UK Prime Minister Starmer's AI Vision: Ambitious Plans and Economic Challenges

Cringing before the tech giants is no way to make Britain an AI superpower | John Naughton

To realise his dream for economic growth, Keir Starmer must seize the reins of technological power Sir Keir Starmer doesn't do visions. But last Monday he broke the habit of a lifetime in a speech delivered at University College London. It was about AI, which he sees as "the defining opportunity of our generation". The UK, he declared "is the nation of Babbage, Lovelace and Turing", not to mention the country "that gave birth to the modern computer and the world wide web. So mark my words - Britain will be one of the great AI superpowers." Stirring stuff, eh. Within days of taking office, the PM had invited Matt Clifford, a smart tech bro from central casting, to think about "how we seize the opportunities of AI". Clifford came up with a 50-point AI Opportunities Action Plan that Starmer accepted in its entirety, saying that he would "put the full weight of the British state" behind it. He also appointed Clifford as his AI Opportunities Adviser to oversee implementation of the plan and report directly to him. It's only a matter of time before the Sun dubs him "the UK's AI tsar". Clifford's appointment is both predictable and puzzling. Predictable because he's been hanging around government for a while: Rishi Sunak reached for him to organise the AI Safety Summit, for example, and to set up the UK's AI Safety Unit. It's puzzling because he's already made a ton of money from tech: his register of outside interests makes for quite a long scroll. Several media and tech executives told the Financial Times of their concern that Clifford - who had set up a successful investment firm with offices around the world - had been given outsized influence over policy in the AI sector. Clifford is "clearly a hugely capable person", said Damian Collins, a former Tory technology minister, "but the balance of interests being represented, and how they're being represented, is a concern". If Starmer really believes that AI is a transformative technology, then it's odd that his lead adviser has so much skin in such an important game. Collins was referring to a particularly hot topic - the routine violation of copyright by tech firms training AI models on other people's creative work without permission, acknowledgment or payment. The most recent revelation of this practice came from newly unredacted documents in a US court case indicating that the training dataset for Meta's Llama AI had included a huge database of pirated books scraped from the internet. Recommendation 24 of the plan calls for reform of the UK text- and data-mining regime. And its assertion that "the current uncertainty around intellectual property (IP) is hindering innovation and undermining our broader ambitions for AI, as well as the growth of our creative industries" has enraged many in those industries. "There is no 'uncertainty' in the UK text- and data-mining regime," says the Creative Rights in AI Coalition. "UK copyright law does not allow text and data mining for commercial purposes without a licence. The only uncertainty is around who has been using the UK's creative crown jewels as training material without permission and how they got hold of it." Much of the Clifford plan looks sensible (though expensive): building a national computing infrastructure for AI, for example; increasing research capacity in universities; training tens of thousands of new AI professionals; fostering public-private partnerships to maximise the UK's stake in "frontier" AI; and ensuring strong technical and ethical standards to oversee AI development and deployment. All of this makes a refreshing change from the vacuous bluster about "Global Britain" of the Johnson-Sunak-Truss era. The stated ambition of the plan - to position the UK "to be an AI maker, not an AI taker" - implies a frank acknowledgment that the UK has real potential in this area but is not resourced to realise that potential. Making that happen, though, means that two awkward truths need to be faced. The first is that this powerful technology is dominated by a few giant corporations, none of which is based in the UK. Their power resides not just in their resources of capital and talent but also in the vast physical infrastructures of datacentres that they own and control. This means nation states that aspire to operate in this space have to get along with them. In this respect, the British state badly needs to up its game: its current attitude to the companies is the servile cringe displayed by the technology secretary, Peter Kyle, when he said that governments needed to show a "sense of humility" and use "statecraft" when dealing with tech giants rather than using the threat of new laws to influence developments in areas such as frontier artificial intelligence. In other words, the UK should treat these outfits as nation states. Clearly, Kyle hasn't realised that appeasement is the art of being nice to a crocodile in the hope that he will eat you last. The other awkward truth is that, although AI is powerful, economists such as Nobel laureate Daron Acemoglu think that its general economic impact will be significantly smaller than tech evangelists believe, at least in the short term. Worse still, as the economist Robert Gordon used to point out, general purpose technologies take a long time to have a significant impact. The message for the prime minister is clear: becoming an "AI superpower" might take a few electoral cycles at least.

