Despite the government’s decision to cancel its digital ID plans, issues still remain around legacy systems and how they access public services, according to the National Audit Office (NAO).
A report by the NAO on lessons learned from the government’s digital ID scheme highlighted that while the UK has a strong digital identity foundation in the form of legislation and a thriving industry, it is also plagued with fragmentation and inconsistencies.
Much of this is due to long-standing legacy data and systems issues across departments, and the NAO warned that the problem has not gone away.
The public spending watchdog said the continued inconsistent approaches across government departments remain huge barriers to creating more convenient and secure digital access.
“The current landscape is fragmented and the question is how coherent the overall system should be,” the report said. “A more coordinated approach enables governments to have clearer choices, and a better understanding of the benefits, costs and trade-offs of different delivery models.”
It added that implementing digital identity across an already-fragmented public service is a “complex integration challenge requiring long timescales”.
“Experience suggests that any future initiative involving digital identity would benefit from a clear plan and roadmap,” the report said.
“Without these, there is a risk that disconnected solutions develop which fail to address the end-to-end challenge of connecting citizens’ data and services. As a result, investment may not deliver the intended benefits or represent value for money.”
There have been several attempts at digital ID in the UK, but the latest was born when then prime minister Keir Starmer launched the national digital ID scheme by pitching it as a way to control undocumented immigration, through making use of a government app mandatory when employers conduct right-to-work checks.
But the overall aim was to create a national ID to make public services quicker and more secure to access, with the potential to include private sector services such as gym memberships and parcel collections.
However, the programme was met with controversy and distrust – particularly as the digital ID industry was caught unawares – and by the time Starmer’s reign was coming to an end, the programme’s agenda had already seen numerous changes.
Digital ID scrapped – now what?
The NAO report was initially written ahead of prime minister Andy Burnham’s decision in July 2026 to scrap the controversial digital ID plans, but the challenges remain the same.
“Despite government’s recent announcement that it will not be going ahead with its digital identity plans, questions about how people can conveniently and securely prove who they are or something about themselves in a digital world remain relevant,” said Gareth Davies, head of the NAO.
“Experience from other countries suggests digital identity works best when people find it useful and want to use it in their everyday lives, together with effective security and privacy protections.”
While the government’s previous focus on digital ID revolved around allowing people to reuse a verified identity to access different online services, the NAO said this addresses only one part of the problem.
“Allowing someone to use the same identity to log in to different services does not automatically connect the underlying data across those services,” the report said.
Matching an individual’s verified identity with records held across multiple systems in multiple departments, with inconsistent data standards and legacy technology systems, remains a challenge.
This is compounded by the fact that the UK currently uses multiple identifiers across public services, such as National Insurance (NI) numbers, NHS numbers and Unique Taxpayer References. Unless these underlying issues are addressed, they remain “a practical constraint on what a digital identity could achieve”, the NAO report added.
Commenting on the NAO report, Public Accounts Committee chair Geoffrey Clifton-Brown said: “I have previously expressed my considerable concerns over the government’s proposals for digital identity, given the high costs and the legitimate questions around privacy and data protection.
“While the government has now decided not to proceed with those plans, the challenge of how people prove who they are and access services is not going away,” he said.
The NAO report highlighted that digital identity should not be regarded as a single product or technology, but as an ecosystem of services, credentials, providers, standards and governance arrangements.
The UK already has a substantial digital identity ecosystem with many government-approved services and providers. This includes 275 firms that, as of 2025-26, were involved in digital identity services. On the UK digital verification services trust framework, there were, as of 29 June 2026, 64 certified services from 47 digital identity providers.
In government, there is also Government Gateway, which is gradually being replaced for individuals by Gov.uk One Login, which had more than 56 million active accounts and was used almost 435 million times between April 2024 and March 2025.
However, according to the NAO, the mere existence of digital identity services does not equal them being able to be used consistently across different contexts.
It highlighted that even internationally, there is no single model for digital identity to work successfully, though many countries, including Estonia – often seen as a success story – are moving towards phone-based digital wallets with reusable credentials that can work across different sectors and systems.
Potential future plans
The NAO report said that whether the UK government can use its existing foundation for digital ID with success depends on whether it efficiently addresses long-standing constraints in legacy systems.
“In any future initiative, government will need to define priority scenarios and set out how to fund, deliver and integrate them across services,” the report said.
“Government will need to decide how far to build new public sector capabilities, such as a digital wallet and supporting infrastructure, and how far to rely on private sector provision operating within the trust framework.”
It added that any future government digital ID initiative will need to identify priority scenarios and set out how to fund, deliver and integrate them across services.
“It will need to decide how far to build new public sector capabilities, such as a digital wallet and supporting infrastructure, and how far to rely on private sector provision operating within the trust framework,” the report said.
“These decisions will shape costs, delivery risk, market participation and the long-term structure of the ecosystem,” it continued. “This will require a clear assessment of value for money across different delivery models.”
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