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LSE clarifies ID Card cost claims

Huge variants in estimates for scheme fuel spats

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The London School of Economics (LSE) has issued a statement clarifying its position on its National ID card research. The announcement follows press reports that project costs could go as high as £40bn. The LSE says that its original estimate of a £19.2bn high watermark stands and no other figure should be attributed to them.

The original figure, published in its June report, The Identity Project: An assessment of the UK Identity Cards Bill and its implications, was more than triple the government's £5.8bn estimate, a number qualified by a report from international consultancy firm KPMG, which concluded the Outline Business Case for the scheme was "robust and appropriate". The government has recently published extracts from this report in response to the LSE estimate. The cost of a stand-alone ID card was put at £30 and £93 for a passport and ID card package.

Recent press reports have suggested that the cost of the compulsory document may reach as high as £300.

The LSE believes that, the true cost to the taxpayer may be higher than the Home Office estimate, because the figure encompassed "design costs." Factors such as implementation or interaction and integration with other public sector bodies were not taken into account. The School is unwilling to put any further figures out at this point and draws attention to the fact some costs may even go down given the Government's huge existing investment to upgrade its IT infrastructure over the next decade.

Professor Ian Angell of LSE's Information Systems department has written to Andy Burnham the Home Office minister responsible for rolling out the ID card scheme seeking a detailed response on integration and cost points so it can update its research.

The June report was the result of a six-month study guided by a steering group of 14 professors and involving extensive consultations with nearly 100 industry representatives, experts and researchers from the UK and around the world.

In its conclusion, Patrick Dunleavy, Professor of Political Science and Public Policy, said, "The Home Office... has not yet justified its [£6bn] estimate in detail. By contrast, we recognize considerable uncertainties ahead with such a novel, high tech scheme and we show how these uncertainties might affect costings."

The three-way spat between the LSE, the government and the media comes in light of reports that Tony Blair is facing a fresh rebellion from the House of Lords. Rebel peer are unhappy about the uncertain cost of the cards to taxpayers and seem set to win amendments requiring a vote in both houses before the scheme is made compulsory.

The figure of £40bn has been dismissed as 'nonsensical' by the Home Office.

Related link

LSE Report: The Identity Project: An assessment of the UK Identity Cards Bill and its implications (PDF: 2.48MB)

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