The above document describes the existing paper-based process and I believe the only thing it proves is how cumbersome it is for foreign nationals working legally in the UK. I don't understand what you mean by "mandatory for everyone", because the rules for UK nationals do not change:

> If you’re a British or Irish citizen, you can prove your right to work in the UK with either of the following: a British passport, an Irish passport or passport card. Your passport or passport card can be current or expired.

https://www.gov.uk/prove-right-to-work

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Okay, that will be still the mandatory way of proving your right to work... if you're a foreign national, because that's the only situation when the question at all arises. The upcoming Digital id project FAQ clearly explains that nobody will be obliged to show it to police, for example - it will be only used when applying for work.