Keir Starmer is right to gamble on an AI revolution, but it might not pay out in time | Rafael Behr

The cash to match the prime minister's ambition will have to come from other budgets long before any benefits are seen Keir Starmer made two predictions at the start of his week. He said that artificial intelligence will transform Britain's economy in the coming years and that Rachel Reeves will continue to run the Treasury. Those were safe bets, but not guarantees. One is a forecast the prime minister makes eagerly, the other was bullied out of him. He would have preferred to talk about AI improving productivity, generating jobs and improving services, without being asked if he plans to sack the chancellor. He doesn't, and wouldn't say even if he did. The question isn't serious. It is a contrivance, a lobby ritual for turning speculation into news. Demand official comment on an improbable scenario, then interrogate the answer until it surrenders a headline. Starmer isn't poised to jettison Reeves, but economic pressure on the pair is real. There is no growth. The pound is depreciating and debt costs are rising, gobbling resources that can't then be used to upgrade the public realm. The chancellor has already tested the limit of how much revenue she can tap without breaking pre-election pledges not to raise taxes on "working people". Fiscal rules (self-imposed, but enforced by predatory bond traders) forbid unfunded borrowing. In the absence of a lucky windfall, the spending review in June will be brutally austere. It will demoralise Labour MPs and stir cabinet dissent. That context gave a restless urgency to the launch of the prime minister's AI action plan on Monday. The independent report that has been adopted wholesale as government policy was submitted last September. Back then, no one had Starmer down as a techno-utopian. The prime minister has a reputation as a methodical man who ponders evidence, absorbs submissions, takes his time over decisions, but then fully commits to his chosen path. People close to the discussions say he is now sincere and vigorous in the conviction that Britain must be propelled headlong into a state-sponsored AI revolution. It is a big call about the long term. Also the right one, regardless of present Treasury constraint. If you know for sure that a colossal wave is about to break on the shore, and you have time to prepare, it makes more sense to harness that force to serve your preferred ambitions than to crouch low and hope the things you care about aren't swept away. This is a significant moment in the evolution of Starmer's project in two ways. First, it channels the will of the prime minister into a specific industrial policy, from which concrete spending priorities will flow. That clarity of intent has so far been absent, feeding a sense of drift and incoherence. Second, it describes a theory of progress - a concept of how politics can improve people's lives - that isn't measured in traditional social democratic terms by the size of departmental budgets for good causes. That digital vision has been forced on the prime minister by a fiscal impasse that puts analogue tax-and-spend levers out of reach. But force majeure doesn't necessarily invalidate the insight. And it is refreshing to hear a centre-left leader talk with enthusiasm about the future, citing beneficial collective applications of technology. It's about time someone contested an intellectual space that is otherwise dominated by anti-government libertarian dogma and creepy, conspiracy-minded nationalist machismo. It is easy to list hazards and contradictions on the road to implementing the AI action plan. There are massive unanswered questions about ownership of data, copyright protection, accountability for automated decisions in public bodies, energy usage and how to mitigate its impact on the climate. It isn't clear yet what the practical difference is between a sovereign government designing its own bespoke, globally competitive regulatory framework and a desperate government pleading for foreign investment and capitulating to the demands of tech companies. But the difficulty of getting that stuff right isn't an argument for not trying, given that the alternative is to dither and end up taking whatever answers other regimes come up with first. There is a more imminent political problem. Money allocated for wiring Britain up for supercomputers and jumbo datacentres has to come from someone else's budget. The dividend from that investment won't immediately compensate the losers. The test of whether an AI-focused industrial strategy really is the key to decrypting Starmerism will be how No 10 arbitrates in those disputes; whether the cabinet can unite around the plan when Labour MPs are kicking off about cuts and voters are wondering why cyber-modelling of future potholes seems to be taking priority over filling in present ones. The prime minister might be right when he says the benefits of AI will be felt much sooner than sceptics appreciate. But the timeline doesn't map neatly on to a political cycle accelerated by voter impatience and global volatility. In the first phase of the revolution, exciting new plans for digitising the state will look suspiciously like the miserable old routine of shrinking it. Reserves of goodwill are already depleted and neither the prime minister nor the chancellor is gifted at the art of public policy evangelism. In a more benign economic setting, Starmer's speech launching the AI action plan would probably have received less attention - treated as a nerdy digression - but it could also have been judged as policy in its own terms. It might have been analysed as a declaration of strategic intent and not belittled as a symptom of frantic fishing for growth, or drenched in speculation about an embattled chancellor. It is important, interesting stuff. But it has been overburdened with political heavy-lifting because Reeves and Starmer are stuck in a fiscal trap they laid for themselves in the past and badly in need of something upbeat to say about the future.

Britain's Keir Starmer Needs to Curb His AI Enthusiasm

UK Prime Minister Keir Starmer wants the country to be a trailblazer for artificial intelligence. This makes sense in theory for a place that gave the world computing icons like Alan Turing, Ada Lovelace and Tim Berners-Lee -- but a lot of his plan doesn't. One of the UK's greatest strengths is its role as a fast, thoughtful regulator on technology, often striking a sensible middle ground between America's regulatory vacuum and the European Union's stifling bureaucracy. Starmer says Britain should be more than that, touting AI this week as a springboard for growth that could lift the UK's productivity by 1.5% and add £47 billion ($57.2 billion) to the economy. Yet the lengthy plans he sketched out for that number are vague and don't account for the fact that financial benefits of tech revolutions often take years to manifest. An intervention of this kind, which will cost £14 billion, also looks unwise as the UK faces serious public spending pressures.

