Federal Budget 2024: $300m put aside for digital ID program and digital currency research

The Albanese Government is pumping almost $300 million into expanding digital IDs and “exploratory work” on central bank digital currencies.

Federal Budget papers reveal the $288.1 million expansion of the program will “provide a secure, convenient, voluntary and inclusive way for people to verify their identity online”.

“Once a person has a digital ID, they will no longer have to provide copies of their ID documents to businesses or the government to verify who they are, and businesses will no longer have to store this information reducing the risks and impacts of data breaches and cyber-attacks,” the papers say.

The changes also mean the Department of Finance will take responsibility for the digital ID program from the Digital Transformation Agency.

$23.4 million will be allocated over two years for the Australian Taxation Office, Department of Finance and Services Australia to pilot the use of government digital wallets and verifiable credentials.

And even ASIO is getting in on the funding action, with $3.5 million allocated to Australia’s spy agency to “provide security assessments of entities seeking accreditation or participation” in the program.

And in a separate move that’s sure to stoke concern from cash activists across the country, $7.5 million over four years will be committed to consulting on proposed legislation around central bank digital currencies.

The money will be spent on “continuing exploratory work on central bank digital currencies, asset tokenisation and decentralised finance”.

The Budget papers also flagged “a new regulatory framework for payment service providers (including digital wallets and electronic stored value providers), including licensing and a mandated ePayments Code.

The $288.1 million digital ID funding will be broken up into eight different funding arrangements:

$155.6m over two years to the ATO for operating and improving myGovID and that system that supports access to government business services.

$46m over two years to Services Australia to operate and improve the identity exchange that underpins transactions within the system, as well as performing the function of system administrator.

$35.2m over two years for the Department of Finance to continue policy leadership and governance of the system.

$23.4m over two years for the ATO, Department of Finance and Services Australia to pilot the use of government digital wallets and verifiable credentials.

$11m over four years for the Attorney-General’s department to enhance the Credential Protection Register and help protect against identity crime.

$7.8m over two years for the Treasury to deliver data standards functions required by legislation.

$3.5m for ASIO to provide security checks for entities seeking accreditation or participation.

About 12 million Australians already have myGovIDs, according to the Budget papers.