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UK PASSPORT SERVICE

ANNUAL REPORT AND ACCOUNTS

2003–2004U

KPA

SS

PO

RT S

ERVIC

EAnnual R

eport and Accounts 20

03

–2

00

4

REGIONAL OFFICES

Glasgow

Durham

Peterborough

London &HeadquartersNewport

Belfast

Liverpool

Contact:Passport Adviceline on 0870 521 0410www.passport.gov.uk

9 780102 928297

ISBN 0-10-292829-0








UK PASSPORT SERVICE


2003–2004

UK

PAS

SP

OR

T SER

VICE

Annual Report and Accounts 2

00

3–

20

04

REGIONAL OFFICES

Glasgow

Durham

Peterborough


Belfast

Liverpool


Passport errorsTo reduce the level of passportsreturned with errors after issue to0.25% (reduced from 0.33% in2002–03)

Not met: The level of passportsreturned with errors after issuewas reduced to 0.27%

Although the target was not met,the 0.27% error rate is asignificant improvement on2002–03 when the error ratewas 0.38%

PERFORMANCE TARGET RESULT

Customer satisfactionTo ensure a customersatisfaction rate of 93%

TurnaroundTo ensure that 99.5% ofstraightforward partner andpostal applications are turnedaround within 10 days

To ensure that 99.5% ofPremium and Fast Track servicesare turned around within theguaranteed period

Appointment timesTo ensure that 92% ofcustomers are seen within 20minutes of their appointmenttime

Telephone callsTo ensure that 90% oftelephone calls are answeredwithin 20 seconds

Exceeded: 95% of customerswere seen within 20 minutes oftheir appointment time

Exceeded: 99.9% ofstraightforward partner and postalapplications were turned aroundwithin 10 days, despite demandvolumes of 7% above plan

Partly met: 99.5% of Fast Trackapplications were processedwithin service standards; 98.8%of Premium service applicationswere processed within servicestandards

Exceeded: The averagecustomer satisfaction rate was98%

Not met: The number oftelephone calls answeredwithin 20 seconds was 89%

The volume of calls, at 3.3million, were 3% higher than2002–03

90%

92%

94%

96%

98%

100%

1999–00 2000–01 2001–02 2002–03 2003–04

Actual

Target

Customer satisfaction

Turnaround of postal and partner applications within 10 days

98.4%

98.6%

98.8%

99.0%

99.2%

99.4%

99.6%

99.8%

100.0%

2000–01 2001–02 2002–03 2003–04

Actual

Target

Customers seen within 20 mins of appointment

84%

86%

88%

90%

92%

94%

96%

98%

100%

2001–02 2002–03 2003–04

Actual

Target

86%

87%

88%

89%

90%

91%

92%

2000–01 2001–02 2002–03 2003–04

Actual

Target

Telephone calls answered within 20 seconds

0.00%

0.05%

0.10%

0.15%

0.20%

0.25%

0.30%

0.35%

0.40%

2000–01 2001–02 2002–03 2003–04

Returnedpassports

Target

Average number of passports returned with error

The staff satisfaction survey isundertaken every two years, and waslast completed in 2002–03. At thattime, 77% of staff were satisfied withtheir job

A new survey is due for completionin early 2005

Staff developmentTo invest 4.5% of salary cost intraining and development

Staff turnoverTo ensure staff turnover ratedoes not exceed 12%

Not met: The percentage ofsalary cost spent on training anddevelopment was 4.1%

Exceeded: The staff turnover ratefor the year was 9.1%


Unit costTo achieve a unit cost of £24.41

Surplus/deficitTo achieve a surplus, after FCOcosts, of £15.4 million

Staff absenceTo ensure that the averageannual staff sickness absencerate does not exceed 11 daysper (full-time equivalent)member of staff

Invoice paymentTo ensure 97% of invoices arepaid within 30 days of receipt

Not met: The average rate ofsick absence was 11.1 days per(full-time equivalent) member ofstaff, however sick absence hashad a downward trend over thepast ten years

Exceeded: The total surplus,after FCO costs of £40.7 million,was £29.1 million

Exceeded: An average unit costof £22.86 was achieved

Exceeded: The averagenumber of invoices paid within30 days was 99%

Passport unit cost

0

5

10

15

20

25

30

1998–99 1999–2000 2000–01 2001–02 2002–03 2003–04

Pou

nds

Actual

Target

0

5

10

15

20

25

30

35

40

45

2000–01 2001–02 2002–03 2003–04

Actual

Target

Surplus after FCO costs

Mill

ion

poun

ds

Staff sickness absence

0

2

4

6

8

10

12

14

16

95

96

97

98

99

99

–0

0

00

–0

1

01

–0

2

02

–0

3

03

–0

4

Day

s pe

r an

num

Actual

Target

84%

86%

88%

90%

92%

94%

96%

98%

100%

1998–99 1999–2000 2000–01 2001–02 2002–03 2003–04

Actual

Target

Invoice payment within 30 days

Staff satisfactionTo ensure a staff satisfaction ratewith working for the UKPS of 90%

CONTACT:

If you wish to receive further information on any of the issues in this document or have any questions relating to the services

provided by the UK Passport Service, please contact:

Marketing and Communications Directorate

UK Passport Service

Globe House

89 Eccleston Square

London SW1V 1PN

Or via the Passport Service website: www.passport.gov.uk

You can also contact the Passport Adviceline (24 hours a day, 7 days a week)

0870 521 0410

(Calls are charged at national rate)

All media enquiries should be directed to the Home Office Press Office:

020 7273 4545

UK PASSPORT SERVICE


2003–2004

Presented to the House of Commons pursuant to Section 7 of the Government Resources and Accounts Act 2000.

Ordered by the House of Commons to be printed 13 July 2004.

HC 803

London: TSO

£16.35

CONTENTS

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

CHIEF EXECUTIVE’S MESSAGE v

INTRODUCTION 1Objectives 1Working in Partnership 2Our Structure 2Annual Report 3

OPERATING ENVIRONMENT 4Passport Demand 4Passport Fraud 4Identity Cards 4Modernising Government Agenda 4Freedom of Information Act 4

REVIEW OF THE YEAR 5Key Achievements 5

PLANNING PRIORITIES 6Customer Service: Responding to Customer Needs 6Quality and Security: Improving Fraud Prevention and Detection 6Efficiency and Finance: Achieving Operational Efficiency and Business Assurance 6Achieving through People: Unlocking Staff Potential 6Innovation and Development: Maximising the use of Technology 6

CUSTOMER SERVICE 8Responding to Customer Needs 9Maintaining Customer Service Standards 9

QUALITY AND SECURITY 11Improving Fraud Prevention and Detection 12Secure Delivery of Passports 12Personal Identity Project 12Omnibase 12Lost, Stolen and Recovered Passports Database 12Fraud and Intelligence Units 13Joint Working with other Agencies 13

EFFICIENCY AND FINANCE 14Achieving Operational Efficiency and Business Assurance 15Improve Productivity 15Process Mapping 15Maintain Effective Contract Management 15Risk and Assurance 15

ACHIEVING THROUGH PEOPLE 16Unlocking Staff Potential 17Training and Development of Staff 17Integrated Pay and Performance Management System 17

>>

iv

>>>>>>>>>>>>> UKPS Annual Report and Accounts 2003–04 >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

Re-accreditation as an Investor in People 18Implementation of Diversity Action Plan 18Development of Career Paths 18A Healthcare Programme 19Partnership with PCS 19Brightsparks 19

INNOVATION AND DEVELOPMENT 20Maximising the Use of Technology 21IT Strategy 21Person-centric Database 21ePassport 21Development of Management Information Systems 21Biometric Trial 21Internal IT Systems 21

FUTURE PRIORITIES 22Authentication by Interview 22Personal Identification Project (PIP) 22ONS Online 23Lost, Stolen and Recovered (LSR) Database 23ePassport 23Facial Recognition 23Second Biometric 23Passport Cards 23

CORPORATE AND SOCIAL RESPONSIBILITY 24Economic Factors 24Social Factors 24Environmental Factors 24

ACCOUNTS AND NOTES 25Foreword to the Accounts 25

STATEMENT OF THE UKPS AND CHIEF EXECUTIVE’S RESPONSIBILITIES 29

ANNUAL STATEMENT ON INTERNAL CONTROL 30

THE CERTIFICATE AND REPORT OF THE COMPTROLLER AND AUDITOR GENERAL TO THE HOUSE OF COMMONS 33

ACCOUNTS – FOR THE YEAR ENDED 31 MARCH 2004 34Notes to the Accounts 37

ACCOUNTS DIRECTION GIVEN BY THE TREASURY IN ACCORDANCE WITH SECTION 7 (2) OF THE GOVERNMENT RESOURCES AND ACCOUNTS ACT 2000 52

ANNEX (A) MEET THE MANAGEMENT TEAM 53

ANNEX (B) GLOSSARY OF TERMS 55

ANNEX(C) UKPS PUBLICATION SCHEME 56

ANNEX (D) DIVERSITY ACTIONS 58

FEEDBACK FORM 59

CHIEF EXECUTIVE’S MESSAGE

v

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

This Annual Report and Accounts summarises a further year of achievement for the UK Passport

Service.

The achievements outlined in this report are made against a backdrop of increased pressure on the

Service to maintain its reputation for the delivery of excellent customer service whilst remaining vigilant

to those who would try to access our services for illegal purposes. In response to this we have focused

resources on fraud prevention measures and have had a number of notable successes in this area.

Several new systems have been implemented during the year to strengthen the integrity of our

processes.

The year 2003–04 saw unprecedented levels of demand for passports, with over 5.9 million

applications being processed; some 7% above plan. Customer service has remained excellent with

almost all of our key targets met or exceeded, with continuing high levels of customer satisfaction. We

have delivered operational efficiency during the year and, despite a significant investment in fraud

prevention measures, have made a surplus that allows us to repay £26.7 million of past deficits to HM

Treasury.

Looking to the future, we have defined our vision: ‘To focus on stronger identity authentication for the

purpose of issuing passports.’ By focusing on stronger identity authentication we will provide better

customer service by safeguarding our customers’ identities. We benefit society by reducing identity-

associated criminal activity. We are making a strong contribution internationally to strengthen the

security of British travel documents. However, we will not lose sight of our primary role of enabling travel

as defined by our mission.

Our mission and vision are underpinned by a set of values that the UKPS aspires to reflect in everything it

does. We value our people, honesty and integrity, customer service, working together and personal

responsibility. The importance of our staff and their part in the excellent results contained within this

report cannot be underestimated. I would like to thank all staff for their continued commitment and hard

work. We have invested significantly in staff development and will continue to do so. I have also

strengthened the Board this year with the appointment of additional Executive and Non-Executive

Directors.

We cannot achieve our strategic objectives on our own and will be working in partnership with a range of

organisations in both the public and private sectors, as well as with the trade union representing our staff.

The achievements detailed in this report provide the UKPS with a sound platform for future

development. We have now embarked on a major change programme. Working with our staff and

partners, we will pursue this programme while ensuring that we continue to deliver excellence in service

to our customers.

Bernard Herdan

Chief Executive

INTRODUCTION

1

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

Our values'Customer service, working together, personal

responsibility, honesty and integrity and our people'

Our vision'To focus on stronger identity authentication

for the purpose of issuing passports'

Our mission'Confirming nationality and identity – enabling travel'

The UK Passport Service (UKPS) was established as an Executive Agency of theHome Office on 2 April 1991, and during the peak season this year employed2,890 full-time equivalent staff, over 90% of whom work in regional offices. It isresponsible for the issuing of passports to British nationals living in the UnitedKingdom. This responsibility is encapsulated in its mission, vision and values:

OBJECTIVES

In pursuit of its mission, the UKPS’s

main objectives, as reflected in its key

targets, are to:

• deal promptly, courteously and

efficiently with all enquiries

• provide services which support

diversity of customer choice

• maintain the integrity and accuracy

of documentation issued

• monitor the incidence and types of

fraud and take suitable measures to

prevent it

• improve efficiency and deliver value

for money

• ensure equality of opportunity for

staff

• develop the skills, professionalism

and job satisfaction of its staff.

Further details can be found in the

2003 UK Passport Service Framework

Document.

2

>>>>>>>>>>>>>>> UKPS Annual Report and Accounts 2003–04 >>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

• Our High Street partners

Worldchoice UK Limited and Post

Office Ltd are recognised as the first

port of call for those seeking

application forms. The partners also

provide a ‘Check & Send’ facility and

receive almost 45% of all

applications on behalf of the UKPS.

• Siemens Business Services (SBS)

provides services at the front end of

the passport production process. It is

responsible for providing mail-room

services, scanning application

forms, cashiering fees and initial

query handling with the applicant.

SBS also provided the IT

infrastructure to support all UKPS

passport applications operations

and is continuing to develop this.

• Security Printing and Systems Ltd

(SPSL) is responsible for printing over

90% of all passports.

• MM Group is responsible for dealing

with over 85% of all telephone

enquiries. It also handles

appointment bookings, e-mail and

electronic applications support on

behalf of the UKPS.

• Atos Origin provides IT and

infrastructure support to the

organisation.

• Special Mail Services Limited (SMS)

specialises in the secure delivery of

credit cards and other products for

the financial services industry. On 28

November 2003 the UKPS signed a

three-year contract with SMS for the

secure delivery of all UK passports.

INTAKE FRONT-ENDPROCESS

CORE EXAMINATIONAND ADJUDICATION

PRINTING OUTPUT

DIRECT POSTALAPPLICATIONS

APPLICATIONS THROUGHHIGH STREET PARTNERS

(URGENT) PERSONALAPPLICATION AT UKPS

OFFICES

SCANNING/DATA ENTRY EXAMINATION

PROCESS – IDAND

NATIONALITY

ADJUDICATIONDECISION

CENTRALPASSPORTPRINTING

ANTI-FRAUDCHECKS ANDADDITIONAL

EXAMINATIONS

COLLECT

DESPATCH

LOCALPASSPORTPRINTING(URGENTCASES)

ONLINEAPPLICATIONS

SUPPORTING IT INFRASTRUCTURE

HANDLING PUBLIC TELEPHONE ENQUIRIES

CASHIERING

CHECKCOMPLETENESS

= Outsourced

LEGEND:

Post Office & WorldChoice

SBS

MM Group

Atos Origin - Admin IT

SPSL

SMS

SBS - PASS

SBS

WORKING IN PARTNERSHIP

The UKPS works with a number of different partners at each stage of the passport issuing process:

OUR STRUCTURE

The UKPS Board has been restructured

this year, and has been strengthened

with the addition of a Strategic Planning

Director, a Commercial Director, and a

Director of Programmes. The Chief

Executive, Bernard Herdan, as Chief

Accounting Officer, remains directly

responsible to the Home Secretary for

the performance and future

development of the UKPS.

The UKPS Ministerial Advisory Board

was disbanded during the year.

However, a third Non-Executive Director

has been appointed to the UKPS

Management Board, and all three Non-

Executive Directors meet at least once a

year with the responsible Minister, and

have access to the Home Office sponsor

at other times during the year. The

Home Office sponsorship role is to be

strengthened.

