Experts Weigh In On Government Cutting £1.3 Billion AI Funding Budget

After the announcement that the UK will soon announce the AI Action Plan led by Peter Kyle, shocking news has since come as the UK announced they will be scrapping the £1.3 billion that was meant for funding AI projects.

The UK has canceled the planned £1.3 billion investment previously outlined for various technology and AI projects. This includes an £800 million project for an exascale supercomputer at the University of Edinburgh and £500 million intended for the AI Research Resource.

 

Why Are They Cutting The Funding?

 

The Department for Science, Innovation and Technology (DSIT) stated that no new funding had been allocated in the previous government’s budget for these programmes. This is the government’s way addressing the billions of pounds in unfunded projects. Officials have stated that these decisions are necessary to stabilise the economy and support the nation’s growth objectives.

 

What’s The Plan Instead?

 

The government has initiated the AI Opportunities Action Plan, directed by industry expert Matt Clifford. This strategy will reevaluate and adjust the UK’s compute infrastructure and consider how AI and other emerging technologies can support the country’s industrial strategy. Despite the cuts, £300 million previously allocated to the AI Research Resource will continue as planned, ensuring some continuity in AI developmental support.

 

Experts Share Their Views

 

Experts share mixed emotions regarding the big cut, and what it means for the UK. Some believe we were on the right track until this news, whereas others understand where the government is coming from. These experts have shared their thoughts below…

 

Our Experts:

 

Libero Raspa, Director, adesso UK
Nick Isherwood, Group Chief Information Officer, Advania
James Clough, CTO and Co-founder, Robin AI
Michael Queenan, CEO and Co-Founder, Nephos Technologies
Jeff Watkins, Chief Technology Officer, CreateFuture
Kevin Cochrane, CMO, Vultr
Chris Black, AI Evangelist, Vizrt

 

Libero Raspa, Director, adesso UK

 

 

“The cancellation of funding for key tech and AI projects is a significant setback for the industry. The rapid rise of AI adoption requires substantial investment and without this, companies may struggle to innovate and fall behind international counterparts.

“Technology, particularly AI, should be central to enhancing efficiency, and investment is crucial for successful tech projects that boost productivity and growth nationwide. The government should be collaborating with academia and industry, working with partners and AI experts that are leading AI projects from concepts to implementation to create solutions to key problems, boosting efficiency and driving growth while minimising risks.”

 

Nick Isherwood, Group Chief Information Officer, Advania

 

 

“We welcome the introduction of the EU AI act as it brings a consistent framework for the use and supply of AI systems, offering greater assurance for consumers that AI technology is assessed against a risk-based classification system before entering production. With the different risk levels, the greater the regulation that will apply, and AI that poses an unacceptable risk (such as AI that infringes on fundamental rights or privacy), will be prohibited.

“The EU is focussing on promoting the ongoing innovation of AI technology whilst also ensuring it is safe, transparent and ethical to use. This will boost consumer trust and increase confidence that AI can provide tremendous benefits to society if used appropriately and governed by a set of standards that the whole industry can get behind.”

 

James Clough, CTO and Co-founder, Robin AI

 

 

“It’s surprising news, but we’re hopeful that the Government’s decision to pull the plug on several current AI projects is about reallocation rather than retraction and cost-cutting. The UK has an amazing opportunity to be a leading player in the global AI race, but it’s a short window in which investment today can massively pay off tomorrow.

“We want to see the new Government get a move on and show us its plan for AI investment, and how it intends to support British AI scaleups in applications where we’re already strong – like legal or deep-tech. It’s always harder to do value-for-money calculations around deep-tech investment, but it is has historically delivered some of the highest returns, so it is short-sighted if the current projects have been cut on that basis.

“Ultimately, AI in business is going to have a transformational impact on UK productivity. But it would be so much better if this happens using AI technologies that are British-made rather than Silicon Valley.”
 

 

Michael Queenan, CEO and Co-Founder, Nephos Technologies

 

 

“The announcement that Labour is scrapping the Conservative’s £1.3bn of funding for technology and AI projects may seem like a blow to the tech sector, but we shouldn’t be disheartened. It doesn’t mean that tech and AI have fallen off the political agenda.

“The appointment of Matt Clifford to kickstart a new AI Opportunities Action Plan is a massive step in the right direction. By shelving the Tories’ funding to create an exascale supercomputer, the money can be spent on specific projects that use AI to improve public services and develop new products. With NHS waiting times at an all time high, AI could be a gamechanger for clearing the backlog of appointments.

“Some GP functions could certainly be enhanced with AI – after all, they are not the ‘family doctors’ that they used to be due to the high demand. So telling an AI your symptoms for it to prescribe you the right drug will be the same as the current GP experience.

“This is where AI investment should be going and I would like to see a specific task force around this space. I hope that this is the direction that Labour moves in after scrapping the previous plans. In the long term, it will be far more beneficial than having the fastest supercomputer in the world.”

