The 10 councils on the Microsoft Shared Learning Group want to find a way of reusing existing proofs of identity, such as passports and driving licences, so that they can phase out user names and passwords.
Derby City Council will lead the project when it kicks off in the new year. It will begin by working with the Department for Work and Pensions on electronic authentication for people claiming benefits that are administered jointly by councils and the DWP.
The other participating councils are Kent, Isle of Man, Rotherham, Sunderland, Wakefield, Warwick, Bromley, Lewisham and Newham.
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