3

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

The Management Board is responsible,

inter alia, for reviewing the progress of

the UKPS against its objectives, and

taking policy and operational decisions

as required. Full details of Board

members can be found in Annex (A) of

this report.

The financial probity of the UKPS is

overseen by an Audit Committee that is

chaired by a Non-Executive Director and

is attended by representatives from the

Home Office and National Audit Office.

The Service also consults its

stakeholders via the Consultative Panel

of Passport Users.

The UKPS Remuneration Committee

meets at least twice a year to determine

the reward appropriate to senior

managers other than those covered by

Senior Civil Service procedures. It aims

to ensure an appropriate balance

between internal and external

relativities, with account being taken of

performance and marketability. It is

chaired by a Non-Executive Director.

ANNUAL REPORT

This Annual Report covers the UKPS’s

performance over the financial year 1

April 2003 to 31 March 2004. It sets out

how the UKPS has performed against

the year’s key targets and tasks as

published in the UKPS Corporate and

Business Plan 2003–2008.

This document is primarily aimed at

those to whom the UKPS is accountable

and who are responsible for monitoring

the UKPS’s performance on behalf of

the public, including Ministers,

Parliament, the Home Office and the

UKPS Advisory Board. It also serves to

inform a number of groups interested in,

or affected by, the UKPS’s business. For

example, stakeholders such as partners

and people in the travel trade industry,

as well as the general public.

>>

OPERATING ENVIRONMENT

4


The UKPS continues to be a demand-led

organisation. Demand for passports in

the early part of the year was influenced

by the conflict in Iraq and the SARS

virus. Demand did recover during June

and July 2003. A well-publicised fee

increase and an announcement by the

United States regarding visa

requirements for travellers saw demand

reach unprecedented levels during

September and October 2003. It was

also extremely strong in the first quarter

of 2004. The combined result of all of

these factors is that the UKPS

processed 5.9 million applications for

passports, 7% above plan.

PASSPORT FRAUD

The UKPS remains vigilant to passport

fraud, and there has been extensive

evidence of the threat from this type of

crime. During the year it has worked in

partnership with the police and others

on a number of successful operations

targeting organised trafficking of illegal

immigrants and forged documents. Full

details of our fraud prevention activities

can be found in the ‘Quality and

Security’ section of this report.

IDENTITY CARDS

The year 2003–04 saw the UKPS

develop its role in support of the

Government’s identity card programme.

The UKPS has worked with the Home

Office ID Card Unit and with other

departments and agencies (including

the Department of Work and Pensions,

the Driver and Vehicle Licensing Agency

and the Immigration and Nationality

Service) to ensure a joined-up and co-

ordinated approach to the programme

is maintained across Government.

MODERNISINGGOVERNMENT AGENDA

The UKPS has made, and continues to

make, a significant contribution towards

implementing the modernising

government agenda. The UKPS is keen

to respond to the needs of all its

customers and recognises the

importance of responding to rising

customer expectations and changing

public behaviour when planning future

services. We continue to hold the

Charter Mark in recognition of our

excellent customer service standards.

We have made a commitment to provide

access to our services online, and are

currently developing an improved online

application route for launch in early

2005.

FREEDOM OF INFORMATIONACT

We remain fully committed to the

principles of the Freedom of Information

Act and have already published full

details of our publication scheme on our

website. Further details of the scheme

can be found at Annex (C) of this report.

The 2003/2004 strategic planning process identified sectors and activities that

would contribute to the achievement of UKPS’s objectives.

PASSPORT DEMAND

Demand 2003/04

0

200,000

400,000

600,000

800,000

Apr-03

May

-03

Jun-0

3Ju

l-03

Aug-03

Sep-0

3

Oct-03

Nov-0

3

Dec-0

3

Jan-0

4

Feb-0

4

Mar

-04

REVIEW OF THE YEAR

5

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

The UKPS can be proud of its achievements over the year. During the last 12 months

it has received over 5.9 million applications for passports and processed an

extremely high proportion within service standards.

KEY ACHIEVEMENTS

• Met or exceeded the majority of our performance targets.

• Exceeded customer expectations in a number of areas.

• Strong financial performance allowed us to recover £26.7 million of past deficits.

• Successfully rolled-out a global passport-issuing database (Omnibase).

• Successful roll-out of the lost, stolen and recovered passport database.

• Introduction of secure delivery for passports.

• Enjoyed good employee relations via our partnership with the Public and

Commercial Services Union (PCS).

• Achieved re-accreditation as an Investors in People organisation.

• Input into an international decision on biometric chip passport standards.

• Key participant in the ID card programme.

• Defined a five-year integrated change programme (ICP).

• Supported the successful establishment of the Criminal Records Bureau as a

stand-alone agency.

Check & Sendservice

43%

Postal47%

Electronic2%

In-person8%

Amendments3%

Adult renewal51%

Child first-time

22%

Adult first-time

17% Child renewal7%

Applications by service type:actual 2003–04

Applications by route: actual 2003–04

>>

PLANNING PRIORITIES

6


The UKPS adopts a ‘balanced scorecard’

approach to planning and reporting

performance. This ensures a proper

balance is achieved between different

elements of the business. The five

elements of the balanced scorecard are:

• Customer Service

• Quality and Security

• Efficiency and Finance

• Achieving through People

• Innovation and Development.

The UKPS’s priorities set out in the

UKPS Corporate and Business Plans

2003–08 under the balanced

scorecard headings were as follows.

CUSTOMER SERVICE:Responding to Customer Needs

• To achieve a challenging set of

service standards.

• To improve the electronic application

route.

• To develop a passport card.

• To introduce secure delivery of all

passports.

• To identify the cause of passport

errors and work towards reducing

them.

QUALITY AND SECURITY:Improving Fraud Prevention andDetection

• To launch a global passport issuing

database in conjunction with the

Foreign and Commonwealth Office

(FCO).

• To build a global lost, stolen and

recovered passport database.

• To investigate and take action

against those seeking to obtain

passports illegally.

• To improve staff training in fraud

prevention and detection, and

create specialist fraud and

intelligence units.

• To work with other organisations

(both public and private) to share

data.

The following sections of the Annual

Report show how the UKPS has

performed against these objectives.

EFFICIENCY ANDFINANCE: Achieving Operational Efficiencyand Business Assurance

• To undertake measures to improve

operational efficiency.

• To maintain effective contract

management.

• To assess our wider market

activities.

• To undertake an annual review of

fees.

• To improve our internal control

framework, risk management and

audit.

INNOVATION ANDDEVELOPMENT:Maximising the use of Technology

• To undertake staff training

programmes.

• To develop the Personal

Identification Project.

• To assess the feasibility of creating a

person-centric database.

• To develop a biometric capability.

• To improve internal IT systems.

ACHIEVING THROUGHPEOPLE: Unlocking Staff Potential

• To deliver a quality training

programme to meet individual and

business needs.

• To reform existing performance

management arrangements linked

to pay reform.

• To develop a new competence

framework linked to new corporate

values.

• To manage attendance and poor

performance.

7

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

>>

CUSTOMER SERVICE

8

9

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

RESPONDING TOCUSTOMER NEEDS

We have continued to monitor our

performance against our customer

service standards. In addition to this, we

have continued to conduct independent

customer satisfaction surveys (via FDS

International) and ‘mystery shopped’ all

aspects of our services. We have also

run customer focus groups seeking

views on key proposals such as

biometrics and fee increases related to

improved security features.

When asked to assess our overall

performance, 98% of customers were

either satisfied or very satisfied with the

service received.

Our customer focus groups highlighted

continued support for fraud prevention

work, with customers viewing this as our

number one priority. The UKPS has

continued to enjoy Charter Mark

recognition during 2003–04.

A number of conferences and seminars

have enabled us to promote the efforts

of the UKPS in delivering effective

customer services.

The Chief Executive, Bernard Herdan,

gave a presentation to the

Parliamentary Information and

Technology Committee on using

technology to deliver public-sector

services.

The Deputy Chief Executive, Kevin

Sheehan, gave a presentation on

public/private partnership in business

process outsourcing in Berlin in October

2003, based on the UKPS’s experience.

The year 2003–04 saw the UKPS host a

number of overseas visitors including

delegations from Zambia, Israel, South

Korea and France. It also hosted the

Five Nations Conference with delegates

from Australia, Canada, New Zealand,

the United States and Japan meeting to

discuss customer service, operational,

technological and security issues.

Maintaining Customer ServiceStandards

Despite the number of applications

received being 7% above plan, the

UKPS has exceeded its target of

processing 99.5% of straightforward,

properly completed applications in ten

working days, achieving a 99.9%

standard.

Almost 450,000 applications were

made in person via our Fast Track or

Premium service options. We achieved

our target of processing 99.5% of Fast

Track applications within five working

days, but just missed our four-hour

turnaround time on our Premium

service, dealing with 98.8% of

applications against a target of 99.5%.

We achieved an accuracy rate of

99.73%, compared with 99.62% the

previous year.

Our call-centre operations, run in

partnership with the MM Group, dealt

with 3.3 million telephone enquiries

and answered 89% of these within 20

seconds. It dealt with almost 268,000

e-mail enquiries and responded to

100% of these within four hours of

receipt. This compares with 3.05 million

calls and 188,000 e-mails in 2002–03.

We received 7,094 complaints during

the year, which equates to just 0.13% of

our total business, and 1,685 positive

comments.

‘Truly the mostimpressive example ofcustomer service in anyfield I have experiencedto date.’

Roland Potts, London

‘ I am writing to expressmy sheer delight at theexpress service of thepassport service indelivering my passport.’

Miss V. Storey, Worcs

‘Faultless service.’

Dilwyn Jones, Devon

The UKPS call centre, run in partnership with the MM Group.

10


Improvements to our online application route

An easier online application route was introduced by the UKPS in December

2003. Outcomes included:

• in response to customer feedback, navigation, legibility and usability of the

online application route was improved

• data validation and help functions of the online application were improved.

Keeping customers informed

To advise customers of the new lost, stolen and recovered passports

telephone service and procedures, the UKPS sponsored the ITV2 Airline and

Holiday Airport series. This was the first time the UKPS has promoted its

services in this way and it was awarded two silver awards by the International

Visual Communication Association for:

• Best Animation, Graphics and Special Effects

• Best Business to Consumer Information

Passport cards

Work has continued to develop a passport card to make travelling to Europe

more convenient for British passport holders.

Liverpool Passport Office relocation

To improve the environment for both

customers and staff, work has been carried

out in preparation to move the Liverpool

Passport Office and it is on schedule to

occupy its new building in September 2004.

Quality and assurance teams

2003–04 saw the introduction of enhanced quality and security checks in

regional offices. Undertaking random checks on passports that are about to

be approved for issue, the team undertakes a thorough cross-check of the

documents and information provided. The number of passports issued with

errors has been reduced from 0.38% to 0.27%.

Other highlights for 2003–04 include:

QUALITY AND SECURITY

11

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12


IMPROVING FRAUDPREVENTION ANDDETECTION

There are strong links between identity

fraud and other forms of criminality. The

UKPS has strengthened its co-operation

with the police, Immigration Service and

other law-enforcement agencies. The

year 2003–04 saw members of staff

from the UKPS working on secondment

with some local police forces and other

agencies jointly to combat identity theft

and passport fraud.

Working with external organisations is

only one element of the UKPS’s fraud

prevention strategy; with substantially

more staff devoted to this work a

number of improvements to internal

operating systems and procedures have

been introduced during 2003–04.

Secure Delivery of Passports

Part of the 2003 fee increase has

enabled the UKPS to provide secure

delivery of passports to customers.

Working in partnership with Special Mail

Services Ltd, the initiative was rolled-out

across the UK in February/March 2004.

Although there have been some teething

problems, reported losses in delivery

have been drastically cut and over 98%

of passports are now delivered within 24

hours of printing. Remedial work is being

carried out to resolve outstanding

issues.

Personal Identity Project

Confirming a person’s identity is

absolutely key to the passport-issuing

process. To improve our identity

validation processes the UKPS has

been working on a trial basis to gain

access to information held on private

and public sector databases. In limited

geographic areas, applicants have been

asked to provide additional information

and consent to allow verification of their

data against a range of data sources. A

first trial was run in 2002–03 but the

results proved inconclusive. A new

larger-scale trial has been underway at

the Glasgow office in partnership with

Equifax during the year, and is expected

to conclude by the end of 2004. At that

point the UKPS will decide whether or

not to include this system as part of its

standard identity checking processes

for all applicants.

Omnibase

OmniBase has been developed by the

UKPS to provide online access to the UK

passport database by other government

departments.

OmniBase is fully rolled-out and is used to

support all Foreign and Commonwealth

passport issues overseas.

In addition, OmniBase is used by the

following government departments for

fraud or other investigations:

• DVLA

• CRB

‘The increased price hasbeen well worth it.’

Victoria Robinson,London

Operation Wisdom

The UKPS has been matching birth and death data for England and Wales

against passport records. This exercise has now been completed with over

1,000 names being placed on a World-Wide Warning List. Arrests have taken

place in the UK, USA, Canada, Australia and in Africa and Asia. The Team is

now working on data coming from Scotland and Northern Ireland.

Over 312,000 passports were

reported lost or stolen during

2003–04. Some of these were later

recovered from individuals trying to

enter the UK illegally. To improve the

speed at which we are advised of a

lost or stolen passport, we have

created a dedicated hotline for

customers as well as other routes by

which we are informed of losses by

customers, police and FCO posts

overseas.

We have created a global database

of passports that have been

reported as lost or stolen, ensuring

that the information is shared

rapidly with our colleagues in FCO

offices and the Immigration Service.

In 2004 it is planned to develop

sharing this data through Interpol

and European Union systems, as

well as bilaterally.

Lost, Stolen and Recovered Passports Database

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• NCIS

• Immigration Service.

The UKPS is currently in discussion with

additional organisations regarding the

expansion of access to Omnibase:

• DfES

• Customs and Excise

• Special Branch

• expanding access within the

Immigration Service.

Fraud and Intelligence Units

The year 2003–04 has seen the UKPS

strengthen its internal fraud

investigation capabilities. Additional

staff have been recruited to each of our

regional offices to strengthen existing

fraud prevention units.

The responsibilities of the Fraud and

Intelligence Units (FIUs) include

undertaking both proactive and reactive

fraud investigations, and being

responsible for delivering fraud

awareness training to colleagues.

By March 2005, we will have 60

counter-fraud specialists (accredited by

Portsmouth University) working within

these teams, operating to policy and

guidance developed in accordance with

legal requirements.

Joint Working with other Agencies

The UKPS continues to work with a

range of investigative agencies,

including the police, and has

established close links with the UK

Immigration Service via an Immigration

Officer seconded to our Central Fraud

and Intelligence Unit at Globe House.

The UKPS also has an officer seconded

to the National Criminal Intelligence

Service, and through this arrangement

has developed links to other agencies

across the UK and beyond.

Since August 2003 the UKPS has had

two staff seconded to the Joint

Operation Maxim

During 2003–04 Operation Maxim was responsible for over 160 arrests.

