Australia’s $1 billion digital ID system faces audit scrutiny

Australia’s national digital ID program will undergo a formal audit this year. 

The Australian National Audit Office (ANAO) is set to examine governance, risk management and evaluation of the AU$1 billion-plus scheme (US$674 million). The inquiry comes roughly a year after the system’s broad rollout and ahead of its planned expansion to the private sector.

Legislation enabling the economy-wide use of digital ID passed in 2024, laying the groundwork for banks, telecommunications providers and other private entities to adopt the platform later this year. 

The audit will assess how the Department of Finance has overseen the program, which has been in development for more than a decade, and whether its rapid growth has been matched by adequate safeguards. The report is expected by December. 

The digital ID system is designed to provide Australians with a secure, government-backed credential for online transactions and reducing reliance on multiple logins and passwords. 

In 2025, the Australian government digital ID system (AGDIS) processed 80 million verified transactions — more than triple the previous period — and 15 million digital IDs were created, enabling access to 246 government services. 

Most of these IDs are biometrically verified to a Strong level, according to the Australian government’s Department of Finance. Western Australia has become the first state to allow driver licences to be used to create a Strong digital ID, a capability previously limited to passport holders, with the rollout covering 2.2 million licence and permit holders. This year 90 percent of eligible Australians will have access to digital driver’s licenses. 

More than two million ABNs are now linked to the Relationship Authorisation Manager (RAM), strengthening business identity assurance. Looking ahead, the government’s priority is to expand digital ID across the economy. 

This includes preparing for private sector participation, advancing a rental application pilot to safeguard renters’ data, updating AML/CTF guidance so digital ID can meet KYC requirements, and exploring the potential for government-issued verifiable credentials to be stored in digital wallets. A Request for Information will soon invite vendors to contribute expertise toward building this credential system.

The ANAO is welcoming public contribution for consideration as it audits, with the office accepting contributions until June 28. It emphasizes that it is assessing the effectiveness of the finance department’s administration of the digital ID program rather than assessing the merits of government policy. 

With private-sector participation looming, the audit’s findings could shape how Australians interact with digital identity in everyday life and determine whether the system can deliver both trust and efficiency at scale.

The ANAO’s decision to scrutinize digital ID comes amid a broader wave of technology-related audits, including probes into AI use across agencies, cybersecurity at Parliament House, and the defence department’s major back-end system upgrades.

Article Topics

Australia  |  Australian Government Digital Identity System (AGDIS)  |  digital ID  |  digital identity  |  government services  |  myID Australia