 hours ago
- Business
- Telegraph
Passport Office urged to raise £95 renewal fee to plug black hole
Ministers have been urged to increase the £95 passport renewal fee in a blow for millions of Britons. The National Audit Office (NAO) said the Passport Office should increase its fees to address a growing black hole in the department's annual budget. The Passport Office had a budget shortfall of £223m last year and a total deficit of £916m over the last five years. The gap is currently covered through taxpayer funds but the NAO said fees should instead be increased to fill the black hole. Higher charges would hit millions of people who renew their passport each year. There were 6.97m passports issued to Britons last year. An adult passport is valid for 10 years while a children's passport is valid for five. The NAO, which scrutinises public spending, said the Passport Office, which is overseen by Yvette Cooper, the Home Secretary, should raise the cost of services in a 'reasonable time'. It did not give a figure for how much fees should rise by. If it were to have filled its £223m black hole last year, it would have had to charge each applicant roughly £32 more based on the number of requests received. The NAO declined to comment on the estimate. Adults must currently pay £94.50 for a new passport, while a one-day renewal costs £222. The recommendation comes after it emerged that Brussels was considering making it more expensive for Britons to visit the EU. A €7 fee set to come into force could be raised to help the bloc cover its Covid debts, diplomatic sources have revealed. The cost of getting a passport has already risen significantly in recent year. In February 2023, the fee for an adult passport was raised for the first time in five years by 9pc, from £75.50 to £82.50. It rose again by 7pc in 2024 before an inflation-busting increase of 6.7pc in April. While high, Britain's fees are not unusual in Europe and the West. An adult passport costs €86 (£73) in France, €101 in Germany and $130 in the US. The NAO argued that the long gaps between renewing a passport meant it was fairer to charge the full cost of the service upfront, rather than running a deficit and asking central government to cover it. It said: 'Persistent deficits lead to large cumulative losses which are difficult to recover and risk creating high fees for service users in later years. 'This can create generational unfairness where services are used only periodically, such as adult passport renewals which happen every 10 years.' The call for even higher fees came in a report by the NAO into government services, including UK Visas and Immigration, the Court & Tribunals Service and the Driver & Vehicle Licensing Agency. Gareth Davies, the head of the NAO, warned that some government services 'are not consistently recovering their costs – posing risks to the financial resilience of these services and fairness between users'. The NAO found a budget shortfall of £340m across all services it looked at, with the Passport Office accounting for the lion's share. The official audit watchdog said the department had made 'significant operational improvements' over the last few years but warned that it had not covered its costs since the 2017/18 financial year. Sir Geoffrey Clifton-Brown, the chairman of the Public Accounts Committee, said: 'Cost recovery is an important mechanism to reduce the tax burden, but imbalances between fees and costs are creating risks for the resilience of public services, falling unfairly on the taxpayer to pay these differences.' 'Correct charging requires accurate data on costs and users, but the system is being hampered by a lack of monitoring and reporting from some departments, the time consuming legislative process to change fees and limited checks from HM Treasury. Better guidance and a more consistent approach on setting and amending fees and charges is also needed across government.' A Home Office spokesman said there were 'no current plans to increase passport fees.'
Daily Mail
12 hours ago
- Business
- Daily Mail
Passport prices could rise AGAIN in another blow for British holidaymakers
The cost of a new passport could rise by a whopping £32 in the latest blow for millions of British holidaymakers. Ministers have been urged to increase the current £95 renewal fee to address a growing black hole in the Passport Office's budget. The department recorded a budget shortfall of £223million last year and a £916million deficit over the past five years. The National Audit Office, which scrutinises public spending, has recommended that the Passport Office increase the cost of its services to address the issue. It did not, however, give a figure for how much the passport renewal fees should increase by. According to The Telegraph, the Passport Office, would need to charge each applicant £32 more to overcome last year's shortfall. The cost of renewing passports has already risen significantly in recent years. The department drastically hiked prices for adult passports in February 2023 - from £75.50 to £82.50. Fees then rose again by 7 per cent last year - before an inflation busting increase of 6.7 per cent in April. The Home Office previously said the new fees were necessary to ensure the cost of passport operations is met without relying on taxpayer funding. It added that fees help cover passport processing, consular services for lost or stolen passports, and border operations. Adults must currently pay £94.50 for a new passport, while a one-day renewal costs £222. Nearly seven million new passports were issued last year. Adult passports are valid for ten years, while passports for children are valid for just five. A Home Office spokesperson said there were no 'immediate plans' to increase fees. Meanwhile, the National Audit Office declined to comment on the estimated price hike. The call for higher passport renewal fees came in a wider report by the National Audit Office into government services. A total £340million shortfall was found across all the services looked at - including UK Visas and Immigration, the Court and Tribunals Service and the Driver & Vehicle Licensing Agency. The National Audit Office's report concluded: 'Many government departments rely on charging fees to recover the costs of providing services to people and businesses. 'But none of the services we looked at recovered costs consistently, and the charges for the services may not accurately reflect the costs.' 'The government is missing opportunities to deliver efficiencies and share good practice,' it added. 'This poses risks to the financial resilience of public services, the costs of which are likely to be borne by future fee payers.' Gareth Davies, head of the National Audit Office said: 'Government bodies provide important services for the public and businesses, including issuing passports and driving licences, and filing company information. 'But many are not consistently recovering their costs - posing risks to the financial resilience of these services and fairness between users. 'HM Treasury should strengthen how it oversees cost recovery processes and provide more comprehensive guidance to charging bodies.'
