UKAI Quoted on the BBC
UKAI Quoted on the BBC Commenting on the AI Action Plan UKAI’s CEO was quoted by the BBC. Tim Flagg welcomed the Action Plan, but highlighted that it was very narrow in scope and pointed out that the AI sector is made up of many different types of business beyond just tech-businesses. Read the Article
How do we evaluate the AI Opportunities Action Plan?
How do we evaluate the AI Opportunities Action Plan? The UK Government has announced that the AI Opportunities Action Plan is coming, and when it arrives I am sure that there will be a lot of opinions on whether it is good, or bad and on what it misses, and hopefully what it gets right. Over the last few months UKAI has been talking to members, businesses across the UK in the AI sector, to understand what they care about most. These have been distilled down into 5 Policy Pillars. UKAI can now measure the Action Plan against these 5 Policy Pillars in our Evaluation Scorecard. This gives us a way to quantify the plan, comparing it with previous and future policies, and measuring how effective it is at supporting UK businesses in the AI Sector. We’re confident that there will be a lot of great actionable ideas. Our optimism is because the plan was authored by Matt Clifford, a successful, well known and well connected entrepreneur. Clifford understands the realities of running businesses. In addition, Clifford and the department have spoken to many businesses across the AI sector. UKAI was formed to provide a voice into the Government for the AI sector and to help the Government implement its AI policies and plans, so for us the Action Plan is fundamental. It should be the linchpin that brings Government and Businesses together with Academia and Investors in a plan that can not only drive economic growth but also social progress, across communities across the UK. We hope our optimism will not be misplaced. We are here to support the Government, through our membership, to deliver this plan but we will also highlight any areas where our members feel the plan falls short. Watch this space.
Regulating AI in the UK – Report Published
UKAI publishes the ‘Regulating AI in the UK’ report UKAI has issued a bold call to government for the artificial intelligence economy in the UK, urging immediate regulatory clarity to secure the UK’s position as a global leader in AI innovation. As the UK’s only AI trade association representing the whole AI economy, a new report warns that ambiguity around AI regulations is eroding business confidence, stifling investment, and holding back transformative services for customers across the UK. In a high-profile roundtable at the House of Lords, UKAI convened an influential mix of leaders from tech giants, startups, consumer brands, academia, and investors to chart a path for AI’s role in economic growth and social progress. The discussions revealed an urgent need for a regulatory framework that blends innovation-friendly policies with robust safeguards, striking a balance between the EU’s stringent rules and the US’s laissez-faire approach. “Burdening the AI sector with overregulation, underinvestment, or fear of the unknown isn’t just a missed opportunity – it’s a direct threat to Britain’s competitiveness on the global stage,” said Matt Warman, former AI Minister and UKAI Advisory Board member. The report, “Regulating AI in the UK,” outlines a vision for the UK to become the gold standard in AI regulation, with recommendations that include: AI Regulation Inquiry: A comprehensive investigation into the rapidly evolving AI landscape, emerging international policies, and the specific needs of UK businesses. Dedicated AI Governance: Suggestions include creating a standalone AI regulator, issuing clear guidance for SMEs, and appointing AI Officers (AIOs) to streamline governance. Ethical Seal of Approval: An industry-wide certification akin to B-Corp for companies adopting transparent, diverse, and inclusive AI practices. Educational Partnerships: Working with universities to create regulatory sandboxes and embedding AI-related technical and ethical training into education from an early age. As the Government prepares its long-awaited AI Opportunities Action Plan and the forthcoming AI Bill, UKAI positions itself as a key partner in shaping a forward-thinking, pragmatic regulatory framework. For industry insiders, academics, and policymakers, this report is more than a roadmap – it’s a rallying cry for Britain to seize the AI moment and establish itself as a beacon of global best practice. The full 30-page report, available to UKAI members, details actionable insights to ensure the UK’s AI sector thrives in a way that is fair, ethical, and economically impactful.
Does this Budget Unlock the UK’s Opportunity to Lead in AI?
