At some point the government will have to trust the authorities to guard the decryption, but is there anything that can guarantee that? After all, the purpose of blockchain is for everyone to be able to confirm and validate all the data it contains.
It's been working for 16 years in Estonia:
https://e-estonia.com/solutions/cyber-security/ksi-blockchain/And yeah, Estonia had a blockchain before Satoshi!
Digital identity is nothing new, we've been using this in Europe for a decade, it just makes the headlines because of the blockchain thing but in reality is just a distributed database, much like Cassandra.
Citizens' information can be verified securely and swiftly, enabling quicker access to services and reducing waiting times. The decentralized nature of blockchain also means that citizens have more control over their own data and how it is accessed and utilized.
Where did you get that from? Just imagine what would happen if everyone were allowed to tamper with his official data stored by the government, changing and denying access on its own. It's nothing like that, the access refers to official government agencies and branches, not citizens.
In case anyone is interested ina more reliable description of what's planned:
https://cryptorank.io/news/feed/87eaa-brazil-blockchain-based-national-identity