Industry leaders at UKAI are calling on the Chancellor to commit to dedicated Budget funding for a national sovereign AI strategy.
Britain faces the danger of becoming too dependent on foreign tech giants unless the government sets out a comprehensive strategy for its own AI capabilities, industry leaders warned the Chancellor ahead of Wednesday’s Budget.
UKAI, which represents more than 270 AI businesses, has called on John Healey to pledge major investment in national sovereign AI strategies, warning that the country could become a “vassal state” dependent on foreign powers for critical technologies.
The signing comes just days after the Treasury announced more than £600m in AI investment, including additional funding for UK startups and domestic chip design.
But the trade body stressed that the successive funding announcements did little to address the wider problem of the UK’s reliance on foreign firms for AI models, computing infrastructure and services that underpin the economy, as reported by City AM.
“The UK has some of the best AI companies in the world, but there is no Sovereign AI strategy to help them develop”, said Tim Flagg, chief executive of UKAI.
“The AI Opportunity Action Plan, the Sovereign AI Fund and the AI Hardware Plan are all welcome steps, but none of them join together. By themselves, they are building blocks. Combined as a strategy, they will be transformative”.
He warned that without swift intervention, the UK risks becoming “a vassal state, dependent on countries that control the AI infrastructure on which the economy is increasingly dependent”.
The pressure is built through the dependence of AI Britain Danger comes in the wake of significant disruption caused by the recent Google Cloud outage, which UKAI said affected banks, businesses and courts, highlighting the dangers of relying on a handful of overseas providers.
It also comes amid concerns about Britain’s vulnerability to geopolitical tensions and the dominance of American tech companies in the global AI market.
Charlotte Wilson, head of enterprise at cybersecurity firm Check Point, said governments need to look beyond individual funding commitments.
“Without a dedicated sovereign plan in place, the UK will continue to be at the mercy of overseas technology companies, experiencing damaging outages and major cyber security fears”, she said.
“The Piece funding announcement is the best tactic, and we need a detailed strategy on how the country will build and design a new wave of AI tools to support critical national infrastructure”.
Wilson said developing domestic AI capabilities should also be part of Britain’s defense spending strategy, especially as cyber threats from hostile nations continue to grow.
The call follows a warning from the government’s Science and Technology Council that the UK risks becoming a “high-value customer of AI” rather than a producer of critical technology unless ministers strengthen domestic capabilities.
The government has created a £500m Sovereign AI Fund to help UK start-ups scale, with the Treasury announcing a further £60m for the program on Saturday. A further £60m will be directed towards UK AI technology research and procurement, with £18m set aside for a new chip design academy.
The wider package includes £165m for a national AI biosecurity initiative, supported by OpenAI, Anthropic and Google DeepMind, along with £130m for AI-driven cybersecurity projects.
Healey said the investment would help provide a “distinctly British approach to AI” that safeguards the national interest while boosting economic growth.
AI Minister Kanishka Narayan also acknowledged the dangers of overseas dependence, warning that the UK cannot “rely on all technology being built overseas”.
However, UKAI is calling on the government to consolidate existing initiatives into a single strategy, supported by dedicated funding and reforms to public procurement that will give UK AI companies greater access to government contracts.
Flagg said the UK had the entrepreneurship, research and talent to compete globally, but these assets remained “fragmented and disconnected”.
“The Government can change that by uniting and championing UK AI businesses and reforming public procurement, so that taxpayers’ money builds UK growth and UK jobs”, he said. “Next week’s budget is a moment for action”.