The Guardian
2 days ago
- Business
- The Guardian
HS2: a complete failure by the British state and its politicians
When was it obvious that HS2 was an economic turkey at risk of becoming 'an appalling mess', as transport secretary Heidi Alexander described today's position? A fair case can be made for 2013, a year of two neon-lit warnings of trouble ahead. One was a scathing report on HS2 from the National Audit Office (NAO), the first of many, when the project was still at the planning stage. The NAO concluded it was impossible to say whether the programme was likely to deliver value for money; the cost and benefit estimates were 'uncertain'; there had been 'past errors in the underlying model'; the Department for Transport had 'poorly articulated' the strategic need for a transformation in rail capacity and how HS2 was supposed to rebalance economic growth. In short, there was 'a weak foundation for securing and demonstrating success in the future'. Then there was Peter Mandelson's remarkable insider confession in the pages of the FT of how Gordon Brown and his cabinet came to approve HS2 in the first place in 2010. It was a tale of collective short-termism; in the grim post-banking crash era, the Labour government didn't want to be outdone by the Tories in their enthusiasm for a shiny new big project. The cost estimates were 'almost entirely speculative', wrote Mandelson, but 'the vision was exciting' and 'we were focusing on the coming electoral battle'. Laughably, ministers had imagined HS2 would attract private sector backers. By 2013, Mandelson had changed his mind on HS2 and feared 'an expensive mistake'. If only others had rethought. It would have been a painless option for David Cameron's coalition government to ditch the whole adventure. There was an excuse to do so because an earlier report in 2006 by former British Airways chief Sir Rod Eddington, which was being reread with fresh eyes at the time, had rejected the idea of new high-speed rail links. For a country the size of the UK, the best value will usually lie in improving existing rail and road networks, it argued. Instead, the HS2 show rolled on, fuelled by more political puff and short-termism. Some of the passages in the review by ex-KPMG infrastructure adviser James Stewart, published by Alexander on Wednesday, are excruciating. Key decisions, such as the passing of the first parliamentary bill in 2017 and the letting of works contracts, prioritised the schedule over costs. 'I have heard a range of reasons for this but pressure from politicians to maintain momentum, fear of HS2 being cancelled, and the belief that costs will increase as a result of delay have featured strongly,' says Stewart. Meanwhile, 'the top-down vision of building a railway that would be the best and fastest has been a major factor in undermining attempts to introduce a culture of cost control'. This is tear-your-hair-out stuff because it breaks the golden rule about getting plans hammered down in detail before you start building large-scale infrastructure projects. Even now half of Euston sits as a wasteland before a plan has been agreed for a design for a HS2 terminus. The main source of cost overruns, as Stewart and Mark Wild (the ex-Crossrail chief executive now charged with salvaging the shambles) agree, were the works contracts. The contracting model, combined with unrealistic targets, turned the contracts into 'cost-plus' arrangements whereby contractors had little to no incentive to hit cost targets. Companies rang rings around the department and its arm's-length body, HS2 Ltd. The Institution of Civil Engineers concluded roughly the same in its report last year: huge contracts created 'an imbalance of power', especially in the context of a political demand to hurry up. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion Later Tory leaders, especially Boris Johnson, deserve their own mention in the catalogue of infamy. It was Johnson who pushed the formal 'notice to proceed' button in 2020, in full knowledge that the review he commissioned from Douglas Oakervee said HS2 only made sense if built in full. Within 18 months, and with costs hurtling out of control, ministers amputated most of HS2's eastern arm to Leeds in 2021; the section to Manchester followed. In shrunken circumstances, it makes sense, as Alexander and Wild say, to slow down and complete the rump Birmingham-London link to a slower timetable in the interests of minimising yet more cost overruns. It will involve running the high-speed trains at slower speeds initially, a suitably farcical postscript to a project that has wasted tens of billions of pounds and consumed the lion's share of spending on rail for years. The tragedy is this ending has been predictable for about a decade.
