Could government-backed chip purchases help keep Britain’s AI innovators at home? Ministers are preparing a strategy to strengthen domestic semiconductor capabilities and reduce reliance.
The UK Government is preparing a new strategy to have the public sector purchase AI-related hardware from British technology companies, as ministers seek to strengthen the domestic semiconductor sector and reduce dependence on foreign suppliers.
According to a report by The Telegraph, Technology Secretary Liz Kendall is expected to outline the proposals during London Tech Week. The initiative, described as an ‘AI hardware plan’, would use government procurement to support UK-designed semiconductor technologies and encourage emerging companies to remain based in Britain rather than relocating overseas.
The proposals come amid growing concerns about the concentration of AI infrastructure in the United States (US) and broader geopolitical uncertainties that affect access to critical technologies.
The UK government has already committed more than £1 billion towards AI computing infrastructure and plans to significantly expand the UK’s AI Research Resource.
According to draft plans, officials are considering strategic public-sector purchases of AI hardware, alongside measures to improve access to funding and develop specialist skills. Equipment acquired through the programme could support public services or be deployed within AI computing clusters available to businesses and researchers.
The strategy extends beyond AI processors to include networking technologies, sensors and power systems that support advanced computing workloads.
Britain has produced several notable semiconductor firms, including Arm, Graphcore, Alphawave and Imagination Technologies, many of which have either been sold to overseas owners or moved key operations abroad.
Newer companies such as Fractile, Olix and Lumai are developing technologies aimed at challenging the dominance of AI chip leader NVIDIA.
The government has previously invested through a £500 million AI fund, including support for infrastructure company Callosum, while the research agency ARIA is running a £100 million programme focused on reducing AI computing costs.
However, UK’s Department for Science, Innovation and Technology has not commented on the proposals.
