The Department for Work and Pensions is to spend £200 million on a framework for private sector companies to handle the online identities of its 21 million benefits claimants, as a part of the government’s ‘digital by default’ policy.

In a contact notice, the DWP said it wants to establish a framework of private sector suppliers to deliver identity assurance services in a variety of circumstances, including online, telephone and face-to-face situations. The notice

The tender document notes that multiple suppliers will be required to serve different geographical and demographic sectors. "Different suppliers may have reason to support a particular group more effectively than other groups," it says.

Suppliers will be responsible for managing DWP customers’ credentials, as well as ensuring that those using its services are who they claim to be. The contract notice says that suppliers would be responsible for user names and passwords, as well as voice samples and memorable information.

Patrick Curry OBE, director of the British Business Federation Authority, told Information Age that reusing commercial identity credentials for government purposes raises novel questions. "One issue in this model is establishing an identity in the first place," Curry said. "How do you know that the identity provider (IdP) was rigorous enough in proving an applicant’s claimed identity? Another issue is liability – what happens if something goes wrong? Governments aren’t in a good position to accept liability, but making the IdPs liable acts as a disincentive to their participation."

Suppliers will be chosen by June 2012, with services becoming fully operational by 2013.