Abolishing the previous government's national identity card — dubbed the Access Card — means Labor will save over AU$1 billion, according to the Federal budget.
The Access Card was a controversial project designed to tie welfare payments, health and other government services to a nationally administered smartcard. It was put on the backburner by the Howard government shortly before the last general election was called.
Labor scrapped the Access Card in December last year, and promised in March it wouldn't introduce a new one.
"We are committed to achieving best practice in the provision of government services, but we are not considering a compulsory identity card," a spokesperson for the Minister for Human Services Joe Ludwig said.
The decision to scrap the card will save the government a total of AU$1.2 billion in the period leading up to the 2010/2011 financial year — AU$310 million from the current financial year.
However, the government is committed to a welfare debit card, which some observers say has similarities to the Access Card. The cost of the Welfare Debit Card, combined with a school attendance and enrolment pilot, will run to AU$36.4 million over three years.