The Identity Verification Service (IVS) project is being headed by the Department of Internal Affairs, which this week released a tender for research on the potential uptake "in the work and private lives of the public" for such a scheme.
The tender notes that there is "a need to understand the actual and likely perceptions of special interest groups so that the IVS, which is an opt-in identity verification service, is not mistaken for a de facto identity card."
As in Australia, proposals for national identity card systems have in the past met with strong opposition in New Zealand. In the early 1990s then social welfare minister and later Prime Minister Jenny Shipley proposed a "Kiwi Card" scheme. Like the bird the card was named after, it didn't fly.
Anthony Ravlich, chairman of the Human Rights Foundation has some concerns about privacy and misuse. While the system is voluntary now, he sees no reason why that couldn't change in the future. "There seems to be little to stop a government from making such a scheme compulsory at some future date despite it involving people being forced to give information," Ravlich says.
"Privacy is only protected by ordinary law, the Privacy Act 1993, which government can change.
"However if the right to privacy were included in the New Zealand Bill of Rights Act 1990 which was then made supreme law this would provide some protection. However it is very unlikely for this Act to be made supreme law at a time when civil liberties are being curbed globally to address the problem of terrorists and other undesirables".
However the Department of internal Affairs is at pains to stress the voluntary nature of the IVS saying people "will always have an option to use or not use the IVS and GLS (Government Log-on Service) service; this is one of the foundation policy principles for online authentication that Cabinet endorsed in 2002."
They also stress the IVS provides people with an option of verifying who they are online while the GLS provides for ongoing confirmation that it is the same person.
"In separating the functions of the two services the New Zealand approach has been to 'design in' privacy protection".
Results of the research, which will also explore how much people would be prepared to pay for such a service, are due in October and will be used to back a business case for implementation to be presented in December.
The core GLS is working in a test environment and will be deployed to several agencies once two-factor authentication is added.