Under the coalition government's first Home Office Bill, which received Royal Assent yesterday, all ID Cards will be cancelled within a month and the database containing information intended for the cards will be physically destroyed within two months.

Home Office minister Damian Green said: "The Identity Card Scheme represented the worst of government. It was intrusive, bullying, ineffective and expensive.

"The Government is committed to scaling back the power of the state and restoring civil liberties. This is just the first step in the process of restoring and maintaining our freedoms."

According to the government, the Identity Card Scheme and associated work around biometrics has already cost the taxpayer £292m, while a further £835m was expected to be invested in it. It is unclear how much of this investment would have gone towards printing the cards.

Initially announced in 2008, trials of ID Cards were run in Manchester, with Security Printing and Systems given the initial contract.