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Lords amendment: No. 1, page 1, line 3, at beginning insert
The Parliamentary Under-Secretary of State for the Home Department (Andy Burnham):
I beg to move, That the House disagrees with the Lords in the said amendment.
Mr. Speaker: With this we may discuss Lords amendments Nos. 68 to 70, Government motions to disagree thereto and amendment (a) in lieu thereof.
Andy Burnham: I should say at the beginning that the Government support amendment (a), tabled by my right hon. Friend the Member for Holborn and St. Pancras (Frank Dobson) and, should the need arise, the Government will move it.
The amendments cover the requirement for openness in relation to the costs of the identity card scheme. That is a legitimate request, with which I shall deal head on. It is of course desirable that as much information as possible about the scheme is placed in the public domain. However, it is true to say that that aim has to be balanced by the need to secure best value in an open procurement process and to adhere to the guidelines for such Government procurement.
We have two legitimate aims, therefore, that pull in opposite directions. We have to seek to resolve that tension and strike a balance. We believe that my right hon. Friend's amendment does just that, with subsection (4) being the crucial element. By contrast, the alternative amendment passed by the other place is heavy-handed and prescriptive and would not allow us to achieve best value in the procurement process. It would of course also be something of a precedent to accept that amendment and we will resist it.
We have made available a full account of the costs of the identity card scheme and we are pleased this evening to account again for the costs and explain them in some detail. We touched on the issue earlier in the debate, and we heard some inaccurate and misleading comment designed to undermine public confidence in the scheme. Some even claimed that a card would cost as much as £300. I would not pay £300 for an identity card, and nor would I expect my constituents to do so. Those costs, I am pleased to say, are completely wrong.
Mr. Wallace:
Does the Minister agree that his comments would carry much more weight if No. 10 Downing street had not published the somewhat
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fatuous report on the £1.7 billion cost of identity fraud that was pulled apart by experts on both sides of the argument?
Andy Burnham: The hon. Gentleman should be cautious about rubbishing the figures that were placed in the public domain, not by No. 10 Downing street but by the identity fraud steering committee, which works under the auspices of the Home Office but brings together a range of partners from the public and private sectors and is engaged in a serious attempt to tackle a real threat. I am sure that the figure placed in the public domain underestimates the true cost of identity fraud. The hon. Gentleman is wrong to suggest that it was a cynical exercise. The group has been meeting for some time and its methodology and the breakdown of its figures were placed in the Library. I urge the hon. Gentleman to look at the detail if he has not done so already.
Mr. Hollobone: Does the Minister recognise the public's concern that the costs of the scheme might be better spent on more police officers on the beat and tighter border controls? There is natural suspicion that the costs of any Government procurement scheme, especially one involving IT, are likely to exceed the amount stated, not fall below it.
Andy Burnham: I have two points to make in response. First, it is not a case of either/or. The hon. Gentleman will know—the point has been made many times—that this Government have invested significantly in police on the beat and we are proud to have done so. His main point—and a mistake made by the Opposition throughout the debate—is the suggestion that a pot of funds is sitting in the Home Office to pay for the entire scheme and that it can easily be directed to another Home Office priority. The whole premise is that the basis of funding the scheme will be the same as for passports: the costs of running the passport service are predominantly recovered from the fees people pay for their passport. That principle will continue when we introduce a biometric ID card system.
7.30 pm
Mr. Garnier: May I draw Members' attention to the Minister's letter of 7 February, which was sent only to Labour Members? In attacking the London School of Economics' report on the costs of the project, he said:
"The LSE also allocated an inflated £1 billion marketing budget and assumed a much higher loss/theft rate than is the case for existing documents."
Was not the Minister aware when he wrote the letter that the Government had received a denial of that point on 5 August 2005 when the LSE responded to the Government response to the LSE report? Surely he was aware that the LSE status report issued in January 2006 stated that it had made no such estimate. Would he care to correct that erroneous allegation, which continues the line of ad hominem attacks that he and his colleagues have made on Simon Davies and his colleagues?
Andy Burnham: It is entirely legitimate for the Government to point out what we believe were flaws in the LSE report—
Andy Burnham:
I am answering the hon. and learned Gentleman's point, so perhaps he could give me a moment to do so.
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I am pleased that the hon. and learned Gentleman has attached himself to the parliamentary Labour party mailing list—I do not know what his intentions are. He will see from my letter that, based on our scheme, the main cost driver assumed by the LSE is incorrect. The LSE assumed a five-year refresh rate for biometric enrolment, but there is no evidence to support that as the main assumption for the scheme—the major basis on which we have challenged the LSE figures, because they would add enormous costs to the scheme.
I do not want the debate to go over the ground of the LSE report. I will answer some of the points raised in it later.
Mr. Garnier: Can we get a straight admission from the Minister that the allegation in his letter, that the LSE allocated an inflated £1 billion marketing budget, is wrong? If that is true, where does it appear in any of the LSE documents? There is no point in the Minister trying to avoid the point: is it true or not? He has been told by the LSE that it is not true, so why does not he tell the House what he thinks?
Andy Burnham: I do not intend to debate the detail of the LSE report. If I need to correct anything, I shall write to the hon. and learned Gentleman, but I can say with confidence that the LSE figures have moved around somewhat. In a discussion with me in the House, one of the authors of the report said publicly that they would have to "revise downwards" some of the figures. It has been quite hard to keep track of the some of the LSE figures, but I do not want the debate to be purely about that point.
Martin Linton: Will my hon. Friend give way?
Andy Burnham: I want to make some progress.
My two key points are, first, that the costs of the scheme are both realistic and affordable for the Government and the individual citizen and, secondly, that it is worth making the investment now because Britain does not have a high-standard, comprehensive system of identification. We have published the expected costs of issuing ID cards, and the current best estimate of the annual average running costs of issuing ID cards and passports to British citizens is £584 million, from the start of the ID scheme, including the cost of compiling and running the national identity register.
Mr. David Drew (Stroud) (Lab/Co-op): I am pleased that the figure has been made public, but does my hon. Friend accept that some of us still have concerns about the cost? The biggest problem is the cost of the IT infrastructure. We do not want another Rural Payments Agency problem, where the IT was renegotiated as the scheme was being introduced, so it would be helpful if the Government said that, rather than hiding behind commercial confidentiality, they are prepared to share such information with the House so that we can be sure that the IT consultants do not run off and make a bomb out of the proposal. Does my hon. Friend agree?
Andy Burnham:
It is precisely because we do not want people running off and making a bomb at the expense of the taxpayer that we are proceeding as we are. As I said earlier, we recognise the tension between running, and
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getting best value from, a procurement process and the need to be open and accountable by putting as much information as possible in the public domain. Those are two conflicting aims, but in the amendment tabled by my right hon. Friend the Member for Holborn and St. Pancras we begin to see a way to resolve them. I agree with my hon. Friend the Member for Stroud (Mr. Drew) inasmuch as we want to put information into the public domain as early as possible, but without fettering our ability to secure the cost and keep it down when we go to market. A person would not ordinarily say how much they had to spend before trying to obtain the best price from a supplier, and that principle holds good for this exercise.
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