UK government scraps digital ID scheme as Burnham shifts spending to cost-of-living relief

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UK scraps digital ID for relief

Highlights

Burnham will scrap the UK Labour government’s digital ID scheme, redirecting the £600mn per year cost to cost-of-living relief and immediate priorities.
The digital ID would have been mandatory only for right-to-work checks, but digital compliance for employers—including gig and zero-hours workers—will still advance under Labour’s new immigration bill.
The policy reversal aligns the government with critics including Conservatives and civil liberties groups, reflecting prior Labour failures after £4.6bn was wasted on a similar scheme in 2010.

Policy reset before Burnham takes office

As first reported by Financial Times, Burnham says on Saturday that he will abandon the Labour government’s digital ID scheme as part of a broader reset focused on everyday concerns rather than costly centralised programmes.

His spokesperson says the incoming prime minister wants government spending to go toward “improving everyday life” and helping people with immediate pressures. The Office for Budget Responsibility had estimated the scheme would cost £600mn a year, and the government says those resources will instead be directed to areas such as support with the cost of living.

The decision reverses a policy approved by Sir Keir Starmer last September in a push to combat illegal migration. Ministers later tried to present digital IDs as a tool to reform public services including welfare payments, childcare entitlements and local government, after public opposition forced them to drop plans to require workers more broadly to sign up.

Under the revised model, the ID was only to be mandatory for right-to-work checks and not for access to public services. Burnham’s office says the government still intends to crack down on illegal working, with mandatory digital right-to-work checks for employers continuing and set to extend to gig economy and zero-hours workers through Labour’s border security, asylum and immigration bill.

Political fallout and wider implications

The move is likely to disappoint supporters of the scheme including Labour Together and the Tony Blair Institute, while aligning more closely with critics such as the Conservatives, the Liberal Democrats and civil liberties groups including Big Brother Watch and Liberty.

The issue also carries historical sensitivity for Labour. A Labour government two decades ago tried to introduce an ID system, but the programme was scrapped after the Tory-Lib Dem administration took power in 2010, with an estimated £4.6bn wasted on the failed effort.

Burnham’s position reflects that history directly. He was the junior Home Office minister responsible for implementing the Identity Cards Act 2006, and he signalled his doubts last autumn when he told the Labour conference he was “not yet” in support of new digital IDs, warning that the policy could absorb substantial time and resources without being delivered.

Our earlier report on Andy Burnham’s plan to scrap the Labour government’s digital ID programme explained that the move would redirect an estimated £600 million a year toward cost-of-living support, after widespread public and cross-party opposition. We also noted that mandatory digital right-to-work checks would remain in place and be expanded to cover gig economy and zero-hours workers under Labour’s border security, asylum and immigration bill.

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