But the breadth of the legislation David Blunkett has bequeathed Charles Clarke means it will follow a rocky road as MPs and Lords consider a Bill which critics say creates several new offences, has weak safeguards and an unquantifiable cost.

The second reading today will focus attention on plans to introduce the cards in 2007-08 aimed at protecting Britain from terrorism, illegal immigration and benefit fraud.

Mr Blunkett and Mr Clarke argue that the cards will not only give Britons greater security but enhance their daily lives by providing safe personal identification for claiming a benefit, opening a bank account and buying on credit.

The cards will not carry medical details, but when someone is taken to an accident and emergency department their card could give doctors access to vital medical records.

The use of the cards will be a weapon against terrorism because a third of major suspects have used false IDs. It will also make human trafficking and identity theft more difficult.

Under the Bill, anyone over 16 applying for or renewing a passport will have to accept a card at a cost currently put at £85 for both. The cards will also be available separately at about £50 and could be used for travel in the EU.

The Identity Card Bill would create a secure database of addresses and biometric identities based on facial or iris recognition or fingerprints of everyone in Britain. Officials and ministers have promised that it will not be compulsory to carry the card — although privately many senior police officers believe the scheme will be ineffective without this requirement — or, initially, to possess one.

However, there will be a potential for their ownership to become compulsory with Parliament’s agreement. Ministers expect that 80 per cent of the population will have the identity card by 2014 as old passports are renewed.

The Bill contains no comment on when the cards could become compulsory and a government need not wait until 2014 before the cards become mandatory for 40 million people. The Bill also creates 31 new powers for a Home Secretary, seven new fines and eight new crimes.

Under the Bill people who fail to tell the Government when they move to a new address, for example, will face a fine of up to £1,000. Failure to register for the scheme will also carry a fine of up to £1,000 and anyone caught tampering with the database could be jailed for ten years. Failing to sign up to the database will carry a fine of up to £2,500 and individuals who submit a spoiled application could be fined up to £1,000. The same fine will apply to a failure to renew a card.

NO2ID, the campaign set up to fight the cards, claims that the promised oversight will be too weak. As Mr Blunkett promised, there will be a National Identity Scheme Commissioner, but he will report not to Parliament but to the Home Secretary, who must give copies of the annual report to Parliament but can edit them.

The overall cost of the project has been estimated at between £1.3 billion and £3.1 billion by Whitehall but opponents and computer experts are talking about figures of more than £13 billion once the cost of card readers, training and supervision are included. The Home Office maintains that the cost of equipment will fall as the number of customers increases and production rises. But will it work? Whitehall has a dismal record of implementing large IT projects.

Yesterday the right-wing think-tank Reform said that the US Government had estimated that one in 200 people cannot provide iris scans and up to 5 per cent cannot provide fingerprints. Neither scan is entirely accurate.

Reform also noted that although the cards are a defence against terrorism they would not cover more than 26 million admissions to Britain each year for short-term visits.

The think-tank also pointed out that employees who rely on black market labour already ignore national insurance numbers or tax codes and would take little notice of the new law. Also, the Department for Work and Pensions, according to Reform, said that fraud based on a misleading identity accounted for only 5 per cent of all benefit fraud.

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