Associated premises searched recovered 235 passports (both UK and others),

36 UK driving licences, a number of other identity documents (from the UK

and abroad) and immigration stamps. Enquiries also resulted in the seizure of

laminators, embossing machines and computers. Financial investigations

have secured £180,000 in cash seizures, £150,000 in confiscation orders

and £12,000 cash forfeited. In addition, over £1 million in other assets have

been identified and are awaiting restraint.

As a result of this success the UKPS has agreed to provide a further secondee

to another Operation Maxim team to be set up in July 2004.

Operation Primeline

A long-term investigation by officers from the UKPS and the Metropolitan

Police uncovered numerous false passport applications being submitted in

the London and South Coast areas with similar characteristics. From over 100

passport applications made by the main suspect, 43 passports were issued.

An arrest was made in April 2003. Following a lengthy court case the

defendant was found guilty in February 2004 on 28 counts of obtaining and

attempting to obtain passports by deception, and was sentenced to six years

for each charge (to run concurrently).

The Judge presiding over the case described the accused as ‘a thoroughly

dishonest man who set up a sophisticated system to circumvent the checks’.

Intelligence Unit of Operation Maxim, which is working with Metropolitan Police and

UK Immigration Service colleagues as part of a co-ordinated response to tackling

organised immigration fraud. These secondments will continue until 2006.

>>

EFFICIENCY AND FINANCE

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ACHIEVING OPERATIONALEFFICIENCY AND BUSINESSASSURANCE

We have continued to improve financial

performance and drive forward

efficiency throughout the organisation.

In 2003–04 our operating surplus after

FCO costs was £29.1 million, against a

target of £15.4 million. The extra money

was used to pay off the remaining £26.7

million of past deficits.

The additional surplus was generated

by higher than expected demand being

serviced by current staffing levels.

We have supported the Government’s

commitment on payment to suppliers by

paying 99% of all invoices received

within 30 days of receipt.

Financial probity and assurance (or

internal controls) are overseen by an

audit committee that is chaired by a

Non-Executive Director (with two others

as members) and meets on a quarterly

basis.

An Efficiency Plan has been developed

and a series of points of action have

been approved by the Board.

Mechanisms are being put in place to

track outcomes.

Improve Productivity

Unit cost performance was considerably

stronger than expected during the year,

through higher rates of staff

productivity.

This productivity improvement was

achieved through controlling

expenditure by maintaining the current

staff numbers, while experiencing

higher than expected demand.

Process Mapping

A business process mapping exercise

was commenced in each office during

the year. The focus of the exercise was

to map our key processes and highlight

any variations from office to office.

Numerous workshop sessions have

been held at each location for all key

processes, with business process maps

being developed.

Thirteen key processes have been fully

mapped and these are now available to

staff via our intranet, ‘Inform’. Work is

continuing to identify and remove

differences in processes, in an effort to

drive consistency and maximise the

productivity of processing activities.

Maintain Effective ContractManagement

To ensure better value for money and

more coherent management of our

relationships with our partner service

providers, a Commercial Director was

appointed in September 2003. By the

end of the financial year, savings of over

1% on non-payroll spend had been

gained through more effective

procurement arrangements. The

Commercial Director is also assessing

income generation opportunities for the

UKPS as part of its wider market

activities.

During the year the UKPS also

successfully undertook mid-term

contract reviews with its two major

outsourced service providers (SBS and

SPSL). The reviews ensured we continue

to provide value for money to the public

and strengthened our relationships with

our partners.

Risk and Assurance

The UKPS Board continued to review a

regularly updated list of the top ten

escalated risks to the service each

month throughout the year, and further

developed risk management

arrangements below Board level. The

UKPS did not need to implement its

large-scale business continuity plans

during the year. However, plans were

tested in a series of exercises as well as

some minor incidents, and have been

reviewed accordingly.

The Agency’s risk and assurance

functions were formally aligned in the

year to recognise the close

interdependencies of the functions.

Comprehensive risk registers are

maintained at each level of the

organisation for both operations and

change projects, with close attention

paid to the timely execution of

mitigation actions.

During the year Pricewaterhouse

Coopers delivered internal audit

services for the first year of a five-year

contract.

Full details of our internal control

system can be found at pages 30–32 of

the Accounts.

‘Congratulations onbeing the most efficientservice outlet I have everexperienced.’

Hedley Coombs, Hants

‘Congratulations on yourvery fast service.’

Lesley-Anne Wise,Cornwall

ACHIEVING THROUGH PEOPLE

16

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WORKING TOGETHER

• Teamwork to achieve results

• Supporting colleagues in new roles

CUSTOMER SERVICE

• Providing the best possible standards ofcustomer care

• Treating all customers with respect

HONESTY AND INTEGRITY

• Being open and frank about issues

• Behaving in a professional manner at all times

OUR PEOPLE

• Having the skills to do the job

• Being recognised for a job well done

PERSONAL RESPONSIBILITY

• Being accountable for what you do

• Learning from mistakes, not blaming others

*Our values symbols were designed by Lisa Phillipson from the Durham Passport Office, with most of thesymbols being based on British Sign Language

DELIVERING A DIFFERENCE

We value

UNLOCKING STAFFPOTENTIAL

The UKPS places a high priority on

ensuring its staff feel valued and

empowered. Based on the results of the

last staff survey, the UKPS has

embarked on a programme to address

areas of concern to staff and improve

levels of staff satisfaction. A number of

initiatives were pursued during

2003–04 including the launch of a set

of corporate values and the continuing

development of a new performance

management system.

A set of valued behaviours have been

developed and these will support the

recruitment and selection process of

the UKPS as well as potentially being an

integral part of the new performance

management system.

Training and Development of Staff

During the year, the UKPS invested 4.1%

of its salary costs on training and

developing staff, below our target of

4.5%. The delay of some programmes

such as those supporting the Integrated

Pay and Performance Management

System caused this shortfall. However,

extensive training was still delivered to

all levels within the organisation.

The senior management team has

taken part in a 360º appraisal exercise

and a leadership development

programme is now being implemented

to enable senior managers to develop

their personal and collective capability

to strategically lead the UKPS, and to

create an environment where staff can

positively rise to the challenges facing

the Agency.

A middle-manager programme has

been developed and implemented, and

will be expanded over the coming year.

Existing modules have been refreshed

for the First-Line Practical Manager

programme to achieve Institute for

Leadership and Management

accreditation.

Tender documents are being prepared

to transfer the examiner training

modules into e-learning units, to be

implemented across the business

during the Autumn of 2004. On

successful completion of all e-learning

units, examiners will be awarded an

internally-accredited certificate.

The UKPS has continued to support

non-vocational training via the Agency

Lifelong Learning scheme. During the

year 154 staff took part in a wide range

of vocational and non-vocational

activities, including learning languages,

studying health and social care

practice, and learning IT skills.

Integrated Pay and PerformanceManagement System

The year 2003–04 saw the introduction

of a corporate office bonus scheme,

where staff can earn a bonus of up to

£200 if pre-agreed targets are achieved

by the office. A bonus scheme for

members of the senior management

team has also been launched.

18


Work was pursued on a new

performance management system,

however its introduction has been put

on hold and re-evaluated following the

results of a ballot of PCS (our trade

union) members. It is clear that staff

need further information on the system

prior to its introduction and aspects will

potentially require redesign.

Re-accreditation as an Investor inPeople

The UKPS was formally re-recognised as

an Investors in People (IiP) organisation

in June 2003. The IiP assessor did

identify some areas for improvement

but these were not significant enough

for the organisation not to be re-

recognised, and they are now receiving

further attention. A staff survey

undertaken in July 2003 revealed that

progress had been made in key areas

but there were still some areas that

needed attention, very much mirroring

what the IiP assessor had identified.

These are the subject of a combined

Investors in People and Staff Survey

action plan and remedial action is

underway.

Implementation of DiversityAction Plan

The UKPS’s commitment to diversity is

borne out by the results of the Staff

Survey. There is a comprehensive

diversity strategy in place and a

dedicated Diversity Manager oversees

the implementation of the diversity

action plan.

Diversity is about valuing our

differences and this ethos is the

cornerstone of the UKPS’s approach to

diversity in the workplace. Diversity is

treated as the responsibility of each

member of staff. During 2003–04

diversity activities included:

• a ‘buddy system’

• a mentoring programme

• comprehensive policies addressing

workplace bullying and harassment

• family-friendly policies including

paternity and adoption.

Disability forums continue to operate in

UKPS offices with disabled employees.

The forums are run by disabled

employees for disabled employees.

These forums feed into a central Home

Office disability forum, which feeds

back to ministers. The UKPS employs

167 disabled staff (6.9% of the total

average number of staff).

Full details of our diversity performance

can be found at Annex (d) of this

document.

Development of Career Paths

As part of the revised performance

management system, a revised career

path for examiner staff has been

proposed. The path consists of four job

roles – from newly recruited examiner to

‘Super’ examiner – and reflects the

skills and experience a person will gain

during the course of their career.

STOP PRESS

The UKPS is on the shortlist for

the prestigious Carl Bertelsmann

Prize 2004, awarded for

Organisational Culture and

Leadership in the Public Sector.

Staff Survey Results

• 58% of staff believe they have a good work/life balance

• 83% of staff understand the need for change

• satisfaction with the way performance is managed has increased by 12%

• development of line managers has improved

• we are firmly committed to equality of opportunity.

Areas for improvement

• information available to staff

• help to apply for promotion

• more feedback on individual performance

• management of change.

‘Your staff are FIRSTCLASS.’

Jeremy Usher-Smith,Kincussie

A Healthcare Programme

Influenza vaccinations were available to

all members of staff; 429 took

advantage of this during the year. A

health assessment programme has

been developed and offered to all staff,

with 1,000 taking part. An employee

counselling and welfare service is

available (available to staff 24 hours a

day, and known as the Employee

Assistance Programme (EAP)) and

individuals seeking to return to work

after a period of absence are offered

the opportunity to have an occupational

health assessment.

Partnership with PCS

Following the signing of the Partnership

Agreement with the Public and

Commercial Services Union (PCS) in

May 2002, the management of UKPS

has remained committed to working

closely with the Union. Despite

2003–04 being a challenging year,

employee relations within the UKPS

have continued to remain positive.

Focus Days have been held with senior

managers and national officers during

the year to discuss future developments

within the UKPS when the input from

the Union was extremely valuable.

A new Managing Attendance procedure,

which was developed in partnership

with PCS, was introduced in February

2004. Its aim is to reduce absence

within the organisation, which will

continue to be monitored throughout

the year.

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‘I was greeted bysmiling, cheerful andextremely helpfulpeople.’

Graham Coley,Peterborough

Brightsparks

We continued to support a staff suggestion scheme during 2003–04.

Launched in February 2003, the scheme is now one year old and has received

over 1,000 suggestions and made £5,330 in awards. A number of suggestions

made through the scheme have provided significant benefits to the

organisation.

Suggestions made and implemented during 2003–04 included:

• a number of changes to the PASS computer system to improve efficiency

and usability

• introduction of a Tannoy system to announce customer names in the

London office improved customer service and simplified communication

procedures

• a suggestion to introduce a deaf awareness course for all staff, resulted in

the planned implementation of a workshop for staff on working and dealing

with people with disabilities.

>>

INNOVATION AND DEVELOPMENT

20

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MAXIMISING THE USE OFTECHNOLOGY

The UKPS is aware of the need to make

best possible use of technology in

support of its business. It must ensure it

develops systems to support the

growing number of customers that wish

to access services online, as well as

using technology to stay one step ahead

of fraudsters and criminals.

IT Strategy

In support of its vision, the UKPS has

undertaken a substantial review of how

it uses technology to provide customer

services and manage its business. Work

was commissioned to develop a long-

term IT strategy and this has now been

completed. It is clear from the work

carried out that the existing passport

application processing system (PASS)

will need to be progressively replaced

over the next five years to cope with new

demands: a new modular-structured

system is needed to facilitate the scale

of anticipated change in the years

ahead. The way we manage customer

information will also be improved via the

introduction of a person-centric rather

than passport-centric data storage

arrangement.

Person-centric Database

As part of the review of IT within the

UKPS, a feasibility study concluded that

a person-centric database will better

support our fraud prevention activities

and the UKPS’s role in the

Government’s ID card programme. This

will be implemented during 2004–05.

ePassport

The UKPS has been progressing

analysis and development of an

ePassport incorporating an

International Civil Aviation Organization

standard facial biometric. The first

ePassports are expected to be rolled-

out in late 2005/early 2006.

Development of ManagementInformation Systems

Work continued during 2003–04 to

develop a wholly integrated management

information system for the UKPS

management team. The first stage of the

project has been completed with the

launch of a Flexible Reporting System

across all offices. This system provides

up-to-the-minute information on

business performance to management

teams within our regional offices.

Internal IT Systems

During the year, several improvements

were made to the PASS system in

support of new customer service

initiatives, including the lost, stolen and

recovered database and electronic

payment for online applications.

Remote access to enable some staff to

work from home was also introduced

during the year.

‘Congratulations on awell-designed andstructured website.’

Mike Goodwin, Exeter

Biometric Trial

The UKPS is currently undertaking

a biometric trial (with 10,000

volunteers), which is investigating

the options for fingerprinting

and/or iris scanning for use in

future passports.

Photo: Des Browne MP, Minister of State forCitizenship, Immigration and Nationality

‘I have rarely used sucha “user-friendly”website. The forms andprocesses were sosimple.’

Mrs C. McKie, Glasgow

>>

FUTURE PRIORITIES

22


Mission:Confirming

nationality andidentity –

enabling travel

Vision:To focus on stronger

identityauthentication for

the purpose ofissuing passports

Strategic objectives Aims

Identity authentication Safeguarding document integrity

Prevent identity fraud

Internal fraud prevention

Responding to customer needs

To ensure that entitled customers are able to travelfreely

To ensure that customers are satisfied with theservice

Unlocking staff potential

To develop a new ‘valued behaviours’ framework

To deliver a quality learning and developmentprogramme to meet individual and business needs

To reform existing performance managementarrangements linked to pay reform

To continue to focus on excellent internalcommunications

To manage attendance and poor performance

Efficiency and business assurance

To be significantly more efficient in everything we do

To establish sound finances to support businesscontinuity and change

To comply with regulatory requirements

Optimising the use of technology Optimising the use of technology

The UKPS recognises that it can only

meet the needs of its stakeholders if it

continues to provide excellence in

customer service while ensuring the

highest integrity of passport application

processes and the security of the

passport document. Future activities

will support both customer service and

fraud prevention and detection. The

UKPS will continue to drive forward

quality improvement and ensure that it

develops staff to their full potential. It

will ensure that it provides not only high

standards of customer service but that

it does so in an effective and efficient

manner making best use of IT.

The Corporate and Business Plan,

published in March 2004, sets out its

strategy for 2004–09. The planned

Integrated Change Programme contains

eight strategic projects supported by a

number of enabling projects. The eight

strategic projects are discussed below.

AUTHENTICATION BYINTERVIEW

As part of its fraud prevention strategy a

feasibility study is being carried out into

whether or not personal attendance

should be required for some or all

customers applying for adult passports

for the first time. Moving to personal

attendance would require a complete

overhaul of existing structures and

consideration is being given to the

potential implications for customers

and the UKPS.

