£2.9 billion drives expansion
British artificial intelligence companies attracted a record £2.9 billion of private investment last year, new government figures reveal.
This news came as ministers pitch the UK as a global hub for AI innovation and trust.
The average deal value of £5.9 million has doubled the sector’s contribution to the economy to £11.8 billion, with more than 86,000 people now employed in AI roles across the country.
The growth is not confined to London and the South East. Data shows the number of AI firms in the Midlands, Yorkshire, Wales and the North West has at least doubled in just three years.
Pitching Britain as a magnet
In a keynote address at Mansion House, Technology Secretary Peter Kyle urged investors and regulators to match the Government’s ambition by “keeping AI companies listing, scaling, and building here.”
“We have learned the lesson of history,” Kyle told the audience of city bosses and tech leaders. “Countries prosper only if they get the big calls right – to innovate not imitate. In these uncertain times, that’s what it takes to secure a competitive edge.”
The Government points to reforms already under way: slashing red tape, funding new data infrastructure, and attracting global talent. Ministers say these steps, combined with targeted investment, will ensure Britain remains a leader within NATO and globally in trusted technology.
Building trust through assurance
Public confidence is seen as key to unlocking AI’s full potential. Ministers announced a new AI assurance industry to ensure systems are independently checked for safety, fairness and reliability.
The initiative will include:
- Establishing a professional code of ethics.
- Creating a certification scheme for AI assurance professionals.
- Launching an £11 million AI Assurance Innovation Fund in Spring 2026.
This, the Government says, will allow AI systems to be tested without “developers marking their own homework,” while giving businesses and the public confidence in adoption.
Chancellor Rachel Reeves said the reforms would underpin long-term growth: “This government is slashing burdensome red tape and making the conditions for record investment in AI, so that once again the UK can lead the way. By giving companies the right environment to innovate, grow and create jobs, we are delivering economic growth that puts more money in working people’s pockets.”
Regulators to speed innovation
An additional £2.7 million will support regulators such as Ofgem, the Civil Aviation Authority, and the Office for Nuclear Regulation to deploy AI tools that accelerate approvals and improve safety. These range from expediting clean energy projects to analysing air safety data and managing nuclear waste.
Industry reaction
Sharron Gunn, Chief Executive of BCS, the Chartered Institute for IT, welcomed the creation of an assurance profession: “This is a huge step forward. It will grow this emerging market at the pace we need and build public confidence that the people working on AI systems are responsible and trustworthy.”
With record investment, a growing regional footprint, and a new framework for trusted AI, ministers argue Britain is positioned to become a global magnet for artificial intelligence innovation – marrying economic growth with public trust.
