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PayPal Gets A Slice Of £25m DWP Identity Contract

UK citizens will be able to register for the new Universal Credit system using their PayPal credentials

On by Peter Judge 3

PayPal has been awarded a place in the Government’s framework for Identity Assurance, so citizens may be allowed to use their PayPal credentials to prove their identity to access government services – particularly the new universal credit system.

TechWeekEurope learned of the deal back in November, but it has only now been made public.

PayPal is the eighth name on a £25 million contract with the Department of Work and Pensions (DWP) published last week, which will allow citizens to use their credentials with commercial organisations, when they register for government services. At this stage, it is not clear what share of the contract PayPal will get, as it depends on which agencies choose to offer PayPal identification.

Security fingerprint analysis

PayPal benefits

Francis Maude announced the scheme in November 2011, calling it a “Little Brother” initiative, to contrast it with the ID card scheme proposed by previous government, which was seen as costly and authoritarian. The idea is to use commercially-available systems for people to identify themselves when contacting government services, making it simpler to get people using services online for minimal public expense.

The framework will “leverage secure identity assurance capabilities that are already available or will be developed in the private sector, allowing citizens to choose the private sector partner(s) they wish to use to assert their identity and so access a government service,” the DWP said.

“The service will be required to provide identity assurance for approximately 21 million claimants of DWP services,” the announcement read. The other firms awarded a place include Experian, Verizon, the Post Office, Cassidian, Digidentity, Ingeus and Mydex.

Most commentators on the Government Digital Service site have welcomed the move. “There are eight federated ID providers that a claimant can choose – but they will do more than just provide ‘Facebook’ type logon,” said Brian Wernham, author and commentator on project management and government IT. “They will be carrying out background checks on claimants to ensure that they are who they claim to be. PayPal and the others will be providing a ‘Level Of Assurance’ (LOA) on each claimant’s identity using the recently published Cabinet Office Identity Assurance ‘Good Practice Guidance’ (GPGs).”

However,  it may prove unpopular as PayPal’s parent eBay has been criticised for avoiding UK taxes - paying only £1.2 million in 2010 on £789 million profit.

Elsewhere, the DWP has shown itself somewhat clumsy in its handling of social media, despite the government’s enthusiastic backing for online culture. The DWP has been criticised for firing 11 staff who used social media such as Facebook and Twitter.

“In an open, democratic society it is becoming increasingly unacceptable and difficult to deny employees access to such important elements of the internet,” said David Gorodyansky, CEO and founder of VPN provider AnchorFree. “Social media is an integral part of how we communicate with colleagues, peers and influencers. The UK government, particularly the Department of Work and Pensions, should be setting an example by promoting freedom of access and focusing on educating people about safety and privacy online, whether at work or at home.”

The DWP has been  asked to clarify the actual figure which PayPal can expect to get from the contract.

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Peter Judge

Author: Peter Judge

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Last comment




3 replies to PayPal Gets A Slice Of £25m DWP Identity Contract

  • On January 22, 2013 at 10:36 am by Brian M

    About as stupid as it gets to let the likes of PayPal etc be responsible for Identity. Each company is a potential weak link and with the £ billions involved in benefits system it will be targeted by the bad guys. With this system they only have to penetrate a commercial company to have a field day – not to mention what these companies will do with the valuable data.

    The words criminal negligence by the government come to mind.

  • On January 22, 2013 at 12:11 pm by species5618

    hmmm, did Paypal not move out of the uk to Luxemburg to avoid UK Tax

  • On November 19, 2013 at 12:37 pm by humanist1965

    What UK Government should be doing here, of course, is to adopt a #FederatedIdentity protocol and make the #IdentityProvider work to this standard.

    Problem is #PlanetEarth hasn’t really decided/agreed on what this #FederatedIdentity protocol will be yet.

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