UK Government announces billions in AI investment ahead of Budget

Editorial

This content has been selected, created and edited by the Finextra editorial team based upon its relevance and interest to our community.

AI has been prioritised as a driver of growth across the UK as international companies such as Graphcore, AI Pathfinder, Perplexity AI, and Cursor are investing in UK AI infrastructure. £24.25 billion in private investment has been poured into the country in the last month.

This announcement comes one week before Chancellor Rachel Reeves delivers the Autumn Budget on 26 November.

An AI Growth Zone will be established in South Wales, with companies such as Microsoft and Vantage Data Centers contributing to the £10 billion investment set to unlock 5,000 jobs. Vantage Data Centers will be working with universities in South Wales to nurture AI talent.

Chancellor Rachel Reeves said: “Today’s confirmation of our fourth AI Growth Zone is our Plan for Change in action – creating thousands of jobs and unlocking new investment for local communities in the industries of the future, cementing our position as Europe’s leading tech sector.”

The Government is allocating £5 million for each of the four AI Growth Zones that were announced in January as part of the AI Opportunities Action Plan.

AI growth will be fueled through the Sovereign AI Unit backed by £500 million in investments to fund scale-ups throughout the country, to be chaired by venture capitalist James Wise.

The Government pledged its support to invest in UK startups building AI hardware.

The announcement follows NVIDIA’s £2 billion investment in the UK AI innovation in September.

Secretary of State for Science, Innovation, and Technology, Liz Kendall said: “The backing by international investors today is a vote of confidence in the UK – and we’re determined to do even more to ensure we are backing British businesses, workers and researchers to benefit from the opportunities AI brings. This is about bringing jobs, opportunities and hope to the people and places that need it most, delivering on our promise of change.”

£137 million in government funding has also been allocated for “AI supercharges” in science and technology to drive research in drugs and treatments.