Digital ID laws finally pass Australian parliament

After a long battle, Digital ID laws have finally passed the Australian parliament. This move aims to dampen the oversharing of personal information in order to enhance privacy protections in a landscape increasingly vulnerable to cyber threats.

The bill’s passing coincides with a significant financial commitment that was announced ahead of the federal budget this week. The government has earmarked $288.1 million to the digital ID scheme, bringing the total funding to over $1 billion.

The Digital ID bill getting the green light is the culmination of a decade-long effort to modernise identity verification in Australia.

At present over 10 million Aussies use MyGovID for governmental transactions. The benefits of this include a reduction in processing times, such as obtaining a tax file number, from 28 days to ten minutes.

However, as former NSW digital minister Victor Dominello highlighted in a recent LinkedIn post, this system is limited to these federal interactions. This leaves a huge a gap when it comes to activities such as opening bank accounts, applying for rentals, entering clubs and more. This often leads to the oversharing of personal information.

Mr Dominello has been an advocate for Digital ID throughout his political career, and has continued this push since entering the private sector.

The new legislation aims to bridge this gap, enabling Digital ID usage across various sectors — including state governments and in the private sector.

Finance Minister Katy Gallagher has been a vocal advocate for the scheme, highlighting its potential to streamline access to services and reduce the burden on businesses to collect and store personal information.

This has become an increasingly important argument for the scheme, as data breaches have become increasingly common in recent years: most recently this week with the ironically named MediSecure. 

The implementation of the Digital ID system will be in phases, with state and territory governments first gaining access to later this year.

Australia Post, banks and credit card operators will be among the first to utilise the system. Minister Gallagher confirmed in March that accredited private businesses will be able to apply to the Digital ID System within two years of the rollout, thanks to bill amendments secured in the Senate.

Further amendments from The Greens also stated that that businesses must provide non-digital options for services, maintaining accessibility for all Australians.

Despite broad support, the bill previously faced opposition from the Coalition, primarily due to concerns about the phased approach. Shadow Minister for Government Services Paul Fletcher warned of potential fragmentation in the digital identity landscape, citing the traction of private providers like ConnectID.

According to the government, the bills are expected to receive Royal Assent in the coming weeks, with the Acts commencing by November 2024. The Australian Competition and Consumer Commission (ACCC) and the Office of the Australian Information Commissioner will regulate the system.

With the bill now law, attention will now shift to its implementation. Proofs of concepts and pilot trials will be conducted to refine the system before a full rollout.

Never miss a story: sign up to SmartCompany’s free daily newsletter and find our best stories on LinkedIn.