Siemens has won an increase in its fees from the disastrous Passport Agency contract.
This is despite government assurances that the German supplier has been penalised for its part in the ongoing Passport Agency fiasco.
Siemens has also won an increase in the amount it will be paid per passport processed, although a Home office spokeswoman did not say how much this would be.
The rise was justified, she said, because the contract had specified that the level of payment would be established after the system had been trialled, when it was possible to more accurately assess the cost of processing applications.
The spokeswoman confirmed that to date Siemens has only paid £66,951 in "service credits" as a penalty for its failure to deliver both the passports system on time and specific criteria built into the £120 million contract.
Home secretary Jack Straw declared this month that Siemens would be fined for shortcomings in its computer system. These are being blamed for a backlog of almost half a million uncleared passport applications.
Siemens is adamant that it is not responsible for the crisis, which it claims is the result of excessive demand for passports this year. New legislation requires children under 16 to have their own passports, instead of being able to travel on a parent's passports.
Siemens also argues that extra security checks required by the Passport Agency have contributed to the delays.
Siemens argues that the contract is a highly complex project, and that the Passport Agency acknowledged the systems it has implemented have delivered the required functionality.
Privately, Siemens is believed to be arguing that the targets set by the Passport Agency were unachievable.
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