PERSONAL IDENTIFICATIONPROJECT (PIP)

Throughout the year the UKPS trialled

the use of access to private and public

23

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sector databases (with applicant

consent) to assess whether identity

authentication is strengthened, and the

operational implications of this.

A decision will be made by the end of

2004 as to whether to roll-out PIP to all

offices and to integrate it into our

standard processes.

ONS ONLINE

Work has begun on establishing an

electronic link to the Office of National

Statistics (ONS) births, marriages and

deaths database. This link will help

eliminate reliance on paper

documentation, enhance customer

service, and help eliminate some types

of fraud.

LOST, STOLEN ANDRECOVERED (LSR)DATABASE

In late 2003 the UKPS successfully

launched a global lost, stolen and

recovered (LSR) passport database, in

order to combat individuals who apply

for passports using false

documentation, including forged

passports.

The UKPS will be developing usage of

the database with the FCO, the UK

Police Service, IND and internationally

through Interpol.

ePASSPORT

Work is continuing to develop systems

to incorporate biometric information

into passports. The first ePassports with

biometric chips inserted will be rolled-

out in late 2005/early 2006.

FACIAL RECOGNITION

The UKPS is in the process of

developing the use of facial recognition

technology to detect fraudulent

applications. In the first instance we will

be piloting the use of facial recognition

to compare each applicant’s facial

image against our stop-file images of

known fraudsters to complement

current stop-file data checks.

SECOND BIOMETRIC

A trial to determine the most

appropriate biometric for future needs

began in late 2003–04 (continuing into

2004–05), and will involve 10,000

volunteers providing facial, iris pattern

and fingerprint data.

This trial will help inform the UKPS and

partner organisations on implementing,

if appropriate, a second biometric to

passport documents. A second

biometric will help deter and detect

duplicate applications, and strengthen

the link between passport/ID cards and

the individual holder.

PASSPORT CARDS

A passport card is under consideration.

The card would enable travel

throughout the whole of the EU. The

card would also potentially form part of

the Government’s proposed identity

card programme from 2008.

>>

CORPORATE AND SOCIALRESPONSIBILITY

24


The UKPS is committed to its

customers, employees, the

environment and, in the wider context,

the community at large. The UKPS

believes that in the long term it must act

in a responsible manner creating

benefits for all of its stakeholders. This

ethos underpins the decision-making

process within the organisation.

Account is taken of external influences

that are likely to impact on our future

business. We also assess the impact

our decisions will have on stakeholders,

developing strategies to minimise

potential difficulties.

ECONOMIC FACTORS

The UKPS is a self-funded Agency,

reliant wholly on the fee income it

generates. We are committed to

managing our resources in a prudent

manner to ensure that increases in fees

are only sought when necessary and

that the level of increase is kept to a

minimum for our customers.

SOCIAL FACTORS

The UKPS has a positive role to play in

the communities in which it operates,

benefiting both customers and

employees. Providing excellence in

customer service is a key priority for the

Service, balancing this against the need

for improved security measures. Our

human resources policies are

structured to attract and retain the best

people to achieve this goal. The UKPS is

committed to:

1. Complying with regulatory

requirements.

2. Providing a safe, secure and healthy

working environment for its

employees.

3. Ensuring managers are committed to

the health and well-being of their

staff.

4. Promoting equality of opportunity for

all. Ensuring that individuals

progress within the organisation by

talent alone.

5. Treating all stakeholders with

courtesy and respect.

6. Communicating openly and honestly

with all stakeholders – both

internally and externally.

7. Regularly reviewing our policies to

ensure we are maintaining our

commitment to our stakeholders.

The UKPS engages it stakeholders

through various media and

communications including staff

newsletters, an intranet, our website,

the staff briefing system, and through

members of the Consultative Panel

(made up of representatives from the

travel industry, Citizens Advice Bureau,

DfES, and the FCO, amongst others).

ENVIRONMENTAL FACTORS

The UKPS is aware of the impact its

operations has on the environment and

is working to reduce this. Our ‘Green’

strategy sets out four key areas on

which we will focus our efforts. These

are:

1. Reducing consumption of natural

resources.

2. Recycling schemes at all locations.

3. Setting Key Performance Indicators

to measure progress.

4. Promoting our strategy to all

employees and seeking their active

involvement in initiatives.

ACCOUNTS AND NOTES

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HISTORY ANDBACKGROUND

The United Kingdom Passport Agency

was established as an Executive Agency

of the Home Office on 2 April 1991

under the Government’s Next Steps

initiative.

In March 2001, the Agency was

renamed the Passport and Records

Agency (PRA) to encompass the two

distinct operating arms within the

Agency, the United Kingdom Passport

Service (UKPS) and the Criminal

Records Bureau (CRB). Following a

review of CRB operations and

strategies, the CRB became an

independent Executive Agency of the

Home Office on 1 September 2003 and

the UKPS reverted back to separate

Agency status.

PRINCIPAL ACTIVITIES

The function of the UKPS is to provide

passport services for British nationals

in the UK. Its main objectives are set out

on page 1 of the Annual Report.

Performance against key targets is

described on the inside front cover of

this Annual Report. For the year ended

31 March 2004 the UKPS made a

surplus of £29.1 million, which has

eliminated past deficits accumulated

under agreement with HM Treasury.

BASIS FOR PREPARING THEACCOUNTS

A Treasury Direction requires the UKPS

to produce the accounts to conform with

the accounting principles and

disclosure requirements of the

Resource Accounting Manual (RAM) in

respect of 2003/2004 and future

years, in accordance with section 7(2)

of the Government Resources and

Accounts Act 2000.

The UKPS uses the Companies Act

1985 Schedule 4 format 1.

BUSINESS AND FUTUREDEVELOPMENTS

The UKPS continues to seek and to

deliver improvements in the quality,

value for money and efficiency of the

current service provided to its

customers, in line with the service and

financial targets set by Ministers. At the

same time the UKPS has implemented

a series of change projects over recent

years and is now planning a more

integrated change programme.

Integrated Change Programme(ICP)

The UKPS operating environment is

complex and challenging, playing a key

role in dealing with the challenges of

illegal immigration, identity fraud and

the threat of international terrorism. The

UKPS is also a key participant in the

implementation of the government’s

proposed national identity card

scheme. In order to meet these

challenges a newly defined Integrated

Change Programme (ICP) has been

established and a new Programme

Director appointed to oversee delivery

of the key strategic elements of the ICP:

• Authentication by interview

• Personal Identification Project (PIP)

• Online access to

birth/marriage/death records

• Lost, stolen and recovered passport

database (LSR)

• ePassport

• Facial recognition to detect fraud

• Biometric trial and second biometric

• Passport cards.

Additionally, there are a number of key

enabling projects supporting the

initiatives above.

Delivery of the key elements of the ICP

will achieve the UKPS core strategic

objectives of stronger identity

authentication and greater document

security. Throughout delivery of the ICP,

the UKPS will continue to ensure

members of the public continue to

receive their passports on time and

correctly issued, with progressive

strengthening of anti-fraud measures.

More detail on the ICP is contained on

pages 22 to 23 of the Annual Report.

Fixed Assets

During the year, the UKPS made

significant capital investment in three

major areas, Liverpool office relocation,

development of a new electronic

passport application system and a lost,

stolen and recovered passport

database. More information on fixed

assets is included within note 9 to these

accounts.

FOREWORD TO THE ACCOUNTS

26


Management Information

Business process maps for our key

processes have been delivered during

the year and will be a key management

tool in delivering improved consistency,

quality and efficiency across all offices.

Work on delivering an Enterprise Data

Warehouse (EDW) has begun with

planned delivery during 2005. This will

facilitate far more flexible reporting

arrangements and access to

information throughout UKPS,

integrating data from the operations,

finance and human resource systems. A

project to deliver a new finance and

procurement system is underway to

support e-commerce, enhanced

financial analysis and cost modelling. A

comprehensive IT strategy was

developed during the year and further

detail on this is included on page 21 of

the Annual Report.

Net Regime

The UKPS continues to operate under a

net regime for resource expenditure.

Capital expenditure is funded by the

Home Office. All receipts are paid into a

UKPS account held with the Office of

the Paymaster General. The UKPS then

Appropriate in Aid from this account

sufficient receipts to cover expenditure,

including consular services overseas

provided by the Foreign and

Commonwealth Office, and then pay the

surplus to Home Office as Consolidated

Fund Extra Receipts (CFERs). We will

continue to review whether there is a

business case for the UKPS to progress

to Trading Fund status in the future.

Outsourcing

Contracts were awarded in July 1997 to

Siemens Business Services (SBS) and

the security printing division of The

Stationery Office in Manchester (now

Security Printing and Systems Ltd –

SPSL).

In 2003 the UKPS reached the mid

point of these contracts and a review, as

required by the contracts, took place.

This resulted in small unit price

increases for both SBS and SPSL,

consistent with the terms of the original

contracts.

In addition to the operational service

charges levied by SBS, we have also

invested during the year in developing

improvements to the Passport

Application Support System (PASS) to

facilitate future services such as

Electronic Passport Applications (EPA)

and the introduction of some key anti-

fraud initiatives.

Fee Increase

On 2 October 2003 the UKPS

introduced higher fees for all our

services to facilitate the introduction of

the ICP improvements to our systems,

whilst maintaining the integrity of the

British passport through improved

arrangements to tackle fraud. This

increase allows the UKPS to continue to

provide a consistently high quality

service to our customers within an

increasingly secure environment and

makes provision for significant past

deficit recovery (to be fully recovered by

October 2004 as agreed with HM

Treasury), increased FCO consular

protection costs (see below) and an

inflationary element.

There is an element within the passport

fee for consular protection costs

overseas – effectively an insurance

premium. The element of this FCO

premium within the services (post and

pre fee increase shown respectively)

are:

• Adult passports £9.65 (£9.40)

• Child passports £2.41 (£2.35)

• Jumbo passports £14.49 (£14.10).

The UKPS turnover is shown gross of the

total amount £40.7 million of this

premium in the Income and Expenditure

account.

Identity Issues

The UKPS continues to strive to ensure

the British passport remains amongst

the most secure worldwide and

continues to improve security. In order

to improve fraud prevention and

detection, a number of significant

projects were delivered during the year,

including creating specialist fraud and

intelligence units in all offices, the

launch of a global passport database

(Omnibase), improved arrangements for

reporting, recording and sharing

information on lost, stolen and

recovered (LSR) passports and the

introduction of secure delivery of all

passports nationwide in partnership

with Special Mail Services (SMS).

Following the Home Secretary’s

announcement on identity cards on 11

November 2003, the UKPS is

committed to playing a key role in the

delivery of the national identity card

scheme. The implication of this

announcement is that the UKPS will be

responsible for, or active in, a

programme of key projects to enable

the delivery of a national ID card. The ID

card programme is being managed by

the Home Office ID Card Programme

Board on which the UKPS is

represented. Draft legislation was

submitted to Parliament on 26 April

2004 and is now subject to a period of

public consultation with the intention

then to formally legislate in the

Parliamentary session beginning in the

autumn 2004. Note 23, post balance

sheet events, provides more detail on

the launch of a biometric trial to capture

facial, iris and fingerprint details of

10,000 volunteers. This trial was

launched in April 2004 and aims to test

the technology for biometric capture.

More detail on this subject is contained

on page 21 of the Annual Report and in

Home Office publications.

Corporate Governance

These accounts incorporate a

statement on the UKPS system of

internal controls. It is in line with the

requirements of the Turnbull report on

Corporate Governance as set out in

Chapter 21 of Government Accounting

2000.

27

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The content of the statement is

supported by the work carried out by the

UKPS internal audit service, the

contract for which was awarded to

PricewaterhouseCoopers in 2003, and

by external audit, as well as other

reviews that cover internal financial

control of the UKPS. The UKPS Audit

Committee meets quarterly to oversee

all audit work carried out and is

supported by business assurance

committees that also meet quarterly.

The system of internal control is based

on an ongoing process designed to

identify the principal risks to the

achievement of the UKPS’s plans,

policies and objectives, to evaluate the

nature and extent of those risks and to

manage them efficiently, effectively and

economically. In order to strengthen

UKPS corporate governance, the

functions of risk and business

assurance were merged to form the

Risk and Assurance Team.

The Comptroller and Auditor General is

the external auditor of the UKPS

supported by the National Audit Office

and is appointed under statute,

reporting to Parliament. For the

statutory audit carried out on this

Annual Report and Accounts, the UKPS

paid a notional fee to the NAO of £137k.

In order to further strengthen the UKPS

governance arrangements, a third Non

Executive Director was appointed to the

Management Board providing further

external challenge and wide experience

beyond the UKPS. Further Executive

Directors have been appointed to

strengthen the Agency in the Strategic

Planning, Commercial, Marketing and

Communication, Programme

Management and Identity Project areas.

Full details of the Board and Directors

are included in Annex (a) of the Annual

Report.

Pension Scheme

Comprehensive details of the various

pension schemes available to UKPS

employees are contained within notes 6

and 14 to these accounts.

Efficiency Strategy

An Efficiency Board has been

established to develop and oversee

delivery of the UKPS efficiency strategy,

established in line with both the

increasing government focus on

efficiency and the strong internal driver

of needing to limit the impact of the ICP

on the passport fee. The strategy

includes a focus on process re-

engineering and greater automation as

well as driving forward shorter-term

productivity improvement through

improved management and

management information.

Resource Accounting andBudgeting

The Home Office is preparing resource

accounts for 2003/2004 which will

consolidate the UKPS accounts. The

UKPS provides accounting data to the

Home Office on a monthly basis.

Consistency of accounting policies and

treatment has been assisted by the

requirement on both parties to prepare

accounts in accordance with the RAM.

Euro

The UKPS is keeping closely in touch

with developments on the Euro and is

taking steps to ensure that its financial

and operational systems can be flexibly

adapted to facilitate the Euro as and

when required.

Liverpool Relocation

During the year the UKPS made

significant progress in the construction of

new accommodation for the Liverpool

office in the city centre. Building work is

complete with fit-out well underway. The

new building is planned to be open in

October 2004 and will provide better

quality and more modern and flexible

accommodation for staff and customers.

Call Centre

The UKPS continued to develop its

contact centre service during the year to

help deal with the large volume of

enquiries from the public, which

exceeded three million calls during

2003/2004. Changes will be introduced

to make the PASS system available to the

call centre to enhance the service to

customers enquiring on progress of

applications. This service is anticipated to

be fully operational by September 2004.

PAYMENT PERFORMANCE

The UKPS’s payment performance is

outlined on the inside cover of the

Annual Report.

RESEARCH ANDDEVELOPMENT

The UKPS has continued to undertake

research into the factors influencing the

volume and pattern of demand for

passports. The UKPS continues to

implement improvements to the

passport issuing process through the

use of digital and biometric technology.

All these costs are charged to the

Income and Expenditure Account.

MANAGEMENT BOARD

The names, positions and brief

personal details of the Management

Board are as set out in Annex (a) of the

Annual Report. The Chief Executive is a

permanent member of staff appointed

by the Home Office under Senior Civil

Service terms. Executive Directors’

remuneration is within the UKPS agreed

pay scales adjusted by the

Remuneration Committee where

appropriate to effect reasonable

comparison with similar roles within the

Civil Service. Full details on

remuneration of the Management

Board are contained within note 6 to

these accounts.

