Government announces UK AI hardware plan

On June 8th, as part of a series of announcements during London Tech Week and at the Government’s AI Adoption Summit, the government has launched a £1.1bn “UK AI Hardware Plan”, which aims to secure UK future capabilities across semiconductors, compute and AI. You can read the full plan on gov.uk here.

Where is this coming from?

In January 2025, the Government's AI Opportunities Action Plan set out 50 recommendations to strengthen the UK's global competitiveness in AI development and adoption, which included investment commitments into the foundations of AI: skills, compute infrastructure and regulatory clarity. In July 2025, building on the AI Opportunities Action Plan, the government published its Compute Roadmap as part of a broader ambition to strengthen the UK’s AI and compute capabilities. This commitment was reinforced in the Spending Review, alongside up to £2 billion in funding. The Roadmap recognises that access to advanced compute infrastructure is foundational to AI development, research competitiveness, and national resilience.

The AI Hardware plan builds upon that work, with a particular focus on the semiconductor hardware on which AI runs. Semiconductors are one of the fastest-growing segments of the global economy, and AI is now the single biggest driver of demand within it.

The Plan's goal is to secure Britain's future AI and chip capabilities, through establishing the UK as a leading place to develop, demonstrate, deploy and scale next-generation AI hardware.

techUK reaction

techUK welcomes the focuses outlined in the AI Hardware Plan, as we have long argued that an increased scale of support is needed to ensure the UK is a leader in the global semiconductor supply chain.

techUK believes the UK has significant strengths across semiconductor design, research, advanced packaging and startup creation, and this package brings together several of the ingredients that can be used to turn those strengths into long-term economic advantage. In particular, the combination of demand-side support through innovation funding, patient capital via the British Business Bank, and investment in skills represents a comprehensive approach to supporting the sector.

On skills, the ambition needs to be measurable and sustained across the full career lifecycle. Early intervention matters most, and the sector also has more lateral entry points than it typically communicates. Panellists at techUK's recent event on Making the Case for Semiconductors, referenced US fabrication facilities recruiting employees comfortable working under magnification for long periods, and experience in precise, controlled environments, with previous careers as dental and beauty technicians, life science lab workers, and people with fine motor skills.

Our November 2025 roundtable session on increasing women in the sector also explored retention. Retention is at least as important as recruitment, and the secondary school drop-off where girls disengage remains an under addressed problem with real economic consequences. The plans focus across the breadth of the career lifecycle is warmly welcomed, and we look forward to supporting government where possible to achieving a stronger, more diverse talent pool for the UK semiconductor sector

The opportunity now lies in delivery. Key questions will be whether procurement processes create genuine opportunities for the British semiconductor sector, whether the new skills programmes translate into a sustainable talent pipeline, and whether support reaches the firms that need it most. techUK and our members look forward to working closely with government to ensure the ambition set out in the AI Hardware Plan translates into lasting capability and growth across the UK's semiconductor and AI hardware ecosystem.

Next steps

techUK will discuss this announcement further, as well as its implications and next steps at our Chips Coalition meeting. This free open forum is for those interested in the UK semiconductor sector to discuss political learnings, provide industry updates and upcoming opportunities, as well as shape our joint advocacy. Our next Chips Coalition is taking place on July 7th, 11am-12pm, fully online. If you would like the invite, please contact [email protected]

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