May announces Passport Office review
The Passport Office could be brought under the direct control of the Home Office after delays in the processing of passport applications.
Home Secretary Theresa May told MPs she had ordered a review into whether the service should remain an independent agency.
About 30,000 applications have been caught in a backlog as requests for new passports increased to a 12-year high.
Labour branded the situation a "sorry shambles" and called on Mrs May to apologise to all affected.
Shadow home secretary Yvette Cooper claimed Mrs May had been too distracted by her row with Education Secretary Michael Gove to deal with the issue.
She said Mrs May had denied there was a problem when questioned by MPs on Monday only for the prime minister to confirm days later the number hit by delays.
Labour has blamed the backlog on cuts in staffing at the Identity and Passport Service where the number of employees fell by 600.
But Mrs May said the cuts were a result of scrapping the previous administration's ID card scheme, and added that staff numbers had increased since 2012.
She insisted the government is doing "all it can" to deal with the "surge" in applications but cautioned there is no "big bang solution", as she set out a series of measures to clear the backlog.
People with imminent travel plans will be prioritised for free and British nationals applying from abroad will be able to extend their passports by 12 months, she said.
In addition, parents applying on behalf of their children will be issued with emergency documents.
MPs were also told Passport Office is operating seven days a week and couriers are being used to deliver passports within 24 hours of them being produced, to help fix the problem.
Liberal Democrat MP Julian Huppert welcomed the free upgrade process and sought clarification on how people could apply for this.
Mrs May said people would have to alert the Passport Office of their urgent need to travel and added that information would be published on the Home Office website.
The Passport Office says "99%" of applications are being processed within four weeks.