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Passport shortage: Procurement mired in controversy?

Passport shortage: Procurement mired in controversy?

15 Sep 2024 | By Maheesha Mudugamuwa


As Sri Lanka grapples with an acute passport shortage, the Government’s decision to shift production to one Thales DIS Finland Oy in partnership with Just in Time Technologies Ltd. (Thales/JIT) is being scrutinised for alleged hidden costs and operational risks. 

What was initially touted as a cost-saving measure is now mired in controversy and questions have risen whether the move will genuinely benefit the public or if it masks deeper issues within the procurement process.

As of now, the Department of Immigration and Emigration (DIE) has been forced to limit passport issuance to just 1,000 per day, a dramatic reduction from the daily requirement of 2,500, due to a severe shortage of passport books.


Thales’s new offer and Epic’s delivery schedule

In response, the Government hastily sought solutions, presenting two primary options: a proposal from Epic Lanka Ltd. and another from Thales/JIT, which is said to be a joint venture entering the Sri Lankan market for the first time.

Epic Lanka’s offer had included supplying 500,000 passport books within 6-8 weeks, although it could not meet the immediate demand for 100,000 passports. Its proposal features 64-page passports at a cost of $ 5.89 each. 

Conversely, Thales/JIT had proposed delivering 750,000 passports, with the first batch of 50,000 set to arrive by 27 October and the rest between January and April 2025. These passports, containing 48 pages, are reportedly to be priced at $ 4.97 each, with a delivery timeframe ranging from 11 to 38 weeks.

Recent developments reveal a more complex picture than initially presented. The e-MRTD Public Key Infrastructure (PKI) facility, originally slated to be part of the passport procurement process, has now been separated into a distinct procurement. This separation, it is learnt, has delayed the software acquisition by an additional six months, despite the passport procurement already being finalised.

A recent Government analysis, obtained from an authoritative source, has indicated that choosing Epic Lanka’s proposal could incur an additional cost of Rs. 136.77 million. On the other hand, the Thales/JIT proposal, while appearing cheaper on the surface, has raised significant concerns. Thales has no prior experience supplying passport booklets without chips and has not previously worked with Sri Lanka.

An insider close to the procurement process disclosed: “New information highlights significant cost and efficiency differences between the proposals from Epic Lanka and Thales/JIT in Sri Lanka’s passport procurement process. Epic Lanka offers a 64-page passport at $ 5.89, which includes crucial security features such as an Invisible Personal Information (IPI) licence, LetterScreen licence, and a Travel Document Personalisation System (TDPS), along with three full-time engineers on-site. 

“In contrast, Thales/JIT proposes a 48-page passport at $ 4.97, excluding essential services and requiring the purchase of new laminators, adding to the overall cost. Adjusting Thales/JIT’s price to 64 pages raises the cost to $ 6.65 per passport, making Epic’s proposal more cost-effective at $ 0.092 per page compared to Thales/JIT’s $ 0.104 per page. 

“Additionally, switching to Thales/JIT’s passports would require notifying 196+ countries about new designs and security features, delaying issuance by 4-6 weeks.”

Adding to the complexity, Thales has recently updated its delivery schedule. It is learnt that it now plans to ship the first batch of 50,000 Machine-Readable Passport (MRP) booklets by 27 October, with a total of 300,000 MRP booklets expected by the end of this year. 

The remaining 450,000 booklets are slated for delivery between January and April 2025. Thales has also proposed a discount of € 0.10 per e-passport booklet for every MRP booklet shipped, up to a maximum of 750,000 booklets.

In contrast, Epic Lanka has clarified that the earliest availability for the first consignment is 4 October, with the latest being 18 October. The passports would arrive via air freight from Indonesia within 2-3 days. This tight timeline is seen as a significant advantage given the urgent need for passports.


Missing signatures

The Secretary to the Ministry of Public Security has communicated to the Cabinet-appointed committee that Thales has agreed to include its minimum order range of 300,000 to 750,000 booklets in the procurement for five million e-passports. At a rate of $ 4.97 per booklet, this arrangement could potentially save the Government Rs. 16,716,625. In contrast, procuring an additional 500,000 passports from Epic Lanka at $ 5.89 each would result in an extra cost of $ 2,945,000.

The Epic proposal has faced criticism for not providing a definitive delivery date, which has raised concerns about whether it can meet the urgent demand. The Secretary had requested an exact delivery date from Epic, leading to its commitment to deliver the first consignment by mid-October.

Despite these revelations, the high-level committee initially decided to proceed with Epic Lanka’s proposal, exploring further discounts and diplomatic channels to expedite the printing process. This decision, signed by key committee members including Secretary to the President E.M.S.B. Ekanayake and Secretary to the Prime Minister Anura Dissanayake, had not had the signature of Public Security Ministry Secretary P.V. Gunathilaka.

An insider commented: “The lack of Gunathilaka’s signature raises questions about the decision’s validity and whether there are unresolved issues within the committee.”

As the Government weighs its options, the decision between Epic Lanka’s more immediate but costly solution and Thales/JIT’s longer-term plan with financial incentives remains fraught with complexity. The final choice will have significant implications for both the immediate resolution of the passport crisis and long-term financial impact.

The procurement saga underscores the challenges of balancing urgent public needs with financial constraints and operational uncertainties. The Government’s next steps will be crucial in resolving the crisis effectively while ensuring transparency and accountability in the decision-making process. 


Government response

Meanwhile, when contacted by The Sunday Morning, Public Security Minister Tiran Alles provided clarity on several aspects of the ongoing passport procurement process.

He explained that the current 64-page passport booklets included several pages that may no longer be necessary, with additional pages primarily used for visa stamps and exchanges. 

“The current format includes pages that are just from the past. Now there are pages for stamps and exchanges, which are no longer needed. There are some narrations on certain pages that are not relevant,” Alles said.

Regarding lamination, Alles noted that the existing laminating machines at the Department of Immigration and Emigration were adequate for current passport requirements. However, with the new thin-page passports, a more advanced lamination process is being introduced to prevent forgery.

“The laminating machines we have are used for the current passports. The new lamination will address issues where previously, people could remove and replace photographs. The new thin pages make such tampering impossible,” the Minister explained.

Alles also addressed the procurement process, emphasising that the technology for laminating and PKI for e-passports were being procured separately to avoid delays. “The PKI technology for e-passports is a separate tender. The lamination technology is also a separate procurement, so nothing is affecting the passport procurement process,” Alles stated.

Finally, the Minister noted that the delivery of the new passports would not be delayed despite the introduction of additional chip technology. “As soon as the passports are available, we will deliver them. The passport design remains the same; the addition of a chip is just an enhancement,” he concluded.

The Sunday Morning yesterday (14) reached out via email to Thales DIS Finland Oy and Just in Time Technologies with several questions regarding their proposal for supplying passport booklets to Sri Lanka. However, the company had not provided the necessary information by the time the newspaper went to print.

The newspaper’s inquiries sought clarification on a range of issues, including the suppliers’ experience with chipless passport booklets, the cost breakdown of their offer, and their ability to meet the revised delivery schedule. 

Additionally, The Sunday Morning requested details on the security features of their proposed 48-page passports and how these compared to competitors’ offerings. The newspaper also sought information on the terms of their proposed discount, potential operational challenges, and their response to concerns about the procurement process. 



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