Some people are already aware, and some would be surprised to learn, that a huge amount of information about them is held by government and by corporations. Obvious things such as where you live and your date of birth are known widely. However it is also possible to take databases that contain little or no personally identifying information (such as name, address or date of birth), link them to other databases that also contain little or no personal identifying information, perform statistical analysis of the combined data and from this create detailed profiles of individual people. This is possible because each of us can be described in many different ways and when we have enough information about people we can identify with a high degree of confidence even without the usual name and date of birth or other official personal information.
For example, let us say I had a database that told me the most recent hairdresser, the hobbies or interests, number of younger siblings, and the number of dependents, for every person in the United Kingdom. This database, you will note, does not contain any of the information that is normally considered to be personally identifying, such as name and date of birth. In fact it doesn't even contain information that is normally considered personal such as gender, marital status, or age. Now, if I am now told that we want to find a person who had their haircut at FemiCut Salon of Tinbridge, who plays piano, has two younger siblings and one dependent it will, most likely be possible to narrow down the choice to no more than two or three individuals out of the 60 million or so people in the United Kingdom. Indeed it might be possible to pick out one person immediately. Because my database doesn't contain personal identifying information I don't yet know exactly who this person is but how much extra information do I need to know to precisely and personally identify my two or three candidates?
Of course the above example might seem a little silly but that is perhaps because most people have not understood how easy it is to accumulate information and, once a standard identification number is issued, how easy it is to link apparently unrelated information. It is true there are practical technological problems to be overcome but the theory is not difficult and the technical problems are rapidly becoming easier to solve.
In real life it is unlikely that any organization will have access to all the information about all of the people but that is irrelevant. What we need to understand is that it is not necessary to have comprehensive information about every person in order to be able to accurately identify one person; it is only necessary to have lots of information and then subject it to statistical analysis. Furthermore gathering, storing and analysing vast quantities of information is exactly what computers are very good at, and the technology improves significantly every year.
The proposed issue of individual identity numbers will make it easier to link apparently unrelated information but those concerned about privacy should be more concerned about the acquisition of information in general.
For example, store “loyalty” cards might or might not help maintain a customer's loyalty; but that doesn't really matter because a far more important benefit of such cards, from the point of view of the card issuers, is that they allow the companies involved in the scheme to acquire huge amounts of information that then allow them to create detailed profiles of their customers and then sell that information to other companies or use it to design new marketing strategies or to issue special promotions only to the people who are most likely to take them up. When you sign up for the loyalty card you might not tell the company anything beyond your name and postcode but by the time you have used that card consistently in a variety of outlets for a few years they will be able to know, or be able to determine with a high level of confidence, many things about you including your age, your gender, who you are related to, what you do at weekends, your occupation, your marital status, how many children you have ... In many cases they would even be able to speculate with some confidence about who your friends are and what activities you share with them. All they have to do is keep records of all of the transactions you make using your loyalty card, add that transaction information to all the information they have about other card holders and then process it on some suitable computer systems.
They key to being able to do this kind of analysis is that you should be able to record the widest number of transactions from the widest number of people.
Having an identity card makes the process so much easier, but even without an identity card, it is possible for you to reveal far more private information than you consciously intend to reveal.
What difference then does it make whether you have an identity card or not:
First, you can choose not to have a loyalty card or bank card. You will not be able to choose to refuse an identity card.
Second, you can have a loyalty card or bank and choose not to use it. An identity card will rapidly become compulsory in many situations where you would not previously have had to identify yourself at all. This will happen partly because the government will enact legislation to ensure that an identity card is used for certain transactions, such as opening a bank account, booking airline tickets or getting a job, and partly because the government will enact legislation that cannot be satisfied except by demanding the production of an identity card. For example, in an attempt to prevent fraud and similar crime, the government might demand that companies such as ebay or real-world auction houses verify the identity of all persons prior to allowing them to trade.