“Overall, we welcome the £20 billion investment in the ‘growth industries of the future’ and the increased investment in education and apprenticeships, but it was disappointing not to have more detail about how this investment will support the Government’s AI Opportunities Action Plan. Regional investment is vital to put the AI sector at the heart of the future economic growth and social progress of the UK, but there was surprisingly little new investment in regional clusters, developing the physical and social infrastructure that is required.” Tim Flagg, COO, UKAI The UK is a global leader in AI, but we’re at a crossroads. Today’s budget set out the Government’s economic plan. As the voice of the AI sector, UKAI champions pro-AI, pro-business policies. We’ve analysed the budget and its impact on the AI sector. [UKAI members can schedule a full budget briefing]. 1. Economic Growth: Supporting SMEs The minimum wage for over 21s, known as the National Living Wage, will increase by 6.7% to £12.21 from April 2025. Employer’s National Insurance will increase from 13.8% to 15% from April 2025 and this will become payable at the lower threshold of £5,000 (previously £9,100). Many smaller businesses can claim the Employment Allowance on National Insurance, which the Government is increasing from £5,000 to £10,500. They estimate this means 865,000 small business employers won’t pay any national insurance at all, and one million are expected to pay the same as they did previously. What this means for the AI Sector Whilst the Government has tried to offset the increase of Employer’s National Insurance with the Employment Allowance, the increase in minimum wage will still be an additional cost to smaller AI businesses. The net result is making ‘offshoring’ more attractive for cash-strapped businesses that need additional resources to grow. 2. Skills & Education £6.7bn extra investment in schools. £300m extra for further education. Increase in the minimum wage for apprentices from £6.40 to £7.55. What this means the AI Sector There was very little detail in this Budget on where and how this investment will be allocated. This could be a valuable investment in the future talent that the country needs, particularly if there is a focus on the mathematical and technical skills required by our sector. The increase in minimum wage for apprentices is also welcomed: AI and technology specific apprenticeships are an important way to develop future talent with up-to-date skills. 3. Regional Development Greater control to regional mayors with ‘Integrated Settlements’ for Greater Manchester and the West Midlands. Allocation of funding (part of the £20bn for Innovation) to extend the Innovation Accelerators in West Midlands, Glasgow and Manchester. £500m to improve broadband connectivity across the country. What this means the AI Sector This signals the Government’s intent to see greater regional development. However, it was rather lacking in ambition and scope. We expected to see greater focus on building regional clusters around technology hubs, attracting further private sector investment and creating greater physical and social infrastructure, across more regions. 4. Innovation £20bn for the Growth Industries of the Future. Including £6.1bn for Engineering, Biotechnology and Medical Science Research England and £500m for Life Sciences. What this means the AI Sector It’s still quite unclear what will be included in this £20bn investment and how it will be allocated across different industries. Hopefully a significant proportion of this will be directed to the AI sector, beyond those in the Biotechnology and Medical Science sectors. 5. Investment Lower rate of Capital Gains Tax to increase by 80% (10% to 18%). Higher rate to increase by 20% (20% to 24%). Tax on carried interest, affecting private equity investors, will increase from 28% to 32% in April. What this means the AI Sector This will have an impact on both the angel investors and venture capitalists that fund many high growth businesses, potentially reducing their appetite for investment. These increased taxes will also be a consideration for business founders. Many scaling businesses have also indicated that this tax increase will make UK businesses less attractive when trying to attract senior global talent, because it will effectively mean that their stock-options are now worth less. 6. Absence of AI Industrial Strategy The Government has previously talked about putting AI at heart of its economic plans, so it was disappointing that there was a noticeable absence of AI specific investment, or the Government’s AI Opportunities Action Plan. We hope that further detail will be forthcoming on the £20bn investment in the ‘Growth Industries of the Future’, which will provide further clarity.
The UK government will launch The Regulatory Innovation Office to curb red tape and speed up public access to innovative solutions, based on emerging technology.
