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The Department for Work and Pensions (DWP) is planning to issue a framework contract worth around £200 million for the supply of identity assurance services for 21 million benefits claimants.

The government's new identity assurance (IDA) systems will support its planned Universal Credit system. The framework deal which is expected to include a multiple number of suppliers will last four years with a possible two-year extension, depending on the progress of the Universal Credit and the personal independence payments systems it will support.

The IDA systems will be designed to ensure the identities that citizens are using to claim benefits or access services online can be verified. When the Child Tax Credit system was first introduced the government at the time suffered large losses as a result of fraudulent claims made online.

Suppliers under the framework will be chosen by June 2012, with systems expected to be fully operational from March 2013.

The DWP said: "In supporting the digital by default policy in general and the government's welfare reform agenda in particular, the Cabinet Office has produced guidance for all major public service provider departments, relating to the need for identity assurance of members of the public when accessing government services."

Claimants will be asked to prove their identity either through online checks, over the phone or through face to face checks. The current government scrapped the £10bn-plus national identification card scheme, which would also have been used to track identities of benefits claimants.