Identity Documents Bill

In speaking to Amendment 3 I shall speak also to the other amendments in this group, Amendments 8 and 20. We come to a very important matter of principle—the Government’s decision to refuse to compensate cardholders for the scrapping of the scheme. My noble friend Lord Rosser already picked up some of the points when he spoke to the first group of amendments. I ask the Minister what the Government have to say to the thousands of individuals who have spent money buying cards in good faith. These cards were sold on the basis, and the purchasers were given the impression, that they would be valid for a wide range of purposes for 10 years. However, there has been a change of government, a change of policy, and seemingly no care for those left inconvenienced and out of pocket as a result. I wonder what the Government now have to say to those people. Why do the Government seem happy to penalise them? We have been told that the cost of £360,000 to compensate all those who will be eligible for a refund under the terms of Amendment 3 is too much. However, that is the maximum figure. It is quite plausible that a certain percentage of those eligible to claim will choose not to do so. It would be possible to entertain a time limit, a date after which claims could no longer be made, which might lower the total compensation figure. However, the important factor is that compensation had been offered. On Second Reading, the Minister said: "““We realise that some people who spent £30 for a card with a 10-year life expectancy will be disappointed that it will be cancelled later this year without any refund, but those who chose to buy a card””—" this is a remarkable statement— "““did so in the full knowledge of the unambiguous statements by the coalition parties that the scheme would be scrapped if we came to office. They cannot now expect taxpayers to bail them out””.—[Official Report, 18/10/10; col. 715.]" That is, to say the least, unsympathetic. To rely on the public having an in-depth knowledge of party manifestos or coalition agreements—documents that in most cases were published long after most cardholders had spent £30—is a touch unrealistic. The Government's continued reliance on their insistence that people knew well before the election what would happen if a Conservative Government were elected is an extraordinary decision. I received an e-mail this morning from Mr Nicholas Hodder, who informed me that, since obtaining his ID card in May this year, he had presented it 30 times in order to enter or leave the Schengen area. I ask the Minister why someone like Mr Hodder, who in good faith purchased the ID card and has used it effectively, should suddenly be told, despite the fact that he bought it for a 10-year period, that it will be taken out of use very shortly and that he is not to receive compensation? I pray in aid the impact assessment produced by the noble Minister’s department. The IA looked at five options. Under option 3, the return of cards is not required, but there will be a return of fees to current cardholders. The benefit of that option over the do-nothing option 1 is said to be: "““Reputational benefits for the government, in dealing with people who purchased a now-useless card in good faith””." Is the Minister not concerned about the reputation of the Government? Does she not see that in not agreeing to refund £30, the Government are developing a new principle, which can only reduce trust in governments generally? Why is it acceptable to compensate companies for termination of contracts? I refer her to the preferred option of the Government. As far as concerns funding, the cost of £22 million is contained in the summary of policy option 1 in the impact assessment. I will come on to whether it should be policy option 1. Option 1 refers to the costs of, "““termination of contracts with contractors””." Why is it reasonable to pay the costs of terminating contracts with contractors, but not with members of the public? I refer again to the impact assessment. The preferred policy option—that of cancelling ID cards without refunds and with no requirement to return the cards—states that the £22 million includes the cost of the refund process. Clearly, at one point, the Government considered including refunds in the policy option that was being preferred; but presumably at some point they decided to drop this. None the less, it would appear that the £22 million must include the cost of refunding fees. Perhaps the Minister can clarify this point. My confusion about the impact assessment of 26 May 2010 is that it refers to five options. Option 1, do nothing. Option 2, scrap ID cards, return of cards not required, no return of fees. Option 3, scrap ID cards, return of cards not required, return fees. Option 4, scrap ID cards, return of cards mandatory, no return of fees. Option 5, scrap ID cards, return of cards mandatory, return fees. On page 1 of the impact assessment, signed by the Minister, Damian Green, on 29 May 2010, it states: "““Option 2 is the preferred option””." But when I turn to the analysis on page 2, this option is described in the heading as ““Policy Option 1””. Can the Minister clarify exactly which option we are talking about? That brings me to Amendment 8. This is a straightforward and, I believe, much needed addition to the Bill. Conservative Party Ministers, when in opposition, made claims about the current cost of the ID card scheme that ranged wildly from nearly £1 billion to up to £20 billion. However, the national identity service cost report of October 2009 stated that the projected forward cost of providing ID cards until 2019 was £835 million. Crucially, this figure does not equate to the savings to be made from scrapping the scheme. We know this because the impact assessment which accompanies the Bill states at the bottom of page 4 that: "““The October 2009 cost report indicated that cancellation of ID cards would avoid future costs of £835m up to October 2019. However, these costs were planned to have been recovered through future fees to ID card purchases. Therefore, there are no benefits to the taxpayer from Year 3 onwards””." The tables set out in the impact assessment reveal that total savings from scrapping the scheme are £180 million, and the total cost of cancelling ID cards and the NIR are stated as £22 million. What is clear from the apparent muddle is that the Government have been using rather dubious figures to claim savings on the scale that they would have liked to see. I believe that a definitive and preferably independent audited costs and savings report is urgently required to clarify this matter for all concerned. It would be useful if it were part of the duty of the Government to provide clarity in this area. Amendment 20 is consequential on Amendment 3. I beg to move.