Original URL: http://www.theregister.co.uk/2011/02/16/id_card_compo/

Gov will pay £2.25m compo to ID card suppliers

Money down drain says Blunkett ... who should know

By Joe Fay

Posted in Government, 16th February 2011 11:43 GMT

The cost of compensating suppliers after the scrapping of the ID card scheme is likely to hit £2.25m, Home Office Damian Green has confirmed.

Green disclosed the figure in a letter to former Labour Home Secretary and erstwhile ID card enthusiast David Blunkett, the Daily Telegraph reports.

On top of the payments of £2.25m to suppliers who saw the whole ID edifice come crashing down, scrapping the system themselves cost another £400,000 Green told Blunkett. It's not clear whether that includes the cost of last week's photo op, which saw Green feeding the ID register hard drives into a shredder.

Thales gets the largest share of compo, more than £2m. Oh, and it also gets the £400,000 for scrapping the data.

Blunkett raged about the cost of scrapping the system, telling the Telegraph, "Millions of pounds have been poured down the drain, not to mention the removal of a benefit freely chosen by thousands of people to help protect their identity."

Blunkett argued there was no need to destroy the data, as it could have been integrated into biometric passports "which, in years to come, will doubtless become mandatory for international travel".

While the £2.65m figure disclosed by Green sounds like a lot, it ignores the cost of asset write-offs. In a Commons answer last month, Green said the costs of scrapping the system would be £5m in the current financial year, which will be balanced by savings of £86m over the next four years.

This is of course is just a blip compared to the £330m Labour lavished on the abortive scheme. Just developing the "policy, legislation and business case" attracted a £41m price tag. ®