UK digital ID will cost £1.8bn

OBR flags lack of identified savings

The multibillion-pound price of the proposed ‘BritCard’ national digital identity scheme has been revealed by the Office of Budget Responsibility to be £1.8bn over three years.

The reveal from the Office for Budget Responsibility (OBR) comes just days after the minister responsible declined to disclose any figures to Parliament.

The OBR has now costed the ‘BritCard’ programme at £1.8 billion over three years, with no identified savings to offset the impact on public finances.

Last week, Minister for the Cabinet Office Ian Murray defended the government's refusal to publish cost estimates, insisting the financial outlook could only be determined once public consultation on the design of the system had concluded.

"The cost would be determined by what the system looks like, and that can only really be measured after the consultation has been closed and analysed," he told MPs.

However, the OBR's newly released Economic and Fiscal Outlook has filled in the gap.

The watchdog noted that the government's summer Spending Review saw departmental budgets revised upward "by an average of around £6 billion per year" between 2026/27 and 2029/30 to reflect financial pressures.

According to the OBR, the digital ID initiative carries an "unfunded cost" of £600 million per year, a sum that departments will have to absorb within existing departmental expenditure limits (DEL). The scheme's provisional three-year price tag includes £1.3 billion in capital investment (CDEL) and £500 million in resource spending (RDEL).

"The Government has announced its intention to meet the costs of this through existing DEL budgets," the OBR wrote, "however no specific savings have yet been identified."

The digital identity programme – widely nicknamed ‘BritCard’ – was unveiled in September by Prime Minister Keir Starmer. The system would create digital identification for all "UK citizens and legal residents," with the stated aims of tackling illegal working, improving verification of immigration status, and simplifying access to public services.

The smartphone-based system would sit alongside the digital driving licence initiative previously announced by ministers.

Citizens would use the BritCard to prove their right to live and work in the UK, and to access services such as childcare support, tax records, welfare payments, and driving licence applications.

Ministers argue the scheme will deter irregular migration by making it harder for those without the right to work to find employment.

"This will stop people without the right to work in the UK from working, reducing the attraction of illegally migrating to the UK or working illegally on a visa that does not allow it," the government claims.

But funding the system has already sparked debate in Westminster.

Conservative MP Kit Malthouse, a member of the House of Commons Science, Innovation and Technology Committee, warned at a recent evidence session that the project could be squeezed out by competing departmental needs.

"We may be in a position then where the home secretary says, 'Right, you're asking for £500 million for this thing that may yield savings. But you know what? That's £500 million I'd have to take from policing or border security, so I don't want your service. Thanks very much. Go and look elsewhere,'" he said.

"The delivery of it will be down effectively to negotiation with departments."

Murray insisted the project would not be sidelined, calling the digital ID scheme "the prime ministerial priority."

He said the Government Digital Service (GDS) would lead the system's development under the oversight of the Cabinet Office, regardless of funding tensions.