Government ID card costings 'robust'

Wednesday, 9 November 2005 12:00 AM

The government's estimate of how much the ID cards scheme would cost are based on "robust and appropriate" methodology, a new report finds.

Research by consultancy firm KPMG - commissioned by the government - was welcomed by the Home Office as a vindication of its claim that the controversial scheme will not leave taxpayers substantially out of pocket.

A report from the London School of Economics earlier this year suggested that a combined passport and ID card package could cost people up to £300 each.

This was seized upon by critics already concerned by the impact the cards would have on privacy. They argued that when ID cards became compulsory, they would put an unacceptable financial burden on British citizens.

However, ministers have insisted that the combined card would cost no more than £93, while home secretary Charles Clarke recently announced a £30 stand-alone card, which would be valid for ten years and could be used as a travel document within the EU.

Today's report - released by the Home Office - finds that the majority of the government's cost assumptions for the ID card scheme are based on appropriate analysis from the public sector and suppliers.

"There has been lots of discussion of the potential costs of identity cards, much of it based on misinformation and misunderstanding," said Home Office minister Andy Burnham.

"This review provides independent confirmation that, while estimates will continue to be refined as new information becomes available, the methodology is fundamentally robust and reliable."

He added that the government believed £30 for a stand-alone card was a "fair price to pay for the identity protection that this system will bring".

However, in a copy of the report obtained by the Financial Times, the KPMG analysis also recommends a revision of estimates about the cards' expected life of ten years.

"Given the inconclusive evidence for the life-span of the cards, we recommend that an increase in damage rates for the cards in the latter stages of the first ten years should be reflected in an outline business case model, or an estimate of cost for a warranty of the card be introduced," it says.

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