Asia Times
4 days ago
- Business
- Asia Times
China's fast-growing high-speed railway network faces reality
The financial situation of China's high-speed railway network has raised concerns among Chinese commentators as the facility is facing growing debt and weakening passenger spending power. In February this year, a group of Chinese commentators said a report by the National Audit Office (NAO) had found that China's high-speed railway saw an 'about 100 billion yuan of total loss' in the nine months ending December 31, 2024. NAO's website did not officially announce this widely reported figure. Since then, Chinese commentators have started debating the matter. Some said the country should not have extended its high-speed railway to remote places without calculating the costs over the past two decades. Others said China's high-speed railway has value as a public facility that connects people in less developed areas to large cities. Specific financial figures about China's high-speed railway are unavailable, as the China State Railway Group Co Ltd (China Railway) combined them with those of 'green-skinned trains,' which are the older type of passenger trains often painted green. Although Beijing-Shanghai High Speed Railway Co Ltd regularly discloses its financial data to the Shanghai stock exchange, its figures do not reflect the situation of the loss-making units under China Railway. An article by said on June 5 that the Beijing-Shanghai High Speed Railway saw a 2.31% year-on-year decline in its total passenger number to 52.02 million people last year. The company still managed to boost its net profit by 10.6% to 12.77 billion yuan (US$1.78 billion) in 2024 by sharing its network with other train operators. The article pointed out that China's high-speed railway network was 45,000 kilometers at the end of 2023, but only 2,300 kilometers, or 6% of the total, could make a profit. It said that out of all 16 high-speed railway lines, only six in coastal cities are profitable. They include the Beijing-Shanghai, Beijing-Tianjin, Shanghai-Hangzhou, Ningbo-Hangzhou, and Guangzhou-Shenzhen lines. It said the most profitable Beijing-Shanghai line will have to spend 20 years recovering its initial investment of 220.9 billion yuan. Last year, China's train passengers surged 10.9% year-on-year to 4.09 billion in 2024, according to the National Railway Administration. China Railway's total revenue grew 3.1% to 1.28 trillion yuan, while net profit surged 17.6% to 3.88 billion yuan. These figures, which included the company's old railway and high-speed railway segments, could not reflect the situation in which many people had become price-sensitive in a sluggish Chinese economy. 'Since the beginning of 2024, data from many high-speed rail lines have been unsatisfactory,' a Henan-based writer says in an article published in February. 'There were very few passengers on weekdays, but the maintenance costs stood high.' 'In June 2024, the situation worsened, increasing financial pressure on the national railway operator,' he writes. 'Last September, the government finally took action by urging the train operator to reschedule its trains' timetables, attract private investment and improve efficiency with new technologies.' He says that after lowering train frequency and fares in remote areas in January this year, the situation slightly improved, but not enough to boost China Railway's profitability. Media reports said that when millions of migrant workers went home during the Spring Festival in late January, many took the 'green-skinned trains,' leaving the high-speed railway trains underutilized. A Sichuan-based columnist says it takes about 4.5 hours to travel from Zhengzhou to Wuhan on ordinary trains for 70 to 90 yuan. He says the journey can be less than two hours on high-speed trains, but the fare is about 270 yuan. He says it's normal for migrant workers to take a slower train as the faster one would cost them one to two days' salary. On June 15, China Railway increased fares by up to 20% for its profitable lines to subsidize the unprofitable ones. According to its annual report, China Railway had total liabilities of 6.2 trillion yuan at the end of 2024, up 1.2% from 6.13 trillion yuan a year earlier. Total assets increased 4.4% to 9.76 trillion yuan from 9.35 trillion yuan for the same period. Since 2010, China Railway has closed 20 high-speed railway stations due to insufficient passenger traffic. Many 'ghost stations' were in inland provinces, such as Anhui and Yunnan, while some were in coastal provinces, such as Liaoning and Jiangsu. A Hubei-based columnist says that after the central government launched a 4 trillion yuan economic stimulus package in 2008, many local governments got new funding to accelerate their high-speed railway projects, but built many stations in remote and inconvenient places. He says that these local governments are now facing rising financial pressure and have to reduce the subsidies for their transportation network. This is why many stations have to be shut down. A Hebei-based writer named Zelin says many high-speed railway projects in China are doomed to lose money, as many local governments only wanted to achie ve political achievements without considering the profitability of the ir facilities. He said the maximum fare of the Beijing-Shanghai line is 553 yuan, which is lower than that of the Tokyo-Osaka line (the equivalent of 1,200 yuan). Thus, it is unlikely that China's high-speed railway projects will turn a profit in the short run. He added that someone has suggested that China Railway increase train fares, encourage local governments to bear more construction costs, cut the number of high-speed railway stations from 1,300 to 960, improve governance, and reduce costs. However, he said that all these suggestions are easier said than done. He said the public should focus more on the high-speed railway network's social value than its commercial value. Read: Price war sparks EV financial crisis concerns in China
