The credibility of the Government's tendering process for its £2 billion biometric identity card scheme was cast into doubt yesterday after all the remaining companies interested in the scheme's IT contracts advanced to a shortlist of qualified bidders.

The framework deals, which will be signed next week, do not guarantee a role in the ID programme, but they qualify the companies to bid on contracts expected to be offered this year.

IBM, Fujitsu, Computer Sciences Corporation (CSC), Thales and EDS survived the cut, but were the only companies left on the list after Accenture, BAE Systems and Steria dropped out.

The announcement was controversial and industry insiders said that the troubled procurement process had been a debacle. Bill Nagel, an analyst for Forrester Research said: “Clearly the Government was expecting a more competitive bid process, so now they have to deal with who they have got.

“I think it is more indicative of the uncertainty surrounding the future of the ID cards scheme that not only did the Government not get more bidders in the first place, but that you had people dropping out throughout the process.”

The Government denied that the credibility of the project has been damaged by allowing all five remaining bidders to make up the shortlist. A Home Office spokesman said: “We looked at the final five, we considered that they all scored well enough to meet all of our criteria. To suggest that the only way to demonstrate that the process has worked is to remove one at the final hurdle is not a rational argument.”

However, industry insiders pointed to the inclusion of CSC, an American company, in the shortlist as evidence that the process was not as rigorous as it could have been. Reports have suggested that the company's subcontractors had dropped out, starting with Siemens six months ago and followed by Unisys last month. CSC said that it could deliver on the ID contracts and has “two organisations working with them on the ID Cards programme”, but it would not reveal their names.

Market insiders said that there remained concerns about the risks with long-term involvement with the project, as the Conservatives have said that they will ditch ID cards should they form the next government.

Commenting on yesterday's announcement, David Davis, the Shadow Home Affairs spokesman, said: “We gave advance notice to all potential contractors over a year ago that a Conservative government would cancel the ID cards project. Along with growing evidence of the risks and costs of ID cards, we have seen declining commercial interest, reflected in the dwindling numbers bidding for contracts.”

Some have suggested that the Tories' position could result in costlier contracts because the participating companies would have to include the added risk in their costings. However, the Government argued that the contracts would still be needed despite the Tories' plans, as “80 per cent of the scheme will be about bringing the UK passport up to international standards”.

The Government also sought to allay other concerns about the project by confirming that all sensitive personal information would be held in the UK and a significant majority of the jobs created by the scheme would be British, despite the lack of British suppliers in the final shortlist.

The first cards are scheduled to be issued to foreign citizens this year and to British citizens next year.

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