>>

28


UNLOCKING STAFFPOTENTIAL

Full details of the UKPS’s staff

initiatives, including the development

and launch of a set of corporate valued

behaviours, are set out on pages 17 to

19 of the Annual Report.

DIVERSITY

The UKPS is committed to diversity and

opportunity. Our main objective is to

promote and develop diversity

initiatives within the organisation, with a

view to matching and, if possible,

improving on best practice within the

Civil Service.

Since developing our Equal

Opportunities Policy, the UKPS has

undertaken a number of equal

opportunities initiatives. The

organisation has concentrated on

ensuring the equal treatment of groups

disadvantaged in employment. As a

consequence, the UKPS has developed

an anti-harassment and workplace

bullying policy, family-friendly initiatives

such as the provision of childcare

vouchers, part-time and job-share

opportunities, and taking part in the

Guaranteed Interview Scheme. Special

efforts are being made to encourage job

applications and applications for

promotion from black and ethnic

minorities, with the intention of

ensuring staff from minority groups

reach their true potential and all offices

fully reflect their local communities. The

UKPS has also developed a diversity

strategy designed to promote social

inclusiveness within the UKPS.

During the year the UKPS made no

charitable donations.

EMPLOYMENT OFDISABLED PEOPLE

The UKPS employs 167 disabled staff

(6.9% of total average number of staff)

and there is an Equality Manager who is

responsible for overseeing

implementation of the policy.

HEALTH AND SAFETY

The UKPS is committed to maintaining

the standards required by the Health

and Safety at Work Act 1974, and other

United Kingdom and European

regulations relating to the health and

safety of its employees and the public.

Resources have been strengthened in

this area and the UKPS will continue to

raise staff awareness on all aspects of

Health and Safety. A healthcare

screening and a flu vaccination

programme exists for all UKPS staff.

PARTNERSHIP AGREEMENTWITH THE TRADE UNION

The UKPS will continue to work closely

with colleagues in the Public and

Commercial Services Union (PCS),

building on the partnership agreement

signed in 2002.

INFORMATIONTECHNOLOGY

Full details covering the UKPS’s IT

systems and website services are

included on page 21 of the Annual

Report.

Bernard Herdan

Chief Executive

18 June 2004

>>

30


ANNUAL STATEMENT ON INTERNAL CONTROL

1 Scope of responsibility

As Accounting Officer, I have

responsibility for maintaining a sound

system of internal control that supports

the achievement of the United Kingdom

Passport Service’s (UKPS) policies,

aims and objectives, whilst

safeguarding the public funds and

departmental assets for which I am

responsible, in accordance with the

responsibilities assigned to me in

Government Accounting.

The UKPS is an Executive Agency of the

Home Office. As Accounting Officer I am

fully accountable for the running,

management, performance and future

development of the UKPS.

2 The purpose of the system ofinternal control

The system of internal control is

designed to manage risk to a

reasonable level, rather than to

eliminate all risk of failure to achieve

policies, aims and objectives; it can

therefore only provide reasonable and

not absolute assurance of

effectiveness. The system of internal

control is based on an ongoing process

designed to identify and prioritise the

risks to the achievement of the UKPS’s

policies, aims and objectives, to

evaluate the likelihood of those risks

being realised, and their impact should

they be realised, and to manage them

efficiently, effectively and economically.

The system of internal control has been

in place in the UKPS for the year ended

31 March 2004 and up to the date of

approval of the Annual Report and

Accounts, and accords with HM

Treasury guidance.

3 Capacity to handle risk

A central component of the way in which

the UKPS gives leadership and direction

to the risk management process is the

risk management strategy that I have

endorsed through the Board and Audit

Committee. This strategy reflects

appropriate elements of the Home

Office risk management strategy and is

subject to regular review.

Further leadership is given to the risk

management process by the UKPS

Management Board, supported by a

Risk Assurance Group, which maintains

a strategic risk register reviewed by

representatives from all directorates.

Managers are accountable for the

management and mitigation of risks

within their area of responsibility.

Guidance in risk management is given to

staff by risk management framework

and guidance documents. We seek to

learn from best practice by taking an

active part in the Home Office Risk

Improvement Forum and by individual

benchmarking with other government

departments and agencies. The UKPS

Risk Assurance function takes a lead in

the identification and dissemination of

best practice.

As part of the UKPS risk management

strategy, my Head of Risk and Assurance

undertakes risk review workshops, one

to one interviews, round table

discussions and seminars as part of the

plan to ensure that awareness is raised

and that staff are trained to manage risk

in a way appropriate to their

accountabilities and responsibilities,

goals and objectives. This activity has

taken place in the UKPS throughout

2003/2004 and will continue, to ensure

that these processes are fully applied in

all areas of the business.

A revised risk management strategy

document was produced in November

2003, as part of a process of

continuous improvement. In addition, a

series of functional and senior

management risk and assurance

workshops have been undertaken. I

consider that this moves action forward

to continue to develop an embedded

risk and assurance management

culture throughout the organisation.

4 The risk and control framework

The Board has adopted a risk

management strategy. Risk appetite is

determined by the Board in the

prioritisation of objectives within the

corporate planning process.

The UKPS has established the following

processes to identify, evaluate and

control risk:

• A Management Board that meets

monthly, with a standing item

relating to significant risk and

assurance issues.

• An Audit Committee that meets on a

quarterly basis, chaired by a Non

Executive Director, and including the

Chief Executive and the two other

Non Executive Directors.

• Regular reports by internal audit, to

GIAS standards, which include

recommendations for improvement.

The UKPS internal audit services are

provided on an outsourced basis.

• Individual risk registers, which will be

integrated during 2004/2005 to

incorporate regional office,

directorate and corporate risks into a

single database. During the current

year the most significant risks

identified have been summarised in

a strategic risk register for

31

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consideration by the UKPS

Management Board.

• A Risk Assurance Group which meets

on a monthly basis to review UKPS

risk management, business

assurance and business continuity

arrangements. This is a sub group to

the Management Board, with a

dotted line to the Audit Committee,

reporting on an exception basis

where there are significant areas of

risk.

• A self-assessment process of Internal

Certificates of Assurance, carried out

by UKPS senior managers, which is

used to inform internal letters of

assurance. The whole framework for

these certificates, including

supporting documentation, will be

developed in 2004/2005.

• Internal compliance reviews in other

key areas of risk, including policy, the

PASS passport processing system,

HR and finance systems.

• Given the nature of the UKPS’s

business, I also have a separate

Security Team, with a Head of

Security reporting to the Director of

Operations who is responsible for

informing the Management Board

and Audit Committee on all matters

of passport security. Internal control

in this respect is also exercised by a

developing system of checks

designed to mitigate the risks of

passport fraud.

• Business continuity plans to manage

the risks of loss of key premises and

processes.

• Strengthening of the strategic

planning, programme and

commercial function.

• A third Non Executive Director, who

was previously a member of the

Advisory Board, has been appointed

in the course of the financial year.

• Significant investment in the year has

been put into developing business

process maps for a number of key

processes, with the scope of this

activity being widened to encompass

all processes going forward. These

are supporting the identification of

‘one best way processes’ for the

business that is helping to drive

consistency of application in areas

such as case noting of decisions on

passport entitlement and Main Index

updating. As such it is helping the

UKPS to deal with a long-standing

issue in a very positive way.

Risk priorities in the year have been:

• Maintenance of high levels of

operational performance against

record demand levels.

• Development of the capability to

deliver a significant integrated

change programme. A Programme

Office has been established to

oversee the UKPS Integrated Change

Programme, and to implement best

practice for project and programme

management. An experienced

Programme Director was appointed

towards the end of the financial year

to direct this work. The UKPS Change

Programme is overseen by the

Integrated Change Programme

Board, which meets on a monthly

basis.

• Counter fraud activity.

• Involvement in the ID card

programme.

5 Review of effectiveness

As Accounting Officer, I have

responsibility for reviewing the

effectiveness of the system of internal

control. My review of the effectiveness of

the system of internal control is informed

by the work of the internal auditors and

the executive managers within UKPS

who have responsibility for the

development and maintenance of the

internal control framework, and

comments made by the external

auditors in their management letter and

other reports.

In addition to the monthly review of

significant corporate risks, the UKPS

Management Board has included on its

agenda an annual review of strategic

risk management. The Audit Committee

meets quarterly and oversees the

system of internal control, receiving

reports from the UKPS internal auditors,

and NAO, as external auditors. My

directors provide me with annual

certificates giving me assurance on the

systems of internal control for which they

are individually responsible, identifying

any control weaknesses, together with

their plans to address these.

My Head of Risk and Assurance acts as

Risk Improvement Manager, reporting

to my Director of Finance, and is

responsible for developing and

improving the UKPS risk management

capability. We will review the UKPS risk

management capability and

effectiveness in the forthcoming year,

using the HM Treasury Risk Assessment

framework.

Assurance activities are further

informed by, facilitated and supported

by the Risk Assurance Group, which

meets on a monthly basis to address

the key elements of Risk Management,

Business Assurance and Business

Continuity. A plan to address

weaknesses and ensure continuous

improvement of the system is in place.

A risk-based approach to internal audit

activity has been followed in the current

financial year, with a supporting

programme of activity, which is

approved by the Audit Committee.

Internal audit comment relevant to the

Statement on Internal Control is as

follows:

‘Our work revealed significant

weaknesses in the procurement and

payroll systems, which led to our

concluding that the controls over these

systems were operating inadequately.

Management has put action plans in

place to seek to address these issues.

Our audit work in other areas did not

indicate that these weaknesses were

systematic across the risk

management, governance

arrangements or controls within UKPS.

Consequently, other than procurement

and payroll, our work has demonstrated

>>

32


that, overall, controls reviewed were

adequate but there is further scope to

improve the risk management,

governance and internal control

processes in line with emerging best

practice’.

6 Significant internal controlissues

The UKPS is operating in an

environment of significant change, both

in respect of normal operations as a

result of major increases in demand,

and also in respect of developments in

its methods of operation to meet new

technological and fraud prevention

objectives. This presents a number of

challenges, which the UKPS is

endeavouring to meet in part by

ensuring that it has the right skills and

resources in place. This action is

progressive, particularly in the

programme office to ensure effective

delivery of the UKPS Integrated Change

Programme.

A wide range of challenging business

and financial targets and tasks have

been achieved in the year and the UKPS

is starting to drive forward and deliver

significant outcomes in terms of its

developing identity verification and

fraud prevention agenda.

Management believed that aspects of

control in the areas of procurement and

payroll services were weak, from the

perspective of inefficient processes and

not due to any suspicion of fraud. These

areas were therefore tested and the

results corroborated by Internal Audit,

and their detailed findings have

enabled robust action plans to be

developed and driven forward.

The Agency’s Programme function was

embryonic, whilst developing at a fast

rate, during the financial year. Some

high level assurance has been achieved

on Programme controls during

2003/2004 from OGC Gateway and

Home Office reviews and more detailed

audit and assurance arrangements are

being developed to ensure that key

Programme controls are in place and

operating consistently.

Actions are also being driven forward,

aided by findings from an internal audit

review, to strengthen blank passport

book stock management processes, as

a key control over document security.

The UKPS has already more closely

aligned its risk and assurance functions

and will strive to make a bigger impact

in these areas with a stronger risk and

assurance focus in all areas of the

business and closer planning,

resourcing and management against

key risks. This will focus on

improvements in self assurance and

risk management processes, supported

by a training programme based on a

new risk tool to be implemented in the

early part of 2004/2005 financial year.

My review of the effectiveness of the

system of internal control is informed by

the work of the internal auditors and the

executive managers within the UKPS

who have responsibility for the

development and maintenance of the

internal control framework, and

comments made by the external

auditors in their management letter and

other reports. I have been advised on

the implications of the results of my

review of the effectiveness of the

system of internal control by the

Management Board, the Audit

Committee, the Risk Assurance Group

and a plan to address weaknesses and

ensure continuous improvement of the

system is in place.

Bernard Herdan

Chief Executive

18 June 2004

33

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UNITED KINGDOM PASSPORT SERVICETHE CERTIFICATE AND REPORT OF THE COMPTROLLERAND AUDITOR GENERAL TO THE HOUSE OF COMMONS

I certify that I have audited the financialstatements on pages 34 to 51 under theGovernment Resources and AccountsAct 2000. These financial statementshave been prepared under the historicalcost convention as modified by therevaluation of certain fixed assets andthe accounting policies set out on pages37 and 38.

RESPECTIVERESPONSIBILITIES OF THEAGENCY, THE CHIEFEXECUTIVE AND AUDITOR

As described on page 29, the UKPS andChief Executive are responsible for thepreparation of the financial statements inaccordance with the GovernmentResources and Accounts Act 2000 andTreasury directions made thereunder andfor ensuring the regularity of financialtransactions. The Agency and ChiefExecutive are also responsible for thepreparation of the other contents of theAnnual Report. My responsibilities, asindependent auditor, are established bystatute and I have regard to the standardsand guidance issued by the AuditingPractices Board and the ethical guidanceapplicable to the auditing profession.

I report my opinion as to whether thefinancial statements give a true and fairview and are properly prepared inaccordance with the GovernmentResources and Accounts Act 2000 andTreasury directions made thereunder,and whether in all material respects theexpenditure and income have beenapplied to the purposes intended byParliament and the financial transactionsconform to the authorities which governthem. I also report if, in my opinion, theForeword is not consistent with thefinancial statements, if the Agency hasnot kept proper accounting records, or if I

have not received all the information andexplanations I require for my audit.

I read the other information contained inthe Annual Report and consider whetherit is consistent with the audited financialstatements. I consider the implicationsfor my certificate if I become aware of anyapparent misstatements or materialinconsistencies with the financialstatements.

I review whether the statement on pages30 to 32 reflects the Agency’s compliancewith Treasury’s guidance on theStatement on Internal Control. I report if itdoes not meet the requirements specifiedby Treasury, or if the statement ismisleading or inconsistent with otherinformation I am aware of from my auditof the financial statements. I am notrequired to consider, nor have Iconsidered whether the AccountingOfficer’s Statement on Internal Controlcovers all risks and controls. I am also notrequired to form an opinion on theeffectiveness of the Agency’s corporategovernance procedures or its risk andcontrol procedures.

BASIS OF AUDIT OPINION

I conducted my audit in accordance withUnited Kingdom Auditing Standardsissued by the Auditing Practices Board. Anaudit includes examination, on a testbasis, of evidence relevant to theamounts, disclosures and regularity offinancial transactions included in thefinancial statements. It also includes anassessment of the significant estimatesand judgements made by the Agency andChief Executive in the preparation of thefinancial statements, and of whether theaccounting policies are appropriate to theAgency’s circumstances, consistentlyapplied and adequately disclosed.

I planned and performed my audit so asto obtain all the information andexplanations which I considerednecessary in order to provide me withsufficient evidence to give reasonableassurance that the financial statementsare free from material misstatement,whether caused by error, or by fraud orother irregularity and that, in all materialrespects, the expenditure and incomehave been applied to the purposesintended by Parliament and [the financialtransactions] conform to the authoritieswhich govern them. In forming my opinionI have also evaluated the overalladequacy of the presentation ofinformation in the financial statements.

