The UK government plans to design, build, and run its new digital identity scheme using internal teams rather than outsourcing to contractors, according to new ministerial statements. The move comes as officials continue to dodge questions about the scheme's cost, while promising smartphone-free access and robust verification methods that could potentially be used for social media age-gating.
The UK government has confirmed it will develop its planned digital identity scheme using in-house teams rather than outsourcing to external technology companies, marking a significant shift in approach from previous identity initiatives. Digital identity minister Josh Simons made the announcement in response to parliamentary questions, while continuing to provide minimal information about the scheme's cost.
In-House Development Confirmed
In a written response to Liberal Democrat MP Martin Wrigley, who asked about potential involvement from technology companies like Palantir, Simons stated: "We expect the new digital ID to be designed, built and run by in-house government teams, not outsourced to external suppliers." However, the minister did leave room for using "specialist external services or expertise" where needed.
This approach contrasts with the previous Conservative government's identity card scheme, which was abandoned in 2010 after significant controversy and cost overruns. The current Labour government appears determined to avoid similar pitfalls by maintaining control over the technology and data.
Cost Questions Remain Unanswered
Despite the government's commitment to the scheme, officials have consistently refused to provide concrete cost estimates. In response to questions from Conservative MP Sir David Davis, most ministers gave identical responses stating that costs would be met "within the existing spending review settlements," with no final decisions until after consultation.
Home Office minister Mike Tapp offered a slightly different perspective, noting that the Cabinet Office is working with other departments on policy and design decisions: "Whilst this activity is underway, it is not currently possible to finalise cost estimations and the impact these will have on the Home Office's budget."
The government has already rejected a £1.8 billion estimate from the independent Office for Budget Responsibility (OBR) made in November 2025. Department for Science, Innovation and Technology permanent secretary Emran Mian told a Commons select committee that the final cost would depend on consultation outcomes.
Verification and Accessibility Features
The government has provided some technical details about how the digital identity will function. Simons explained that "any checking of such IDs will be done via a robust digital process," specifically noting that "we do not think people should be able to 'flash' their digital ID on their phone screen."
This approach aligns with the Government Digital Service's plans to add programmatic verification to digital versions of the veterans' ID card, suggesting the system will use secure API-based checks rather than simple visual confirmation.
Accessibility remains a key concern. The government has committed to making the system work for those without smartphones, elderly citizens, and people with low digital confidence. Simons mentioned a "major government digital inclusion drive" and did not rule out issuing physical documents to some users.
Potential Social Media Applications
The digital identity scheme could have significant implications for online age verification. When asked by Conservative MP Mike Wood whether the system might be required to sign into social media accounts, Simons neither confirmed nor denied the possibility.
This question has gained urgency following the House of Lords vote that appears to support banning under-16s from social media platforms. If implemented, the government's digital identity could become the primary tool for age verification, raising questions about privacy and data protection.
Regulatory Context and Privacy Concerns
The digital ID scheme exists within a complex regulatory landscape. Under GDPR, any processing of personal data for identity verification must meet strict requirements for lawfulness, transparency, and data minimization. The scheme's design will need to demonstrate compliance with these principles, particularly if it becomes mandatory for accessing services.
The government's insistence that this is "not an ID card" appears to be an attempt to distance the scheme from the controversial identity card proposal that was rejected in 2010. However, critics argue that any government-maintained digital identity system that can be used to verify eligibility for work or access services functions similarly to a digital ID card.
What Happens Next
The government plans to launch a formal consultation on the digital identity scheme in February 2026. This will provide the first opportunity for detailed public input on the system's design, cost, and implementation timeline.
The scheme's development will likely face scrutiny from data protection authorities, civil liberties organizations, and technology experts. Key questions that will need addressing include:
- How will the system ensure data security and prevent breaches?
- What safeguards will protect against function creep (expanding the system's use beyond original purposes)?
- How will the government ensure the system is accessible to all citizens, regardless of digital literacy or smartphone access?
- What role will private companies play in providing "specialist services"?
Broader Implications
The UK's approach to digital identity development reflects a growing trend among governments to create centralized digital identity systems. Similar initiatives exist in other countries, including Estonia's digital ID system, India's Aadhaar, and the European Union's digital identity wallet framework.
However, the UK's history with identity cards makes this particularly sensitive. The previous scheme was abandoned after widespread opposition over cost, civil liberties concerns, and questions about necessity. The government's current insistence on in-house development and smartphone-free access suggests it has learned from past mistakes, but the fundamental questions about cost, necessity, and privacy remain.
As the consultation process begins, the government will need to provide much more detailed information about the system's architecture, data protection measures, and long-term costs. The success of the scheme will depend not just on technical implementation, but on building public trust in a system that touches on fundamental questions of identity, privacy, and government power in the digital age.
The digital identity scheme represents one of the most significant technology initiatives the UK government has undertaken. Its development will be closely watched by other nations considering similar systems, and its implementation will have lasting implications for how citizens interact with government services and prove their identity in an increasingly digital world.
UK Government Digital Service GDPR Text UK Digital Identity Consultation (when available)
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