The UK government will launch The Regulatory Innovation Office to curb red tape and speed up public access to innovative solutions, based on emerging technology. Creating new legislation is one of the key levers that governments have to deliver their strategic plans. Whilst there are a number of different types of new legislation, businesses are often concerned when they hear about new regulations. The General Data Protection Regulation was a case in point as it required businesses to comply with a dizzying list of new regulations. Whilst larger businesses were able to hire teams of lawyers to advise them on GDPR compliance, smaller businesses struggled. SMEs have less money, less time and fewer resources and new legislation can cause significant friction, draining those precious resources and hindering growth. So, the government’s move to set up RIO is a welcomed move. It signals an understanding of the impact of current regulations and hints at a better appreciation of the need to create regulations that work for technology businesses. This requires regulation that is designed around the specifics of individual industry sectors (such as life sciences) or more broadly designed for the rapid evolution of emerging technologies. Setting up an office specifically for this purpose indicates not just the right direction of travel, but a deeper understanding of how technology businesses operate. For now RIO is focused on four industry sectors: Engineering biology, space, AI and digital in healthcare and autonomous technology. Hopefully, if it is successful the same process can be extended to cover more industry sectors. RIO has 3 important aims: To coordinate existing regulators more effectively, to identify regulations that act as barriers to business growth and then to propose updates, with input from businesses. But the real business benefit is providing certainty. Businesses are by nature ‘glass-half-full’ but they view regulations as major risks, with the potential for significant impact. Although much of the detail is missing, this initial announcement indicates that the government is using its resources to mitigate that risk.
The new government’s plan puts AI at the heart of UK economic growth
The new government’s plan puts AI at the heart of UK economic growth Yesterday, I had the privilege of meeting Feryal Clark MP, Parliamentary Under-Secretary of State for AI and Digital Government, to hear about the Government’s plans to put AI at the heart of economic growth in the UK. It was also an opportunity to raise some of the concerns that businesses have around the Government’s plans. Firstly, the Minister and her team were very impressive. They were keen to engage and they clearly recognise the importance of collaborating with businesses to find and implement the best solutions. They were happy to give credit to the previous Government for building the foundations, but it’s clear their plan is more ambitious and positive. The AI Opportunities Action Plan is now expected to be published in October. From our discussion, it sounds like this will be comprehensive and action oriented. We discussed a number of topics, but there were four key themes: Regulation: The concern of the group was that any new AI regulation should not stifle innovation, nor limit growth in a quagmire of red tape and compliance which disproportionately affect SMEs (e.g. GDPR). We highlighted the opportunity for the UK to position itself strategically between the EU and the US, also leveraging London’s dominant financial position, to reinforce the UK as a bridgehead into the EU, EMEA and other markets. Skills: Training and the provision of skills is essential to ensure that the benefits of AI are more fully ‘diffused’ across society. We talked about the difference between the technical skills required, alongside ensuring everyday people have the confidence to use AI tools to augment their daily tasks. Both are important for businesses, the former to build the software, the latter as consumers for the finished services. We need to make it easier for UK AI businesses to access and retain the best global talent, whilst also leveraging the UK’s unique assets in AI to retain our international competitiveness and open up more markets. Regional Development: Several members of the group wanted to understand how the Government planned to devolve AI outside of London. Several ideas were shared around partnerships with leading universities, building specialist centres of excellence and creating AI hubs around the new regional data centres. Government as a Customer: Ideas from the group ranged from using AI to increase speed of healthcare diagnosis, to transforming the planning processes. The Government seemed very receptive to discovering and scaling ideas, and working with innovative AI businesses to discover new solutions. For the Government to be engaging with, and using AI, improves the perception of AI, positioning it as a force for economic and social progress. The most important thing that the Government can do is to highlight the enormous opportunities, and build a more positive perception of AI across the UK. The previous Government brought together world leaders to talk about the threats: whilst important, this has only added to public anxiety around AI. Therefore, it was great to hear the new Government talk around the importance of building public trust in AI. The forthcoming AI Opportunities Action Plan sounds like it will provide a detailed roadmap and the Government seems open to ongoing feedback from the AI industry to deliver this roadmap. It is clear that businesses have an essential role to play and that the Government wants to hear ideas, feedback and solutions. This could be the beginning of something great.