OPINION

In my opinion:

• The financial statements give a trueand fair view of the state of affairs ofthe United Kingdom Passport Serviceat 31 March 2004 and of the surplus,total recognised gains and losses andcash flows for the year then ended andhave been properly prepared inaccordance with the GovernmentResources and Accounts Act 2000and directions made thereunder byTreasury; and

• In all material respects theexpenditure and income have beenapplied to the purposes intended byParliament and the financialtransactions conform to theauthorities which govern them.

I have no observations to make onthese financial statements.

John Bourn Comptroller and Auditor General National Audit Office 157–197 Buckingham Palace Road Victoria London SW1W 9SP29 June 2004

>

>>

34


ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2004

UNITED KINGDOM PASSPORT SERVICE INCOME AND EXPENDITURE ACCOUNT FOR THE YEAR ENDED 31 MARCH 2004

NOTES 2003/2004 2002/2003

£000 £000

Turnover from continuing activities 2 197,541 152,971

Cost of sales 3 (82,344) (78,412)

Gross surplus 115,197 74,559

Distribution costs 4 (5,538) (3,133)

Administrative expenses 5 (41,649) (36,081)

(47,187) (39,214)

68,010 35,345

Other operating income 1.10 2,853 3,272

Operating surplus 1.8, 7 70,863 38,617

Loss on disposal of fixed assets (33) (12)

Cost of capital 8 (1,050) (1,387)

Surplus on ordinary activities 69,780 37,218

Non-retainable element of the passport fee

for consular protection 21 (40,650) (33,539)

Surplus /(deficit) after deducting non-retainable

element of the passport fee 29,130 3,679

STATEMENT OF RECOGNISED GAINS & LOSSES FOR THE YEAR ENDED 31 MARCH 2004

2003/2004 2002/2003

£000 £000


Unrealised surplus on the revaluation of assets 441 587

Gains recognised for the year 70,221 37,805

35

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UNITED KINGDOM PASSPORT SERVICEBALANCE SHEET AS AT 31 MARCH 2004

2003/2004 2002/2003

NOTES £000 £000 £000

Fixed assets

Tangible assets 9 31,637 24,546

Current assets

Stocks 3,734 4,353

Work in progress 396 487

Debtors 10 10,981 15,759

Cash at bank and in hand 16 41,597 30,698

56,708 51,297

Creditors

Amounts falling due within one year 11a (67,696) (41,461)

Bank overdraft 16 (2,241) (1,605)

(69,937) (43,066)

Net current assets/(liabilities) (13,229) 8,231

Total assets less current liabilities 18,408 32,777

Creditors Amounts falling due after more

than one year 11b (3,400) (3,800)

Provisions for liabilities and charges 12 (548) (119)

14,460 28,858

Taxpayer's equity

General fund 13a 12,981 27,784

Revaluation reserve 13b 1,479 1,074

14,460 28,858

Bernard Herdan

Chief Executive

18 June 2004

The notes on pages 37 to 51 form part of these accounts.

36


UNITED KINGDOM PASSPORT SERVICECASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2004

NOTES 2003/2004 2002/2003

£000 £000

Net cash inflow from operating activities 87,850 73,148

Capital expenditure and financial investment (11,048) (8,371)

Net cash flow from financing (66,539) (40,217)

Increase in cash in the year 16 10,263 24,560

Reconciliation of operating cost to operating cash inflows

Net operating surplus 70,863 38,617

Adjust for non cash transactions 15a 4,845 48,344

Adjust for movements in working capital other than cash 15b 12,453 (5,309)

Adjust for VAT payments made 15c (10,322) (11,054)

Adjust for VAT receipts 10,011 2,550

Net cash inflow from operating activities 87,850 73,148

Analysis of capital expenditure and financial investment

Purchase of fixed assets 9 (11,048) (8,394)

Proceeds from fixed asset disposal - 23

Net cash outflow from investment activities (11,048) (8,371)

Analysis of financing

Cash funding from Home Office to General Trading account * - 44,415

Cash collected and paid over to Home Office 21 (66,539) (84,632)

Net cash funding to Home Office (66,539) (40,217)

*Cash movements prior to the transfer of ownership of the PGO account from the Home Office, October 2002

37

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

NOTES TO THE ACCOUNTSFor the year ended 31 March 2004

1 Accounting policies

The accounts are prepared using the

historic cost convention modified by the

inclusion of fixed assets at current cost.

Without limiting the information given,

the accounts meet the accounting and

disclosure requirements of the

Resource Accounting Manual (RAM),

the Companies Act 1985 and the

accounting standards issued or

adopted by the Accounting Standards

Board so far as these requirements are

relevant.

1.1 Tangible fixed assets

(a) Motor vehicles

The motor vehicle used to transport

internal post around London is

capitalised and will be written off over 5

years.

(b) Furniture and fittings

New furniture and fittings to facilitate

the operation of Passport Application

Support System (PASS) are capitalised

and written off over 10 years.

(c) Refurbishment

All refurbishment work in regional

offices is capitalised over the length of

the lease agreements.

(d) Telecoms

All telecommunications equipment

such as video conference equipment

and PBX with a value over £750 is

capitalised and written off over 5 years.

e) Electrical equipment

All electrical equipment such as

computers and printers with a value

over £750 is capitalised and written off

over 5 years.

f) IT development

Projects, which involve IT development

expenditure, are capitalised when

incurred on projects that will improve

our services to the public. The

expenditure is capitalised as a tangible

asset and is depreciated over the

expected useful life of the benefits

envisaged, limited to a maximum of 5

years. There is no de minimus level set

for capitalisation of IT development

costs.

g) Assets under construction

All tangible assets being developed and

not in operation at year end are

capitalised as an asset under

construction. No depreciation is

recognised until these assets are

brought into use.

h) Revaluation

The UKPS is required to disclose fixed

assets in the balance sheet at current

cost. The UKPS’s policy is to revalue by

applying appropriate indices compiled

by the Office of National Statistics to

each class of asset (excluding IT

development).

i) Depreciation

A full year’s depreciation is provided on

all tangible fixed assets in the year of

acquisition at rates calculated to write

off the cost or valuation of each asset

evenly over its expected useful life as

follows:

Motor vehicles 5 years

Furniture and fittings 10 years

Refurbishment over the

period of the

lease

Telecoms 5 years

Electrical equipment 5 years

IT development 5 years

j) Research

All research expenditure is written off as

incurred.

Expenditure on development in

connection with a product or service,

which is to be supplied on a full cost

recovery basis, is capitalised if it meets

the criteria specified in SSAP 13. Other

development expenditure is capitalised

if it meets the criteria specified in the

RAM which are adapted from SSAP 13

to take account of the not-for-profit

context.

Expenditure, which does not meet the

criteria for capitalisation, is treated as

an operating cost in the year in which it

is incurred. Fixed assets acquired for

use in research and development are

depreciated over the life of the

associated project, or according to the

asset category if the asset is to be used

for subsequent production work.

k) Capitalisation

The minimum level for capitalisation of

tangible fixed assets (excluding

furniture and fittings and IT

development) is £750 per item.

Costs associated with the Public Private

Partnership contracts are not

capitalised in the UKPS’s Balance Sheet

in line with all relevant guidance.

1.2 Operating leases

Rental payments for land and buildings

occupied by the UKPS on the basis of

operating leases are charged to the

Income and Expenditure Account on a

straight line basis over the lease term.

Lease incentive income received is

deferred over the term of the lease on a

straight line basis. This accounting

treatment is in line with Urgent Issue

Task Force 28.

1.3 Stocks

Stocks are valued at the lower of current

replacement cost and net realisable

value and comprise of new digital

passport blanks (including the

contingency stock) and image transfer

sheets.

Because of uncertainty at this time

regarding the Biometrics Project,

contingency stock of standard blank

passports held at the Bank of England

are valued at cost.

1.4 Work in progress

Work in Progress (WIP) is valued using

three elements:

• the number of applications which

have been passed for issue by the

38


UKPS but not printed by Security

Printing and Systems Ltd (SPSL) are

valued at the Siemens unit charge to

reflect the UKPS’s liability to

Siemens for this work.

• the above number of applications

are also valued at average UKPS

direct labour cost in March 2004 at

each office.

• the number of applications which

have not been completed by the

UKPS’s examiners are valued at an

appropriate proportion of the

average direct labour cost in March

2004.

Work in progress in Siemens is not

deemed to be owned by the UKPS and is

therefore excluded from UKPS WIP

count as no liability for these

applications has been incurred by the

UKPS at this stage.

1.5 Non-cash costs

In accordance with the Resource

Accounting Manual a non cash cost at

the appropriate rate is included for

Interest on Capital. Amounts are also

included for central Home Office costs

for Payroll, Accounts Branch and for

National Audit Office audit fees.

1.6 Turnover from continuingactivities

Turnover from continuing activities

represents the sale value of all services

provided during the year.

All income is deferred until the passport

is issued.

1.7 Funding

The UKPS is funded on a net resource

basis from Home Office Request for

Resources 1 – subhead g.

1.8 Surplus

The surplus of income over expenditure

generated by the UKPS is intended to

meet the cost of passport and non-fee

bearing consular services overseas

provided by the Foreign and

Commonwealth Office (FCO). This non-

retainable element of the passport fee

for consular protection is paid to the

Treasury via the Home Office. Any

surplus remaining after the FCO

contribution has been surrendered to

the Consolidated Fund, is paid via the

Home Office on a cash basis.

1.9 Pension costs

The UKPS participates in the Principal

Civil Service Pension Scheme. This is a

statutory defined benefit scheme. The

UKPS is required to pay an employer’s

contribution, which is currently between

11% and 18.5% of pensionable pay

depending on the grade of staff.

These contributions are charged to

operating expenses as and when they

become due.

In accordance with the Resource

Accounting Manual, the costs of

employees retiring under the approved

early retirement scheme are charged in

full to the Income and Expenditure

Account in the year of departure. For

those retiring under the 80:20 scheme,

a provision is made for the future

liability relating to the proportion of the

costs to be met by the UKPS. The

balance is credited to the General Fund.

As the provision is utilised it is credited

to the General Fund.

1.10 Other operating income

Other operating income represents

miscellaneous receipts including wider

market income and Invest to Save

funding.

1.11 Public Private PartnershipContracts

The UKPS has accounted for Public

Private Partnership in accordance with

the Treasury Taskforce Guidance

Technical Note 1 Revised ‘How to

account for PFI transactions’.

39

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

2 Turnover from continuing activities

2003/2004 2002/2003

£000 £000

Standard Passport Services 197,541 152,971

197,541 152,971

All activities are governed by the Consular Fees Act 1980 and so far as segmental reporting requirements are concerned are

considered to be one single class of business.

3 Cost of sales

2003/2004 2002/2003

£000 £000

Labour costs 32,884 32,790

Bank charges 276 201

PIMIS maintenance* – 173

Passport stationery 1,004 787

Application forms 1,938 1,446

Outsourcing service charges** 41,672 38,947

Telecommunication charges, including call centre charges 4,570 4,068

82,344 78,412

* Final PIMIS maintenance obligation in 2002/2003: PASS roll-out fully implemented.** Outsourcing service charges include payments to Siemens Business Services for initial receipt, cashiering and data capturing of applications and to Security

Printing and Systems Ltd for manufacturing, personalisation and issue of digital passports. A budget of £3.8m has been agreed with Siemens BusinessServices for technical refreshment which will be ongoing throughout the remaining term of the contract.

4 Distribution costs

2003/2004 2002/2003

£000 £000

Postal charges 2,369 2,450

Secure Delivery * 2,682 –

Application form distribution 487 683

5,538 3,133

* The Secure Delivery programme was implemented in February 2004.

40


6 Staff costsa The total remuneration for the year of the Chief Executive, the highest paid member of the Management

Board was:

2003/2004 2002/2003

£ £

Mr Bernard Herdan 153,601 151,667

153,601 151,667

The Chief Executive's pay is covered by the Senior Civil Service pay arrangements and he is an ordinary member of the Civil

Service Pension Scheme (see note 14). Mr Herdan's remuneration includes an allowance for home to office travel as per his

contract.

5 Administrative expenditure

2003/2004 2002/2003

£000 £000

Staff 17,070 14,597

Accommodation 7,227 6,377

Other costs 6,737 5,609

IT running costs 3,372 2,966

Telecoms charges 904 1,127

Publications, stationery and printing 1,544 1,651

Depreciation 4,163 2,977

Diminution in assets 201 251

Non cash costs

HO Payroll and Accounts Branch 294 316

External audit Fees 137 137

Internal audit Fees* – 73

431 526

41,649 36,081

* The UKPS internal audit function is now carried out by PricewaterhouseCoopers and is no longer a non cash item. The costs are now reflected in the 'Other costs'section of this note.

41

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

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c Total staff costs were:

2003/2004 2002/2003

£000 £000

Salaries 40,540 38,415

Earnings related National Insurance 2,500 2,087

Superannuation (note 14) 4,866 4,646

Travel and subsistence 2,048 2,239

49,954 47,387

These costs have been included in the Income & Expenditure Account as follows:

2003/2004 2002/2003

£000 £000

Cost of sales (note 3) 32,884 32,790

Administrative expenses (note 5) 17,070 14,597

49,954 47,387

d The average number of employees on the Agency payroll during the period, including seasonal staff, was:

2003/2004 2002/2003

Number Number

Management 626 570

Administration 269 272

Production 1,524 1,542

2,419 2,384

43

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

7 Operating surplus

2003/2004 2002/2003

£000 £000

The surplus for the period is shown after charging:

Hire of Plant & Machinery 380 386

Bad debts 17 446

Depreciation 4,163 2,977

External audit fees* 137 137

Internal audit fees* 139 73

* The auditors have received no remuneration for non audit work.

8 Interest on capital

2003/2004 2002/2003

£000 £000

A notional interest on capital charge is made, calculated in accordance

with the Treasury guidelines at a rate of 3.5% (2002/2003: 6%)

Cost of capital 1,050 1,387

e Remuneration of the Non Executive Directors

Under the new UKPS Governance arrangements the Advisory Board was disbanded in January 2003. There are now

three Non Executive Directors: Jim Michie, John Holden and Linda Walton. During 2003/2004 Jim Michie received

£28,986 for his services as a member of the UKPS Management Board and as the Chair of the UKPS Audit Committee

(2002/2003: £17,500 relating to 2002/2003 plus an additional payment of £5,000, relating to 2001/2002). John

Holden, a Non Executive Director, received £14,097 for his services as a member of the UKPS Management Board and

UKPS Audit Committee (2002/2003: £11,600). Linda Walton, a Non Executive Director, received remuneration from

UKPS, the total costs in the year were £15,594 of which £10,250 (£3,000 to be paid in 2004/2005) has been received

for her services relating to the Passport Verification Service project (2002/2003: £2,500). Christine Ashton, an Advisory

Board member in 2002/2003, received no remuneration from UKPS during 2003/2004 as she left due to the

disbandment of the Advisory Board in January 2003 (2002/2003: Total costs £2,000).

