There is no basis in reality for believing it actually costs the government £60 to process a renewal. Even when challenged with an FOI request the government can't produce a breakdown of costs to defend their pricing, all they are doing is updating the photo!
The reality is there are costs such as three thousand or so staff, premises etc. which are divided up and reflected in the cost of a passport.
This is all besides the point though, it should be included in citizenship regardless of costs as we pay tax for this, a lifelong valid passport issued at birth with simple photo updates required every 10 years or so.
It's very much on the point of my replying to your earlier statement.
The several hundred million a year cost of running HM Passport Office has to come from somewhere. If it's just taken out of general taxation then something else has to give or general taxation has to go up a little bit for everyone.