If something like this was in widespread use it would have much more impact since countries would see whole swathes of the internet immediately go dark when they make stupid laws.
Wouldn't work with somewhere like China, but the UK might still be capable of being shamed.
I wouldn't put it passed them to require the digital ID to access the internet passed curfew.
How is someone supposed to benefit from a thing whose only function is to reduce the friction against forcing them to correlate their otherwise-independent activity against their will?
The wallet uses Digital Verification Services (DVS) to poll APIs in front of the data the government already holds on you. These services check details you enter against that data and return cryptographic signatures for each. The wallet puts these together as IDs in a bespoke way, depending on what you need to prove. You can have any number of variations of ID and none of them are centralized.
Some of these signed proofs can be disclosed using Zero Knowledge Proofs (a cryptographic means of demonstrating something without demonstrating anything else) which would actually make it harder to 'correlate' you in the way you describe.
Another thing to bear in mind, the ID is backed up by the Data (Use and Access) Act 2025 which reinforces data protection laws and actually wards against the use you describe.
There's a lot of misinformation flying around about this proposal, but the design itself doesn't match the negative characterizations. It's surprisingly good and weighted to the citizen.