44


9 Tangible fixed assets

Motor Vehicle Furniture and Electrical Telecoms Refurbishment IT Assets Under TotalFittings Equipment Equipment Development Construction

£000 £000 £000 £000 £000 £000 £000 £000

Cost or valuation

At 1 April 2003 6 3,622 2,978 1,497 19,853 2,841 1,139 31,936

Additions – 88 1,086 26 1,417 3,108 5,323 11,048

Revaluation – – – – 510 – – 510

Diminution – (6) (187) (8) – – – (201)

Disposals – (1) (82) (40) – – – (123)

Transfer of assets into use – – – – – 1,139 (1,139) –

At 31 March 2004 6 3,703 3,795 1,475 21,780 7,088 5,323 43,170

Depreciation

At 1 April 2003 2 1,865 1,379 699 2,877 568 – 7,390

On disposals – – (49) (40) – – – (89)

Charge for year 1 240 760 270 1,515 1,418 – 4,204

Backlog depreciation – (2) (36) (3) 69 – – 28

At 31 March 2004 3 2,103 2,054 926 4,461 1,986 – 11,533

Net book value 31 March 2004 3 1,600 1,741 549 17,319 5,102 5,323 31,637

Net book value

31 March 2003 4 1,757 1,599 798 16,976 2,273 1,139 24,546

10 Debtors *

2003/2004 2002/2003

£000 £000

Trade Debtors 36 36

HMG Debtors 3,226 7,070

Staff Debtors 208 195

Prepayments and Accrued Income 5,171 2,136

Partnership Debtors** 2,340 6,322

10,981 15,759

* All debtors shown above fall due within one year.

**The balance due from POL at the end of the period was £2.3m (2002/2003: £6.2m) see note 21.

45

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

11a Creditors: Amounts falling due within one year*

2003/2004 2002/2003

£000 £000

Trade creditors 4,121 3,457

Other creditors ** 4,719 –

Deferred income 6,377 2,678

Accruals 11,182 4,876

Amounts due to Home Office general cash account 41,297 30,450

67,696 41,461

* The 'General Trading' bank account has been removed from the 'Creditors: Amounts falling due within one year’ and shown on the face of the Balance Sheet as 'Bank Overdraft'.

** Included within 'Other Creditors' is £4.6m. This represents the non-retainable element of the passport fee for consular protection for March 2004 which is still owed to the Treasury.

11b Creditors: Amounts falling due after more than one year

2003/2004 2002/2003

£000 £000

Deferred Income * 3,400 3,800

3,400 3,800

* This represents the deferred income arising from a lease incentive received on the re-leasing of Globe House, London.

12 Provisions for liabilities and charges

2003/2004 2002/2003

£000 £000

Balance at 1 April 119 179

Amount utilised (71) (81)

Arising in the year – Early retirement 50 21

Arising in the year – POL* 450 –

Balance at 31 March 548 119

*Represents the obligation to Post Office Limited for the potential invoicing discrepancy of passport fees.

46


13 Reconciliation of movements in Government funds:

13a General fund

2003/2004 2002/2003

£000 £000

Balance at 1 April 27,784 16,862


Non-retainable element of the passport fee for consular protection* (40,650) (16,363)

Transfer from revaluation reserve 36 42

VAT Recovered by Home Office (4,153) (6,676)

Non cash cost 431 526

Amounts owed to the Home Office (41,297) (30,450)

Cost of capital 1,050 1,387

Removal of amounts owed to Home Office 2001/2002 – 4,523

Payroll funded by the Home Office* – 43,983

Refunds* – 586

Fees paid over to Home Office* – (68,269)

Receipts from Home Office to fund Trading account* – 44,415

Balance at 31 March 12,981 27,784

* Amounts in 2002/2003 represents the period from April to September 2002, reflecting movements prior to the transfer of ownership of the PGO account from

the Home Office in October 2002.

The UKPS made a surplus of £29.1m (after deducting non retainable element of the passport fee) which has eliminated past

deficits accumulated under agreement with HM Treasury.

13b Revaluation reserve

2003/2004 2002/2003

£000 £000

Balance at 1 April 1,074 529

Movement in Year 510 637

Backlog Depreciation (unrealised) (69) (50)

Movement to General Fund (36) (42)

Balance at 31 March 1,479 1,074

The revaluation reserve represents the difference between the net book value of the fixed assets on a revalued basis and on an

historic cost basis where the revalued amount is higher.

47

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

14 Pension costs

The PCSPS is an unfunded multi-

employer defined benefit scheme but

the UKPS is unable to identify its share

of the underlying assets and liabilities.

A full actuarial valuation was carried out

at 31 March 1999, details of which can

be found in the resource accounts of the

Cabinet Office: Civil Superannuation

(www.civilservice-pensions.gov.uk).

The conditions of the Superannuation

Acts 1965 and 1972 and subsequent

amendments apply to those employees

of the UKPS who are Civil Servants. For

year to date contributions of £4.9m

were paid to the PCSPS at between 11%

and 18.5% of salary as determined by

the Government Actuary and advised by

the Treasury.

Pension benefits are provided through

the Civil Service pension arrangements.

From 1 October 2002, civil servants

may be in one of three statutory based

‘final salary’ defined benefit schemes

(classic, premium, and classic plus).

New entrants after 1 October 2002 may

choose between membership of

premium or joining a good quality

money purchase stakeholder based

arrangement with a significant

employer contribution (partnership

pension account).

(a) Classic scheme

Benefits accrue at the rate of 1/80th of

pensionable salary for each year of

service. In addition, a lump sum

equivalent to three years' pension is

payable on retirement. Members pay

contributions of 1.5 per cent of

pensionable earnings. On the death of

a member with two or more years'

qualifying service, pensions are payable

to the surviving spouse at a rate of half

the member's pension. On death in

service, the scheme pays a lump sum

benefit of twice pensionable pay (to the

member's nominee) and also provides a

service enhancement on computing the

spouse's pension. The enhancement

depends on length of service and

cannot exceed 10 years. Medical

retirement is possible in the event of

serious ill health. In this case, pensions

are brought into payment immediately

without actuarial reduction and with

service enhanced as for widow(er)

pensions.

(b) Premium scheme

Benefits accrue at the rate of 1/60th of

final pensionable earnings for each year

of service. Unlike classic, there is no

automatic lump sum, but members may

commute some of their pension to

provide a lump sum up to a maximum of

3/80ths of final pensionable earnings

for each year of service or 2.25 times

pension if greater (the commutation

rate is £12 of lump sum for each £1 of

pension given up). For the purposes of

pension disclosure the tables assume

maximum commutation.

Members pay contributions of 3.5 per

cent of pensionable earnings. On the

death of a member with two or more

years' qualifying service, pensions are

payable to the surviving spouse or

eligible partner at a rate of 3/8ths the

member's pension (before any

commutation). On death in service, the

scheme pays a lump-sum benefit of

three times pensionable earnings (to

the member's nominee(s)) and also

provides a service enhancement on

computing the spouse's or eligible

partner's pension. The enhancement

depends on length of service and

cannot exceed 10 years. Medical

retirement is possible in the event of

serious ill health. In this case, pensions

are brought into payment immediately

without actuarial reduction. Where the

member's ill health is such that it

permanently prevents them

undertaking any gainful employment,

service is enhanced to what they would

have accrued at age 60.

(c) Classic plus scheme

This is essentially a variation of

premium, but with benefits in respect of

service before 1 October 2002

calculated broadly as per classic.

Pensions payable under classic,

premium, and classic plus are

increased in line with the Retail Prices

Index.

(d) Partnership pension account

This is a stakeholder-type arrangement

where the employer pays a basic

contribution of between 3% and 12.5%

(depending on the age of the member)

into a stakeholder pension product. The

employee does not have to contribute

but where they do make contributions,

these will be matched by the employer

up to a limit of 3% (in addition to the

employer's basic contribution).

Employers also contribute a further

0.8% of pensionable salary to cover the

cost of risk benefit cover (death in

service and ill health retirement). The

member may retire at any time between

the ages of 50 and 75 and use the

accumulated fund to purchase a

pension. The member may choose to

take up 25% of the fund as a lump sum.

The death in service lump sum benefit

is three times pensionable earnings.

48


15a Non cash transactions

2003/2004 2002/2003

£000 £000

Depreciation charges (notes 5 and 9) 4,163 2,977

Notional charges (note 5) 431 526

Diminution of assets (note 5) 201 251

Early retirement provision (note 12) 50 21

Refunds* – 586

Payroll costs* – 43,983

4,845 48,344

* Amounts reflecting movements prior to the transfer of ownership of the PGO account from the Home Office, October 2002

15b Movements in working capital other than cash

2003/2004 2002/2003

£000 £000

Decrease/(Increase) in stocks 619 (2,113)

Decrease/(Increase) in work in progress 91 (368)

Decrease/(Increase) in debtors (excluding VAT) 937 (2,182)

Increase/(Decrease) in creditors (excluding GTA) 10,427 (565)

Increase/(Decrease) in provisions 379 (81)

12,453 (5,309)

15c VAT paid

2003/2004 2002/2003

£000 £000

Vat paid to suppliers in the year (10,322) (11,054)

(10,322) (11,054)

49

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

16 Analysis of movements in cash balances

2003/2004 2002/2003

£000 £000 £000

Opening balance 29,093 4,533

UKPS non-fee accounts (583) (1,367)

Fee accounts due to consolidated fund 10,846 25,927

Increase in cash 10,263 24,560

Closing balance 39,356 29,093

Balance at office of Paymaster General 26,990 28,080

Balance at commercial banks and cash in hand 14,607 2,618

Cash at Bank and in hand 41,597 30,698

Bank overdraft (2,241) (1,605)

Balance as at 31 March 39,356 29,093

17 Contingent liabilities

The ten year Public/Private Partnership Agreements with Siemens Business Services and Security Printing and Systems Ltd

contain termination and expiry clauses, which if activated by the Agency would result in financial liabilities being incurred. The

Agency believes that the likelihood of these liabilities materialising is remote, but as a possibility remains, are disclosed here for

completeness.

18 Lease obligations and other financial commitments

a The UKPS has annual commitments under operating leases which expire as follows:

Land and Buildings Other Total

£000 £000 £000

within one year – – –

between 2005/06 and 2009/10 2,044 967 3,011

after 31 March 2010 4,492 319 4,811

Total commitments under operating leases 6,536 1,286 7,822

b 2003/2004 was the sixth year of the ten-year contracts awarded under the Public/Private Partnership Initiative to

Siemens Business Services and Security Printing and Systems Ltd. The total award value of the two contracts over the full

ten years is estimated at £352m.

50


19 Capital commitments

As at 31 March 2004 UKPS had entered

into capital commitments of £0.5m for

the Liverpool relocation, £4.4m for the

EPA II project and £0.4m for the

'Improved Call Handling' project,

(2002/2003: total capital

commitments £0.7m).

20 Euro expenditure

As at 31 March 2004, the UKPS had

incurred no direct expenditure ensuring

the computerised systems are

compliant with the introduction of the

Euro. The UKPS is, however,

represented on the Home Office Euro

Steering and co-ordinators Groups.

21 Related parties

The United Kingdom Passport Service is

an Executive Agency of the Home Office

and is headed by a Chief Executive who

is responsible to the Secretary of State

for the Home Department.

The Home Office is regarded as a

related party. Material transactions

between the Home Office and the

Agency which occurred during the

period are as follows:

a) Amounts paid to the Home Office

during 2003/2004 totalled £66.5m,

which included: £36.1m for the non-

retainable element of the passport

fee and £30.4m CFER transfer from

2002/2003 (2002/2003: UKPS

paid the Home Office £84.6m and

received £44.4m). Additionally, the

UKPS payroll service is provided by

the Home Office Pay and Pension

Service (HOPPS) resulting in

transactions amounting to £45.7m

(2002/2003: £44.3m).

b) Net accommodation costs paid by

the Home Office during the year

amounted to £1.0m (2002/2003:

£1.0m).

The Foreign & Commonwealth Office

(FCO) is also regarded as a related party.

Prior to the fee increase in October

2003, the Agency collected £9.40 per

adult standard, £2.35 per child

passport and £14.10 per jumbo

passport to recover the cost incurred by

the FCO for providing consular

protection. From October 2003, £9.65,

£2.41 and £14.49 was collected

respectively. The total collected in

2003/2004 was £40.7m of which

£36.1m was paid in 2003/2004 to the

Treasury, via the Home Office

(2002/2003: £33.5m).

Other Government Departments and

Agencies which the UKPS transacted

with in the normal course of business

during the year include the Benefits

Agency, the Department for

Constitutional Affairs (formerly the Lord

Chancellors Department), the

Department for Trade and Industry, Her

Majesty's Customs & Excise, and the

Foreign and Commonwealth Office. The

UKPS had paid £1m to the Benefits

Agency and had received £12.3m from

the other agencies, the total value

amounted to £13.3m (2002/2003:

£10.8m).

Post Office Limited (POL) paid over

passport fees during the period

amounting to £76.5m (2002/2003:

£53.3m). The balance due from POL at

the end of the period was £2.3m

(2002/2003: £6.2m).

During the year none of the Board

Members, key management staff or

other related parties had undertaken

any transactions with the UKPS.

22 Financial instruments

FRS 13, Derivatives and Other Financial

Instruments, requires disclosure of the

role which financial instruments have

had during the period in creating or

changing the risks an entity faces in

undertaking its activities. Because of

the largely non-trading nature of its

activities and the way in which

government agencies are financed,

UKPS is not exposed to the degree of

financial risk faced by business entities.

Moreover, financial instruments play a

much more limited role in creating or

changing risk than would be typical of

the listed companies to which FRS 13

mainly applies. The UKPS has no

powers to borrow, invest surplus funds

or purchase foreign currency. Financial

assets and liabilities are generated by

day-to-day operational activities and are

not held to change the risks facing the

department in undertaking its activities.

As permitted by FRS 13, debtors and

creditors which mature or become

payable within 12 months from the

balance sheet date have been omitted

from the currency profile.

The UKPS has no borrowings and relies

primarily on funding from the Home

Office for its cash requirements, and is

therefore not exposed to liquidity risks.

It also has no material deposits, and all

material assets and liabilities are

denominated in sterling, so it is not

exposed to interest rate risk or currency

risk. The fair value of cash is the same

as the book value.

23 Post Balance Sheet events

A major step in the government’s plans

for introducing identity cards was

launched on 26 April 2004 when the

Agency began a six month trial to test

the technology for capturing facial, iris

and fingerprint biometric details from

10,000 members of the public. The

trial is funded by the Home Office and

will result in 3 staged payments to the

main contractor (ATOS Origin) based on

all equipment delivered and installed,

completion of the pilot and receipt of

the pilot report and findings. There will

be four sites participating in the trial

(London, Leicester, Newcastle and

Glasgow) and a mobile unit covering the

rest of the country.

51

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

24 Special payments

2003/2004 2002/2003

£000s £000s

Compensation to the Public 79 119

Compensation to Staff – Personal Injury 2 –

Compensation to Staff – Excluding Personal Injury 64 17

145 136

There were no individual 'Special Payments' made by UKPS, exceeding £100k.

