Chip and pin ID cards?

ID cards could be fitted with chip and pin technology to help combat identity fraud.

The head of the Government agency tasked with producing the cards said there were no “technical obstacles” to adding chips to the cards and handing out pin numbers.

James Hall, chief executive of the Identity and Passport Service said adding chips might allow the cards to be used in ATM machines in the future.

Officials are also looking at chip and pin as a possible way to help combat online fraud and help protect internet shoppers.

It also emerged the Home Office has issued half as many ID cards for foreign nationals in the first four months than expected.

When the card was launched in late November ministers predicted that between 40,000 and 50,000 non-EU nationals would have cards by the end of last month. But by the end of last week 22,500 cards had been issued. Mr Hall said they had encountered “the odd wrinkle” in the system but overall it had worked “pretty well”.

A spokesman for the UK Border Agency (UKBA) said 42,000 foreign nationals had been through the enrolment process and had their biometric details taken.

Mr Hall said he was looking at how ID card holders could “assert their identities” online when the card is rolled out.

He said: “One of the reasons for the format of the card is we have the opportunity to put it in to card readers and potentially use it in existing networks such as the ATM network. One of the issues on the table is whether we should introduce chip and pin technology in to the card. There are no technical reasons why we couldn’t do that.”

Meanwhile, Home Secretary Jacqui Smith announced which companies would be given contracts worth £650 million for cards and biometric passports. IT firm CSC was given the £385 million contract to provide the application systems for passports and ID cards. And IBM won a £265 million contract to build the database that will store fingerprint and facial image data for cards and passports.

PA News