UK digital ID scheme cash will come from existing funds

Hiring a permanent government chief digital officer (CDO) is deemed unnecessary to modernise the UK government, the Science, Innovation and Technology Committee has heard.

As part of the committee’s inquiry into the new digital centre of government at the heart of the Department for Science, Innovation and Technology (DSIT), MPs questioned government officials on plans for digital ID, leadership and funding.

In January 2025, the government announced that DSIT would become the digital centre of government, expanding its remit and uniting digital transformation efforts under one command, bringing together experts in data, digital and artificial intelligence (AI) from the Government Digital Service (GDS), the Central Digital and Data Office (CDDO) and the Incubator for AI (iAI).

However, the government has been without a permanent CDO since the departure of Mike Potter in September 2024.

In the committee hearing, DSIT’s minister for digital government and data, Ian Murray, was asked when a permanent CDO would be appointed, to which he replied: “There will not be one.”

According to Murray, the decision was made that it would be better for the department to take the lead than to have a CDO.

“I think the decision was just taken that we were not planning to have a new CDO, the purposes of which were that the transformation of the department and modernising government did not require us to have that,” he said.

“The GDS and DSIT are doing the work through the permanent secretary, and the permanent secretary is taking the lead on that.”

Murray added that “keeping these issues at permanent secretary level is the way to get a cross-government approach” to digital transformation.

One of these cross-government approaches is the introduction of the UK digital identity scheme, announced by prime minister Keir Starmer.

The scheme, which the government hopes will help crack down on illegal migration, will be compulsory for Right to Work checks by the end of the current Parliamentary term, and will include name, date of birth, nationality and residency status information, as well as a photo.

The government will shortly launch a consultation on how the ID service will be delivered.

However, the committee questioned how the scheme will be funded, with less than a week until the Budget.

Murray said some funding would come from other departments.

“Money from other departments will have to come in for the use cases, in terms of each of these other government departments. If you think about the efficiencies that are on the back of this, it is not just down to cost. The use cases also provide huge efficiencies, which feed into government spending as well,” he said.

When pressed by committee member Kit Malthouse, who asked if it would specifically come from “within existing funds”, Murray answered yes, but said that would not necessarily equate to cuts elsewhere.

“The costs of the entire system will depend on what the system looks like and what the capability of the system is outwith the consultation, as well as digital inclusion and all the bits that are attached to digital ID,” he said.

Pressed further by Malthouse, who asked whether the prime minister had announced a completely uncosted policy, Murray said it would depend on what was being built, the onboarding of people and ongoing maintenance.

“Those three buckets of costs will be determined by what kind of system it is you want to build and deliver, and then on top of all that, there is a wraparound,” he said.

“The budget for this, as has already been outlined, will come from DSIT’s current spending review budget and the overall government spending review budget.”

He added that the funding and costs will only be determined once the consultation is complete, as costs “can only really be measured after the consultation has closed and been analysed, and we determine which kind of system we will build”.

The consultation for the digital ID scheme will open in January 2026.