How passports are funded
Unlike most government departments, Passport Canada does not generally receive appropriations (taxpayers' money) from Parliament. Passport Canada operates on a cost-recovery basis, which means that it funds its daily operations using the fees paid by passport applicants. In other words, passports are not subsidized by all Canadians; only those who apply for a passport actually pay for this service.
Passport Canada does receive special funding from time to time to help pay for important upgrades above and beyond regular operating costs. In 2007–08, for instance, the federal government provided access to $55 million in special funding, which Passport Canada used to buy faster passport printers, put new security measures in place, set up a new central processing facility and upgrade to more secure information technology.
Providing quality service in a cost recovery model
Apart from a small $2 increase to reflect shipping costs in 2005, Canadian passport fees have not changed since 2001. However, the cost of producing passports has continued to climb due to inflation, as well as the increasing cost of rent, information technology, salaries and utilities. Passport Canada must juggle these financial pressures while maintaining quality client service and producing passports that are secure, tamper resistant, respected by other countries and compliant with international standards and best practices.
This challenge will be intensified as Passport Canada prepares to introduce the new ePassport.
|Categories||Consular fee (not kept by Passport Canada)||Security and identity authentication||Production and distribution||Client service points|
Breaking down the passport fee
The current passport fee for adults in Canada is $87, but Passport Canada only receives $62 of this fee. The remaining $25 paid by adult passport applicants is called the consular fee, and it is used to fund consular services for Canadians overseas.
The image beside shows a breakdown of the adult passport fee ($87) for the 2010-2011 fiscal year.
The consular fee is not applied to children's passports, for which the fees are $22 for children under three and $37 for children ages three to fifteen. Children's passport fees are much lower than what it costs to produce them. These costs are therefore subsidized by adult passport fees. In fact, the cost to produce a passport for a child is actually higher than the cost to produce an adult passport, due to the extra verifications required, particularly in cases where parental custody must be examined.
How much do Canadians pay for their passports?
The table below shows how much Canadians pay for a 24-page passport (all funds are in Canadian dollars).
|Region||In Canada||In the US or Bermuda||Abroad|
|Adults (16 or over)||Passport service fee||$62||$72||$75|
|Consular service fee||$25||$25||$25|
|Cost per month (5 years)||$1.45||$1.62||$1.67|
|Children 3 to 15||Passport service fee||$37||$37||$35|
|Consular service fee||$0||$0||$0|
|Cost per month (5 years)||$0.62||$0.62||$0.58|
|Children under 3||Passport service fee||$22||$22||$20|
|Consular service fee||$0||$0||$0|
|Cost per month (3 years)||$0.37||$0.37||$0.33|
Despite many ongoing cost-saving improvements, such as better demand forecasting and launching the passport renewal process, Passport Canada’s production costs exceed our revenues. In 2010-2011, we had a loss of $4.77 per unit.
The table beside shows Passport Canada production costs versus revenues.
|Average unit revenue||$60.17||$60.85|
|Average unit cost||$63.31||$65.62|
|Loss per unit||$3.14||$4.77|
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