MINISTERS are searching for ways to limit the cost of their identity card scheme amid concern among MPs that it is spiralling out of control. The London School of Economics suggests that each card could cost £300.

Home Office officials say that scope for reducing costs is limited. Charles Clarke, the Home Secretary, is re-examining the gathering and checking of personal data, one of the most expensive parts of the project, to see if it can be streamlined.

It is cost, rather than civil liberties, that is emerging as the biggest problem for the Government, which has been slow to bring back the Identity Cards Bill. The legislation cleared its Commons stages before the election, but ministers did not attempt to push it though the Lords before May 5, knowing that they would probably fail.

They are preparing for a second reading the week after next, although they have not formally set a date. Mr Clarke has made a commitment that all the data gathered for the cards is “clean”, so is sticking to plans for everyone to be interviewed, their birth certificates and other documents checked, and fingerprints taken. That limits his room to manoeuvre.

The Government’s figures say that over the next decade the cost of running the scheme, in conjunction with a biometric passport, would be £5.8 billion, or £93 for each card.

However, a report from the London School of Economics suggests that the cost of implementing and running the scheme will be much higher, between £12 billion and £18 billion. This could make the average cost of each card £300, unless the Government subsidises the scheme. Gordon Brown, the Chancellor, has ruled that out. Home Office officials dismissed the LSE figures.

MPs say that Mr Clarke will come under pressure when the Bill comes back to the Commons to make guarantees on costs. A Home Office official said: “We will not be able to give a detailed fee regime at second reading for commercial reasons, but we will be able to give some reassurances on cost.”

David Davis, the Shadow Home Secretary, has dubbed ID cards “Labour’s poll tax” and will focus on costs in the debate. The Conservatives and Liberal Democrats oppose the scheme and 16 Labour MPs have signed a Commons motion saying that the case for ID cards is unproven.

Questions are also being raised about the timetable for introducing ID cards.

Sources in the computer industry, which will be bidding for the contract, have suggested that it will not be able to meet the Government’s deadline.

The Home Office wants cards to be issued from the end of 2007 and into 2008. But that timetable presumed that the Bill would be on the statute books before the election, with bidding starting this summer. Procurement will not now start until the beginning of 2006 at the earliest.

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