>>

52


ACCOUNTS DIRECTION GIVEN BY THE TREASURY INACCORDANCE WITH SECTION 7 (2) OF THEGOVERNMENT RESOURCES AND ACCOUNTS ACT 2000

1. The UKPS will prepare accounts for the year ended 31 March 2004 in compliance

with the accounting principles and disclosure requirements of the edition of the

Resource Accounting Manual issued by HM Treasury which is in force for

2003–04.

2. The accounts shall be prepared so as to:

(a) give a true and fair view of the income and expenditure (or as appropriate, net

resource outturn), total recognised gains and losses (or, as appropriate,

recognised gains and losses), and cash flows of the Agency for the financial

year, and of the state of affairs as at 31 March 2004; and

(b) provide disclosure of any material expenditure or income that has not been

applied to the purposes intended by Parliament or material transactions that

have not conformed to the authorities which govern them.

3. Compliance with the requirements of the Resource Accounting Manual will, in all

but exceptional circumstances, be necessary for the accounts to give a true and

fair view. If, in these exceptional circumstances, compliance with the

requirements of the Resource Accounting Manual is inconsistent with the

requirement to give a true and fair view the requirements of the Resource

Accounting Manual should be departed from only to the extent necessary to give a

true and fair view. In such cases, informed and unbiased judgement should be

used to devise an appropriate alternative treatment which should be consistent

with both the economic characteristics of the circumstances concerned and the

spirit of the Resource Accounting Manual. Any material departure from the

Resource Accounting Manual should be discussed in the first instance with the

Treasury.

David Loweth

Head of the Central Accountancy Team, Her Majesty’s Treasury

30 January 2004

53

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

ANNEX (A)MEET THE MANAGEMENT TEAM

Bernard L. Herdan, MA(Cantab) Ceng, MIEE, DMS

Chief Executive, 56 years old

Bernard has had a varied career in the private and public sectors in the UK and

continental Europe. During the last 12 years, he was Commercial Director at the

Meteorological Office and Chief Executive of the Driving Standards Agency. He

joined the UKPS as Chief Executive in September 1999.

Kevin Sheehan

Director of Operations, 56 years old

Kevin joined the UKPS as Director of Planning and Resources in November

1992. He became Director of Operations in November 1996. He has extensive

management and policy experience within the Home Office.

Ruth Pearson, MBA, BA(Hons), FCIPD

Director of Human Resources, 46 years old

Ruth joined the UKPS in November 2002. She has held a series of Board roles

with a career spanning local government, the university sector and private

industry.

Alistair Cook, BA(Hons), CPFA

Director of Finance, 37 years old

Alistair joined the UKPS in 1994 after several years working for the National

Audit Office.

John Davies

Director of Systems, 58 years old

John joined the Civil Service in 1972 and specialises in systems development

and project management.

Christine Nickles

Director of Marketing and Communications, 53 years old

Christine joined the UKPS in April 2000, following four years with the Driving

Standards Agency. Her career has also encompassed local government,

charities and the private sector.

>>

54


Alan Wilkes, MBA, BSc (Hons)

Director of Strategic Planning, 33 years old

Alan joined the UKPS in September 2003. He has previously held positions with

international strategic and environmental consultancies, together with

undertaking scientific research in the natural gas industry.

Rob Bowley, BA (Hons)

Director – Identity Projects, 55 years old

Rob joined the UKPS as the Peterborough Regional Manager in 1987. He has

previously held Home Office posts in the Prison Service and civil defence, and

also spent some time as an immigration officer.

Diane Rampling, BA (Hons), ACIS, MCIPS

Commercial Director, 49 years old

Diane has a career background of senior procurement and commercial

positions in both the public and private sectors and joined the UKPS in

September 2003.

Jim Michie, CA

Non-Executive Director, 60 years old

Jim retired as a Director of Littlewoods Plc in October 2001. During the year he

held a non-executive role with the Criminal Records Bureau.

John Holden, MA (Cantab), FICM


John concluded his ‘first career’ in the oil industry as manager of BP’s European

Lubricants and Bitumen Business. He subsequently spent six years as Registrar

of Companies and Chief Executive of Companies House, a DTI Agency.

Linda Walton, BA(Hons), MCIPS, ACIB


Linda is a freelance consultant with a background in financial services,

operations, outsourcing and supplier management. She has held executive and

board level positions in banking and the credit card industry, and has held public

sector non-executive positions since 1994.

55

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

ANNEX (B) GLOSSARY OF TERMS

CRB Criminal Records Bureau

DfES Department for Education and Skills

DVLA Driver and Vehicle Licensing Agency

EU European Union

FCO Foreign and Commonwealth Office

FIUs Fraud and Intelligence Units

HR Human Resources

ICAO International Civil Aviation Organization

ICP Integrated Change Programme

ID card Identity Card

IiP Investor in People

IND Immigration and Nationality Directorate

LSR lost, stolen and recovered database

NCIS National Criminal Intelligence Service

ONS Office of National Statistics

PASS Passport Application Support System

PCS Public and Commercial Services Union

PIP Personal Identification Project

SBS Siemens Business Services

SPSL Security Printing and Systems Ltd

UKPS UK Passport Service

>>

56


ANNEX (C) UKPS PUBLICATION SCHEME

Corporate governance The UK Passport Service

statement of commitment

Printed version from the Business

Assurance Manager

X

Class Description Format/ Availability Charge

Investor in People The UK Passport Service action

plan to retain Investor in People

Printed version from the HR

Manager

X

X

X

X

X

X

Management meetings Agenda, minutes and

associated papers from the

Management Board and the

Consultative Panel of Passport

Users

Printed version from the Private

Office Manager (with some

information withheld on

commercial / security grounds)

Management of people Strategy for People

Diversity strategy

Training & Development

Strategy, review and policy

HR service level agreement

Pay & Pension Services service

level agreement

Staff handbook

Policy documents:

Printed version from the HR

Manager

Discipline

Grievance

Managing

attendance

Racial equality

Equal

Opportunities

Harassment,

bullying and

discrimination

Recruitment

and selection

Business plans and reports UK Passport Service Corporate

Plans

Regional Office and HQ

Directorate Business Plans

Annual Report and Accounts

Electronic version from

www.passport.gov.uk

Printed version from the Head of

Corporate Strategy

Staff surveys

Vital Signs Monthly report showing the UK

Passport service performance

against target

Printed version from the Finance

Manager

Results of staff surveys Printed version from the HR

Manager

57

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

Press notices Press notices from November

2002

www.passport.gov.uk X

Class Description Format/ Availability Charge

Contract management Notices of the UKPS contracts

advertised and awarded above

£100,410

Supplement to Official Journal of

the EC

www.europa.eu.int/eur-lex/en/

search-oj

X

X

X

X

X

Complaints handling Complaints procedures www.passport.gov.uk

Customer surveys Results of regular surveys of

UKPS’s customers

Printed version from the

Communications Manager

Job opportunities Vacancies within the UKPS www.passport.gov.uk

Newsletters Internal newsletter issues Printed version from the

Communications Manager

XWelsh Language Scheme Full details of our Welsh

Language Scheme

Printed version from the Customer

Services Manager

XEnvironmental impact The UKPS green policy Printed version from the Business

Planning Manager

X

National rate

X

Information for the public

and Parliament

Information on the services

available and general guidance

Additional information leaflets

www.passport.gov.uk

Adviceline: 0870 521 0410

Printed versions from the

Communications Manager or local

libraries and CABs

Note: An enquiry regarding any of the above is provided free of charge for the first hour, and then £20 per hour for each

subsequent hour, up to a maximum of 30 hours.

>>

58


ANNEX (D) DIVERSITY ACTIONS

The following table details employment figures for Black and Ethnic Minority (BEM) staff within the UKPS by grade; in total the

UKPS employs 15.6% BEM staff. The UKPS is disappointed that we no longer exceed the Government target for HEO grades as we

have done in previous years. To understand the reasons why and to strengthen our commitment to diversity actions we have

upgraded the role of our Diversity Manager and will be providing additional resources to these tasks.

Grade Government target for UKPS Difference Not specifiedemployment of BEM staff

PO1 – EO Unspecified 16.50% N/a 2.04%

HEO 11.0% 8.90% -2.10% 2.05%

SEO & Grade 7 3.5% 5.26% 1.76% 1.05%

Grade Female Male

PO1 – EO 66.6% 33.4%

HEO 58.2% 41.8%

SEO & Grade 7 41.2% 56.8%

The breakdown by gender is:

The organisation values its staff and makes an effort to be as flexible as possible, within operational constraints. The following

summary statistics provide evidence of this:

Childcare vouchers 100 staff have used childcare vouchers during the financial year

Part-time staff 309 staff work part time

Adoption leave 19 members of staff have used this during the year

Flexible working 80% of staff work flexible hours

Printed in the UK for The Stationery Office Limited on behalf of the Controller of Her Majesty's Stationery Office7/04, 65536, 171626

�

59

>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>>

FEEDBACK FORM

ANNUAL REPORT AND ACCOUNTS 2003–04

The UKPS is interested in your views, whether positive or negative, on this document. Any comments made on this questionnaire

will be used to improve our next Annual Report.

Q1. How did you receive this report? (Please tick as appropriate)

I am on the external distribution list From the Internet/Intranet Internal distribution

Purchased Other

Comments

Q2. What is your overall impression of the report? (Please tick as many as appropriate)

Informative Interesting Useful

Clearly written Easy to understand Complicated

Confusing Uninteresting Unstructured

Too long Too short Acceptable size

Comments

Q3. What do you like/dislike about the report? (Please tick as many as appropriate)

Like Dislike Like Dislike Like Dislike

Cover Page layout Colour scheme

Written style Photographs Graphs

Document layout Content

Comments

�

60


Q4. How easy did you find the report to read? (Please tick one box)

Very easy Easy Acceptable

Not very easy Difficult

Comments

Q5. How easy did you find the accounts to read? (Please tick one box)

Very easy Easy Acceptable

Not very easy Difficult

Comments

Q6. We would appreciate any other comments you have regarding this report, for example, what improvementswould you like to see made, and/or what additional information would you like to see featured in the report?

Comments

Thank you for taking time to fill in this questionnaire

We would be grateful if you could provide us with your name and organisation details, but there is no obligation.

Name:

Organisation:

Please return to: Corporate Strategy, Globe House, 89 Eccleston Square, LONDON, SW1V 1PN, Fax: 020 7901 2468, or e-mail:

[email protected]

�

Passport errorsTo reduce the level of passportsreturned with errors after issue to0.25% (reduced from 0.33% in2002–03)

Not met: The level of passportsreturned with errors after issuewas reduced to 0.27%

Although the target was not met,the 0.27% error rate is asignificant improvement on2002–03 when the error ratewas 0.38%


Customer satisfactionTo ensure a customersatisfaction rate of 93%

TurnaroundTo ensure that 99.5% ofstraightforward partner andpostal applications are turnedaround within 10 days

To ensure that 99.5% ofPremium and Fast Track servicesare turned around within theguaranteed period

Appointment timesTo ensure that 92% ofcustomers are seen within 20minutes of their appointmenttime

Telephone callsTo ensure that 90% oftelephone calls are answeredwithin 20 seconds

Exceeded: 95% of customerswere seen within 20 minutes oftheir appointment time

Exceeded: 99.9% ofstraightforward partner and postalapplications were turned aroundwithin 10 days, despite demandvolumes of 7% above plan

Partly met: 99.5% of Fast Trackapplications were processedwithin service standards; 98.8%of Premium service applicationswere processed within servicestandards

Exceeded: The averagecustomer satisfaction rate was98%

Not met: The number oftelephone calls answeredwithin 20 seconds was 89%

The volume of calls, at 3.3million, were 3% higher than2002–03

90%

92%

94%

96%

98%

100%

1999–00 2000–01 2001–02 2002–03 2003–04

Actual

Target

Customer satisfaction

Turnaround of postal and partner applications within 10 days

98.4%

98.6%

98.8%

99.0%

99.2%

99.4%

99.6%

99.8%

100.0%

2000–01 2001–02 2002–03 2003–04

Actual

Target

Customers seen within 20 mins of appointment

84%

86%

88%

90%

92%

94%

96%

98%

100%

2001–02 2002–03 2003–04

Actual

Target

86%

87%

88%

89%

90%

91%

92%

2000–01 2001–02 2002–03 2003–04

Actual

Target

Telephone calls answered within 20 seconds

0.00%

0.05%

0.10%

0.15%

0.20%

0.25%

0.30%

0.35%

0.40%

2000–01 2001–02 2002–03 2003–04

Returnedpassports

Target

Average number of passports returned with error

The staff satisfaction survey isundertaken every two years, and waslast completed in 2002–03. At thattime, 77% of staff were satisfied withtheir job

A new survey is due for completionin early 2005

Staff developmentTo invest 4.5% of salary cost intraining and development

Staff turnoverTo ensure staff turnover ratedoes not exceed 12%

Not met: The percentage ofsalary cost spent on training anddevelopment was 4.1%

Exceeded: The staff turnover ratefor the year was 9.1%


Unit costTo achieve a unit cost of £24.41

Surplus/deficitTo achieve a surplus, after FCOcosts, of £15.4 million

Staff absenceTo ensure that the averageannual staff sickness absencerate does not exceed 11 daysper (full-time equivalent)member of staff

Invoice paymentTo ensure 97% of invoices arepaid within 30 days of receipt

Not met: The average rate ofsick absence was 11.1 days per(full-time equivalent) member ofstaff, however sick absence hashad a downward trend over thepast ten years

Exceeded: The total surplus,after FCO costs of £40.7 million,was £29.1 million

Exceeded: An average unit costof £22.86 was achieved

Exceeded: The averagenumber of invoices paid within30 days was 99%

Passport unit cost

0

5

10

15

20

25

30

1998–99 1999–2000 2000–01 2001–02 2002–03 2003–04

Pou

nds

Actual

Target

0

5

10

15

20

25

30

35

40

45

2000–01 2001–02 2002–03 2003–04

Actual

Target

Surplus after FCO costs

Mill

ion

poun

ds

Staff sickness absence

0

2

4

6

8

10

12

14

16

95

96

97

98

99

99

–0

0

00

–0

1

01

–0

2

02

–0

3

03

–0

4

Day

s pe

r an

num

Actual

Target

84%

86%

88%

90%

92%

94%

96%

98%

100%

1998–99 1999–2000 2000–01 2001–02 2002–03 2003–04

Actual

Target

Invoice payment within 30 days

Staff satisfactionTo ensure a staff satisfaction ratewith working for the UKPS of 90%

CONTACT:

If you wish to receive further information on any of the issues in this document or have any questions relating to the services

provided by the UK Passport Service, please contact:

Marketing and Communications Directorate

UK Passport Service

Globe House

89 Eccleston Square

London SW1V 1PN

Or via the Passport Service website: www.passport.gov.uk

You can also contact the Passport Adviceline (24 hours a day, 7 days a week)

0870 521 0410

(Calls are charged at national rate)

All media enquiries should be directed to the Home Office Press Office:

020 7273 4545

9 780102 928297

ISBN 0-10-292829-0








UK PASSPORT SERVICE


2003–2004

UK

PAS

SP

OR

T SER

VICE

Annual Report and Accounts 2

00

3–

20

04

REGIONAL OFFICES

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Durham

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