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Identity assurance – the control shifts

Posted on: Monday 25th of June 2012

Last week we published our report on the key market of identity assurance. We estimate that it is worth more than £280m in 2011 and will grow to £360m in 2014. One of the key drivers of this growth is the public sector. Driven by a desire that government should be ‘digital by default’, the government is now working on series of projects based on the premise that a citizen-centric identity assurance service could be a far more effective process.

The government aims to save money over the next three years, but instead of re-inventing the wheel, it is seeking identity solutions from the private sector. The first two procurement tenders, from the Department for Work and Pensions and the Post Office, are looking to develop an ecosystem of suppliers. A third, Her Majesty’s Revenue and Customs (HMRC), held its first briefing for bidders last week.

The picture emerging (a fuller note is available from us) from government is confirming the findings of our report – that the vision is there but actually how a citizen-centric identity service will be delivered is not clear. Along with industry it has identified some difficult issues that need resolving, such as whether there should be more than one supplier (yes!), the role of “attorneys” (an agent, friend or relation acting on behalf of an old person), and whether there should be more than one level of assurance.

But it cannot wait too long before implementing new solutions, as the contract for the de facto authentication system, the Government Gateway, is due to expire in 2015. There are hopes for some prototype projects next year and a full scale roll out from 2015 to 2017.

In the long run, this person-centric approach could pose a threat to the industry’s existing business models, which are based largely on fear of fraud and to comply with anti-money laundering rules.

Plans to make it easier for citizens to do business with government and to save the government money have got to be applauded. And, importantly, our analysis reveals that the plans could also stimulate the economy over time, by making it easier for people to transact with business, reducing waste and creating new opportunities.

What is also clear is that government isn’t going it alone. Because these projects will involve the existing suppliers, there’s every opportunity for these suppliers to help shape a growth market for the next five years.