The government has, for the first time, admitted
publicly thatit cannot quantify in financial terms the expected
benefitsfrom its controversial
£5.4bnNational
Identity Scheme (NIS).
James Hall, chief executive of the Identity & Passport
Service, said, "Many of these benefits [of the NIS] may be hard to
quantify and potentially harder to articulate in financial terms
within the scheme's business case."
Hall's statement comes in the same month the IPS is due to
announce
initial contracts for the scheme's framework procurement
programme. The IPS estimated the technology costs to be 16% of
total costs, about £758m. It said business and programme management
costs would be 18% of costs (£853m), while the bulk of costs, 40%
or £1.9bn, will go to "product manufacture and secure
delivery".
Hall's statement was in response to an
annual report from the scheme's external watchdog, the
Independent Scheme Assurance Panel (ISAP), published this week.
Hall went on to say, "The objectives and approach set out in our
strategy will continue to lead the scheme towards delivery of a
broad-based robust set of benefits." Among the first to benefit
would be job-seekers and employers who would find pre-employment
checks easier, and young people, because the NIS would make it
easier to get started in independent life, he said.
An
updated assessment of the costs of the scheme published this
week by the IPS reported an expected drop in the 10-year costs of
registering UK and Northern Ireland nationals from £5.43bn to
£4.74bn. However, the cost of supplying foreign nationals with ID
cards would rise to £311m, bringing total costs to more than
£5bn.
But anti-ID card lobbyist Phil
Booth said the drop is attributable to "creative accounting in
order to match the announcement by (Home Secretary) Jacqui Smith on
6 March".
The IPS said the savings will accrue from rolling out the bulk
of ID cards later in the project life-cycle, from a cheaper
redevelopment of the existing passport application system, and from
getting the private sector to collect fingerprint and facial images
of card holders for the IPS. But it also said that holding back the
bulk roll-out to 2012 would raise costs overall.
Computer Weekly has maintained from the scheme's inception that
the government has not made a convincing business case. It called
then for the government to publish its Gateway Reviews that
assessed the scheme's viability. The government
fought in court to keep these details secret, even in the face
of recommendations by the Information Tribunal to publish them.
Toby Stevens, chief executive of the
Enterprise Privacy Group
(EPG), said the country had waited five years to see if the NIS
would contribute to meeting public and private sector ID management
needs. "If the government were to shelve or abandon it now, a host
of competing initiatives would rush in. [Government] therefore
[has] little choice but to proceed with the programme in one form
or another, although there's plenty of scope to modify how they
deliver it," Stevens said.
An IPS spokesperson said, "The Identity and Passport Service has
made a robust business case for the National Identity Scheme and we
remain committed to
its delivery as outlined by the home secretary in March.
"The business case for the scheme has been produced in
accordance with HM Treasury guidelines and includes assessment all
of the relevant costs and benefits of the scheme.
"This business case has been subject to thorough review within
the Home Office and by HM Treasury. It includes financial
quantification of many of the currently dentified benefits of the
scheme.
"It is clear that in addition to the currently quantified
benefits there are many benefits that have been identified but have
not been quantified. This is, in part, because some benefits are
not easily quantified. For example increased identity assurance
making terrorist acts harder to perpetrate is a benefit of
introducing the NIS however it is not easy to put a value on the
benefit to the UK economy."
Stevens at the EPG said, "The early justifications for the ID
cards scheme were driven by state-level needs such as preventing
terrorism, stopping illegal working and reducing fraud.
Unfortunately, it is very difficult to prove a business case in
financial terms, and to their credit IPS are admitting this rather
than trying to push unproven figures on us."
Stevens said HM Treasury has made it clear that the scheme must
be revenue-neutral in its delivery.
"
James Crosby's report provides hope for such a justification,
so long as the government is open to incorporating commercial needs
in the scheme: delivery of clear commercial benefits for
authentication, verification and entitlement services will create a
charging mechanism for IPS to recover its costs, and even to reduce
the delivery costs in the first place," he said.
Stevens said if the government were to shelve or abandon the
scheme now, a host of competing initiatives would rush in to fill
that space created by the past five years of waiting to see if the
NIS would contribute to meeting public and private sector ID
management needs.