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UK.gov ID card costings fit on back of (small) envelope

Mathematics of the madhouse

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Analysis Earlier this year the home secretary condemned research from the LSE and Kable which costed his proposed ID card proposals at three times the government’s preferred numbers.

Charles Clarke described the figures as "mad" and naturally backed the Government's "best estimate" of £93 per ID Card. It follows that the £93 figure must be a robust one and not one which could be the result of a trivial calculation that many 14 year old school pupils could perform.

Unfortunately, as we explain below, it is possible to perform one such calculation to get within 0.5 per cent of the Government's "best estimate".

The starting position of the calculation is the information provided by the Government in its response to the LSE paper and the Passport Agency's published business plan. The Home Office response to the LSE research states that the Passport Agency would issue ID Cards, and that this would involve additional costs (eg "extending the scheme beyond the 80 per cent of those aged 16 plus who have passports"; "recording biometric information"; "providing online verification service", and "materials associated with the manufacture of the cards").

The published "corporate and business" five year plan (2005-2010) for the Passport Agency shows that it is supposed to be self financing (eg the costs of running the Passport Agency are to be recovered by revenues such as passport fees). The official Passport Agency plan predicts £4bn of income in the decade starting 2006 so, if we assume that the Passport Agency achieves financial balance, it follows that the projected costs of the Passport Agency is also £4bn over the next decade.

We also know from Government statements that the ID Card is also supposed to be self financing and that the Passport Agency will issue the ID Card. So it is reasonable to take the £4bn cost of the Passport Agency per 10 years and assume that the passport and ID Card will be wholly integrated. Since the Government state that there are about 20 per cent of the population not having a passport, it is possible to scale up the costs of Passport Agency costs for the 10 years by 20 per cent. This gives you a figure of £4.8bn over the next decade.

However, the additional costs of ID Cards (eg providing a verification service etc) can be estimated to be about 30 per cent more than biometric passport (this can be deduced from the fact that the Government compare a sum around £70-£75 for the passport as against £93 for the ID Card).

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