Why Starmer and Reeves are pinning their hopes on AI to drive growth in UK

The PM and chancellor believe AI will help British workers produce more, raising wages and releasing spare capital The spectre of last week's bond market sell-off hangs over the government's artificial intelligence strategy. Investors, and voters, want to know where the growth is in the UK economy. Keir Starmer and the chancellor, Rachel Reeves, believes AI is a significant part of the answer. The UK has considerable strengths in AI, which can be loosely defined as computer systems performing tasks that typically require human intelligence (ranging from summarising a document to assessing a medical patient's symptoms and writing emails). Those strengths include the high-quality research and engineering talent coming out of UK universities and the fact that the country already hosts a number of leading AI companies, led by the UK-founded Google DeepMind. There are negatives, of which the government is well aware (hence the strategy): building data centres - the central nervous system of AI systems - is a laboriously difficult process in the UK; access to, and the cost of, the vast amounts of energy needed for data centres is also a problem; AI talent and companies can move elsewhere if they get frustrated; and getting regulation right, from safety to copyright, is a difficult balance to strike. "AI is not a panacea. It's not magic," says Theo Bertram, the director of the Social Market Foundation thinktank. "But if you are going to place your bets on a chance for economic growth, then this would be the best place to put it." Why is the government investing so much hope in this plan drawn up by the tech investor Matthew Clifford? Part of the answer lies in productivity: the term for how much output a worker can produce in a hour. The International Monetary Fund has predicted that AI will increase UK productivity by up to 1.5% a year. Low productivity has bedevilled the UK for years, partly due to low investment in nifty technology. AI, it is hoped, will help British workers produce more, which should raise wages and allow spare capital - you don't need so many workers to do a certain job - to be invested elsewhere. This is even more important if, with an ageing population, the UK must cope with fewer working-age adults in the future. "If we see the working-age population shrinking you need to see productivity increase dramatically in order to see any sort of economic growth," says James Knightley, chief international economist at the banking group ING. This logic also applies to the public sector, with the plan calling on state bodies to pilot AI services. Underneath all of this is the implication that efficiency - through AI automating certain tasks - means redundancies. The Tony Blair Institute (TBI) has suggested that more than 40% of tasks performed by public sector workers could be automated partly by AI and the government could bank those efficiency gains by "reducing the size of the public-sector workforce accordingly". TBI also estimates that AI could displace between 1m and 3m private-sector jobs in the UK, though it stresses the net rise in unemployment will be in the low hundreds of thousands because the technology will create new jobs, too. Worried lawyers, finance professionals, coders, graphic designers and copywriters - a handful of sectors that might be affected - will have to take that on faith. This is the flipside of improved productivity. But ensuring that the UK plays a key role in developing a transformative technology and deploying it properly across the private and public sectors requires a coordinated industrial strategy. Long-term industrial plans are complex beasts and require cooperation across multiple fields - from skills to energy infrastructure and regulatory frameworks - hence the 50 recommendations from the report that the government is committed to putting in place. They include setting up "AI growth zones" with fast-track planning privileges, launching a body to support leading domestic AI firms and improving AI-related work skills. There are also elements of the government's AI policy that will raise concerns. The plan's proposal to create national datasets composed of public data will have to jump hurdles related to privacy, ethics and data protection, while a move last month to allow AI firms to train their models on copyrighted work was rejected by the creative industries and publishers. But for Starmer and Reeves, growth is key. Dame Wendy Hall, a professor of computer science at the University of Southampton and a member of the UN's advisory body on AI, says it is "imperative" for the economy that the government makes the plan work. "It's not a question of 'can they deliver it.' They have to deliver it."

