ID Cards to cost £5.4bn

Home Office guesstimate

The Home Office has announced how much it thinks ID cards are going to cost us - a mere £5.4bn.

This is a snip compared to what some independent observers reckon the program will cost. Last year The London School of Economics (LSE) put a price tag of upto £19.2bn on the ID card scheme.

The Home Office reckongs it will cost £290m to set-up passport and ID cards for British and Irish citizens resident in the UK for October 2006 to October 2016 and operational costs will be £5.1bn.

That figure, you'll be glad to hear, includes: "provision for optimism bias". "Optimism bias is a percentage uplift added to key cost parameters. It is based on the tendency for appraisers to be over-optimistic in the forecast of capital costs, works duration, operating costs and benefits delivery."

Biometric cards will be introduced for foreign nationals in 2008 and will then roll out to all UK nationals.

On the technology the report says: "A review of the technical development options. This has identified opportunities to use existing assets and resources available across Government which might reduce delivery and cost risks e.g. in the development of database solutions to implement the National Identity Register."

The Home Office is acquiring and fitting out 69 offices around the country ahead of the introduction of interviews for first time passport applicants.

Of course it would be unfair to point out the difference between previous government estimates of the costs of IT projects and the reality is enormous. That is presumably why section 37 of the Act requires the government to release an estimate of likely costs every six months.

The statement includes the usual toot such as: "the Scheme has the potential to make the work of police in detecting crime a lot easier. Detection rates could increase as a direct result,". The report claims ID cards will save the country between £1bn and £1.7bn a year.

The release should be on the Home Office website shortly.

The report claims ID cards will provide between £1bn and £1.7bn in economic benefits to the UK. Identity fraud currently costs the country £1.7bn a year.®

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