Manitoba's plan to combine health cards with drivers' licences is on hold until the province figures out how to deal with the costs as well as the privacy implications of packing a multitude of personal information onto a single piece of plastic.

The Progressive Conservative government says it's cancelling a $13-million plan to create high-tech identity card over concerns about project costs, privacy, data management and the need to enact legislation required to manage the cards. But they are planning some form of new identity-management system.

Manitoba's plan to combine health cards with drivers' licences is on hold until the province figures out how to deal with the costs as well as the privacy implications of packing a multitude of personal information onto a single piece of plastic. 1:42

The former NDP government proposed the combined identity cards in July 2015 as a means of saving money and conducted a series of consultations that fall. The NDP reannounced the plan in January 2016 and attached a $13-million price tag to the transition, vowing that cost would not affect Manitoba Public Insurance rates.

Now, PC Health Minister Kelvin Goertzen says the project has been cancelled and will be replaced by a more comprehensive identity-management system.

​"If the province is looking at implementing a single personal information card, it has to be done right the first time. As the parameters of the project were reviewed, a number of issues were identified that needed to be looked at in more detail," Goertzen said Thursday in a statement.

"This includes examining the possible policy, legal and legislative changes that might be needed, as well as ways to ensure the safe storage and management of personal health information. We also have to determine how to assess privacy legislation compliance."

The decision to cancel the project now "will prevent additional costs for implementation and ongoing support beyond those anticipated in the initial proposal," he said.

The province says $2.1 million has been spent on the project to date. Goertzen promised to use whatever data the province has gathered so far.

"The work compiled to date will be used to develop and implement a strategy for identity management that can be applied across government," he said.

When the combined cards were announced in 2015, they were praised by Manitoba Public Insurance as a convenience measure and Siloam Mission as a way to ensure people with no fixed address have photo identification.

Helps homeless: Siloam manager

Vanessa Gamblin, who manages the drop-in and shelter at Siloam, said the cards would help people to access employment, social services and housing and to seek out their birth families.

She said she understands concerns about costs, but only in the short term.

"There are many more costs when it comes to community members that are experiencing homelessness," Gamblin said. "You're paying more dollars for keeping people homeless."

NDP justice critic Andrew Swan (Minto) said he was surprised by the cancellation of the card program. All Manitobans are embarrassed by flimsy paper health cards that do not allow access to health information, he said.

"We know there are privacy issues and we know there are operational issues, but this is the right thing to do," he said.

Swan said he isn't sure whether the province is attempting to practice austerity or simply trying to cancel as many NDP projects as possible.