UK needs more than AI to escape its economic hole

This article is an on-site version of our Inside Politics newsletter. Subscribers can sign up here to get the newsletter delivered every weekday. If you're not a subscriber, you can still receive the newsletter free for 30 days Good morning. Rachel Reeves will remain as chancellor for the rest of the parliament, Downing Street has said. No kidding. Although Keir Starmer and his chancellor do not always agree on everything, they are aligned on the big things, not least on avoiding tax rises. Both campaigned for Remain but came relatively late to the cause of the People's Vote campaign during the 2017-19 battles over Brexit. This is more important than you might think. As Labour tries to get UK growth going, it is grappling with the question of just how bold to be when it comes to trying to reshape relations with the EU. And the government's self-denying promises to not raise income tax, national insurance or VAT were a co-creation of Starmer and Reeves. Since 1964, chancellors have only left office when they disagreed with the prime minister of the day over an essential aspect of policy or personnel (Nigel Lawson, Sajid Javid and Rishi Sunak), after an election (Geoffrey Howe), when they've died (Iain Macleod), when their boss leaves Downing Street (Roy Jenkins, Denis Healey, Anthony Barber, John Major, Kenneth Clarke, Gordon Brown, Alistair Darling, Nadhim Zahawi and Jeremy Hunt) or when a crucial aspect of their programme is in tatters (Jim Callaghan, Norman Lamont and Kwasi Kwarteng). What is worth noting about that final three is that all their parties lost the subsequent elections (1970, 1997, and 2024). But the problem for Starmer and Reeves is that it is not clear whether they or anyone in the government has a plan that will improve the UK's growth prospects and with it get the British economy and public finances out of its hole. Will embracing AI help? Some thoughts on that below. Two things that are true at the same time: Rishi Sunak's work on artificial intelligence safety was a significant achievement and one of the standouts of his premiership. Creating an international forum where states talk about this issue is a net gain for the world. But his work on AI safety was also, as people at multiple UK-based tech companies said privately at the time, a bit of a disaster for Britain. After Brexit, it is not really in the UK's primary interest to be a world leader on AI safety, both specifically and in terms of the signal it sends about the UK. That the Competition and Markets Authority took a colder view of the Microsoft/Activision merger in the same year as the launch of the AI safety summit did not exactly scream "the UK loves tech, innovation and investment". So, even before you get into the substance of what Keir Starmer is saying about AI, as a signal, a lot of what he said yesterday -- including in an op-ed for the FT -- is positive. It's true too that there are some very exciting trials of how large language models can increase productivity in the public sector by freeing up staff time and reducing the administrative burden on the state, though some of the suggestions in his speech sound very optimistic. But the government is going to need much more than positive noises on AI -- it requires a bigger and broader set of pro-growth measures, and a plausible account of how it is going to stick to its fiscal rules, too. I mostly listened to Franz Ferdinand's new album The Human Fear while writing my column this week.

Starmer aims to refocus attention on growth after hit from markets

Prime minister Sir Keir Starmer will on Monday promise to make Britain "the best state partner" for artificial intelligence companies in the world, as he tries to boost UK growth prospects against an ominous economic and political backdrop. Starmer, writing for the Financial Times, will claim Britain's "values of democracy, open commerce and the rule of law" make the UK a natural location for AI companies to invest, and vows to sweep away planning restrictions and create new "AI growth zones". "I am determined the UK will become the best place to start and scale an AI business," he writes. "I know growth in this area cannot be state-led. But it is absolutely the job of government to make sure the right conditions are in place." Starmer hopes to get back on the front-foot after a week in which his economic plans were battered by the markets, leaving chancellor Rachel Reeves potentially facing the need to cut spending or raise taxes to keep her fiscal plans on track. Reeves, who returns from a visit to China on Monday, will this week "haul in" regulators to tell them to be more ambitious in sweeping away barriers to growth. Meanwhile Starmer is facing calls from Kemi Badenoch, Tory leader, to sack his City minister Tulip Siddiq, whose position remains precarious after she became embroiled in a property scandal tied to the ousted government of Bangladesh. Last week Britain's borrowing costs climbed to close to a 16-year high against a backdrop of sticky inflation and fears that Reeves' tax raising Budget had contributed to stagnating growth. The sense of economic gloom was compounded by a survey of UK chief financial officers by Deloitte, which showed that business optimism fell to a two-year low in the fourth quarter. The survey found that a net 26 per cent of CFOs reported feeling more pessimistic about the prospects of their business than three months ago, marking the first time sentiment has tipped into negative territory since the second quarter of 2023. CFOs said that cutting costs would be their most likely response to Reeves' £25bn rise in employer national insurance contributions. Deloitte said UK corporates expected to cut capital expenditure, discretionary spending and reported the sharpest fall in hiring expectations since the pandemic. Nonetheless, the survey found that confidence is well above lows seen in 2020 and 2022. Mel Stride, shadow chancellor, told the BBC that "business confidence is falling through the floor because of actions the government has taken" and insisted Reeves should have cancelled her China visit to calm markets. But one adviser to the chancellor said: "Is he seriously saying she should have scrapped the trip to stay at home over the weekend to address a closed market? It would have rightly been seen by the markets as panic." An ally to Starmer said any suggestion that Reeves' position was under threat was "complete rubbish". Starmer continues to believe that Reeves' October Budget, which sought to stabilise public finances and shore up public services with a £40bn tax rise, will be vindicated in the long run, in spite of the market turmoil. Reeves is planning her own speech on growth, but it has been delayed until after her trip to the World Economic Forum in Davos later this month. On Thursday she will summon eight regulators to explain what they are doing to boost growth. In her Mansion House speech in November she told watchdogs: "The UK has been regulating for risk, but not regulating for growth."