Smartcard providers are gearing up for massive rollouts in the next two years in the wake of a federal government review into the introduction of a national identity card.

In addition to an ID card review by Attorney General Philip Ruddock, plans are afoot to introduce photographs on Medicare cards in a bid to combat identity fraud.

The government could introduce a number of cards following the rejection of a central national identity model on the basis that fraudsters would have to counterfeit only a single source of information.

Australian Privacy Foundation chair Anna Johnston said a system that relies on a single source will increase the incidence of ID fraud.

"Document verification is about rooting out fake foundation documents," she said. "It's strength is support for a dispersed ID model and works in a way to minimize privacy intrusions. It's a blind system and retains no data [but] its limitations is it won't deal with 'real' foundation documents obtained fraudulently."

Johnston would like to see more detail about the cost of a smartcard strategy; whether it will make a positive or negative impact; what the considerations are for alternative designs; what might undermine the strategy, and whether all government departments will sing from same song sheet.

"Each state should do a cost/benefit analysis and there needs to be more transparency around ID management initiatives," she said.

The Australian Government Information Management Office (AGIMO) is also working on a range of standards for tokens, smartcards, PKI and biometrics.

Speaking at an identity management conference, Tony Halberg, AGIMO team leader for government authentication, said: "We're considering what we need to do to encourage the use of technology.

"When we look at standards we can establish which ones might be useful."

The smartcard framework was released for comment in December last year and has so far received responses from a range of organizations - both public and private - and those already using smartcards.

"It's aimed at assisting government agencies to enable better service delivery for citizens and achieve consistency across agencies [and] hopefully it will improve interoperability," he said. "In developing frameworks, standards need to be workable. For example, smartcards need to be practical and affordable, and comply with security requirements."

And while embedding microchips in identity cards and documents may be seen as a step forward in the ongoing battle against fraud, there are fears of massive over-investment in unique systems with little interoperability.

Today's smartcard landscape ranges from enterprises using the technology for computer access control and e-passports to visions of a national ID card, a 'smart' Medicare card, as well as a card for all federal government employees.

Halberg admits there is a real risk "we could re-introduce the rail-gauge problem" (Australia's rail gauges differ from state to state).

But assistant secretary of the Department of Foreign Affairs and Trade's passports branch, Bob Nash said the reality is a machine can confirm the identity of an individual better than a person, giving weight to the security of a face-scanning e-passport.

"Some privacy advocates have misunderstood the government's intentions - we want to secure people's privacy and identity," Nash said.

"This technology ensures the person holding the passport is the same person to whom it was issued. We are not seeking any additional information."

Sony Australia, which has completed smartcard implementations in South East Asia, has submitted a proposal to AGIMO regarding smartcard adoption in Australia.

Sony believes Australia should adopt the Singaporean model, a solution dubbed EZ-link.

The company's smartcard product manager Adam Faulkner said its proposal advises the government that Australia doesn't have to re-invent the wheel.

"We have a good roadmap for Australia. The government is currently looking at different elements for smartcards and ways to add value; from our perspective the Singapore EZ-link card has been tremendously successful," Faulkner said.

"There are multiple applications for the EZ-link card in Singapore and it is stated that Australia needs a card for multiple applications so to just bring out one card with one function would not work - in Singapore the smartcard allows people to buy food at McDonalds or a 7-11, as well as being used as a building access control card.

"Singaporean users can go to a train station and recharge funds on the card, but the decision in Australia of what a smartcard will be will be driven by government as it will decide the where and when. There have been a couple of discussions, but we (Sony) are taking an advisory role until the government makes the decision."

The Singaporean EZ-link card was first implemented as an automatic transport payment system in April 2002. About seven million cards have been deployed since then, processing up to four million transactions daily.

The card itself, titled FeliCa, is a contactless, cheap card with an integrated circuit. It has previously been implemented in Hong Kong, China and Japan; however, due to Australia's size, smartcards will not come cheap.

"The Australian government is advised to leverage the regional economies of scale available to it, as a sustainable local market is not likely to generate price benefits without sacrificing quality and reliability," the proposal states.