 

Jeff Watkins, Chief Technology Officer, CreateFuture

 

 
“As a technologist somewhat invested in AI, I was disappointed to see that the UK’s new Labour government has rolled back plans to invest £1.3B into the technology.

“Unpacking that a bit, £800m of this was earmarked for the construction of an exascale supercomputer at Edinburgh University, with a further £500m of that funding being for the AI Research Resource (AIRR). The already allocated £300m for the AIRR will be unaffected. This comes as the Department for Science, Innovation and Technology stated, “The Government is taking difficult and necessary spending decisions across all departments in the face of billions of pounds of unfunded commitments”.

“Naturally, the industry’s initial response has been one of great disappointment at this sudden change in tack. From my perspective, it’s not really about the specific funding mentioned in the £1.3B investment, it’s the message it sends to the UK and the rest of the world – particularly given previous attempts to put the nation on the map of AI innovation and safety – remember the Bletchley Park Summit in November 2023?

“Of course, buried underneath the headline there’s often the real message. In this case, Labour have announced their own initiative, the AI Opportunities Action Plan which will “identify how we can bolster our compute infrastructure to better suit our needs and consider how AI and other emerging technologies can best support our new industrial strategy”. So, all is not lost, but we could be unnecessarily setting ourselves back time-wise until a new investment strategy is in place. And, as we all know, in the field of AI, time is really critical, with innovation continuing at break-neck pace.

“After the “Governing in the Age of AI: A New Model to Transform the State” report published by the Tony Blair institute only a few weeks ago on the potential economic benefits to the UK, and the need to secure necessary computing power as a sovereign resource, one wonders what his opinion on the matter would be and if he’d agree with his old party’s direction on this?

“As for how this will affect the UK’s Tech startups, it’s currently unclear, but as 22% of the UK’s tech startups are currently in the Artificial Intelligence and Machine Learning space, up from 12% in 2019 (Figures provided by HSBC), we need to ensue we don’t stifle both academic research and innovation at once if we wish to remain one of the world leaders in AI. This is of critical importance.

“Despite the initial reactions to this news, it’s clear that the Labour government still has investment in mind when it comes to AI, so until the outputs of the AI Opportunities Action Plan are made public, it’s difficult to say too much, and we shouldn’t be too despondent. There’s a fine balancing act in play between fiscal constraints and our long-term strategic goals as a nation, and the UK will have to see a return on any investments made.”
 

Kevin Cochrane, CMO, Vultr

 

 
“The headline, UK scraps £1.3bn in AI funding, is eye-catching because naturally, it leaves one wondering how the UK can possibly lead the way on AI if it’s not willing to invest in the technology. The devil here is in the detail and there is still phenomenal opportunity for the UK in this arena.

“AI, as a technology, is maturing at a rate of knots. The opportunities for the technology today are not where they were 12 months ago, and they won’t be in the same place in five years’ time. This announcement gives the UK the chance to refocus, look at the long-term potential of the technology, its impact on businesses, and how to position the nation so that it reaps all the benefits this technology can provide.

“The UK has the distinct advantage now of seeing what’s working around the world. The EU’s AI Act was published this week and is a laudable attempt to establish a comprehensive set of guardrails to prompt safe usage and development. It was a world-leading effort, however, because it was the first of its kind there are undoubtedly areas that can be improved upon. This gives the UK an idea of what parts of that approach will work here, and what won’t.

“We’re already seeing some early signs of this with the AI Opportunities Action Plan. A crucially important, yet less discussed, consideration is access to the technology and the infrastructure that supports it. The plan’s specific ambition to improve access for startups and scaleups is vitally important, and this area of focus could differentiate the UK’s AI industry from the rest of the world.

“Ensuring businesses of all sizes have the freedom to experiment with and implement the AI-powered tools that work for them can unlock massive gains in productivity, efficiency and innovation. Unfortunately, this isn’t always possible with how the market is currently set up.

“Finding the right balance between fostering innovation and maintaining sensible regulatory boundaries isn’t easy, in fact, it’s a massive hurdle that every nation on the planet is grappling with. Today’s announcement may seem like a step backwards, but as I’m sure Team GB’s Tade Ojora and Alastair Chalmers will attest, sometimes that extra run-up is needed to clear a tall hurdle.”
 

Chris Black, AI Evangelist, Vizrt

 

 
“I hesitate to rush to judgment on this decision. At first glance, it’s clear the Labour government was always going to face tough choices in meeting budget requirements. Cutting funding to promised but unfunded programs is an obvious first step. However, even a cursory look at these particular programs reveals their crucial importance to the UK’s burgeoning AI development industry. If the UK is to maintain a competitive edge over the EU, US, India, and other nations heavily investing in AI, it must support domestic programs that underpin education and research.”