Spring Budget 2023 - What does it mean for AI?

techUK has summarised the key AI announcements in the 2023 Spring Budget.

The Chancellor’s Spring Budget placed science and technology at the heart of the UK’s plan for economic growth, with a particular focus on Artificial Intelligence (AI). 

During his speech in the House of Commons, the Chancellor emphasised that ‘the UK hosts one-third of all AI European companies’, and that ‘ChatGPT and the announcement of Google Bard, have shown the powerful potential for technologies which are based upon foundation models, including large language models’. This recognition of the cutting-edge AI innovation taking place in the UK, paired with the policy announcements outlined below, highlights the significant role AI technology will continue to play in the UK’s plan for growth.

As part of the Spring Budget, Hunt accepted all the recommendations presented in the Sir Patrick Vallance review on emerging technologies, including: 

The launch of a multi-regulator AI sandbox 

Government will engage regulators, including the Digital Regulation Cooperation Forum (DRCF), to prepare for the launch of a multi-regulator AI sandbox within the next six months. The aim is to create a new, more efficient approach to helping innovators experiment with new products and services under enhanced regulatory supervision. The intention behind the multi-regulator approach is to enable greater cross-regulatory coordination and collaboration across areas where regulatory uncertainty currently exists. For this initiative to be successful, the Digital Regulatory Cooperation Forum (DRCF) will require greater capacity and resourcing to play an effective convening role and bring in other relevant regulators. 

More detail is expected to be provided alongside the launch of the AI White Paper in the coming weeks. 

Reaching a clear policy position on the relationship between intellectual property law and generative AI 

The Sir Patrick Vallance review has asked the Intellectual Property Office (IPO) to provide clarity on IP rules regarding generative AI so companies can access the material they need. The Intellectual Property Office will produce a code of practice by the summer which will provide guidance to support AI firms to access copyrighted work as an input to their models, whilst ensuring there are protections (e.g., labelling) on generated output to support right holders of copyrighted work. 

To inform the code of practice, the IPO will convene a group of AI firms and rights holders to identify barriers faced by users of data mining techniques when accessing copyright materials. According to HMG’s response to the Vallance Review, an AI firm which commits to the code of practice can expect to be able to have a reasonable licence offered by a rights holder in return. 

As part of the Budget, the Chancellor also announced: 

Exascale supercomputer and Artificial Intelligence Research Resource 

Following the recommendations in the Independent Future of Compute Review, £900m will be invested to establish a new AI Research Resource and to develop an exascale supercomputer, with initial investments starting this year. These investments will provide scientists with access to cutting-edge computing power and bring a significant uplift in computing capacity to the AI community. techUK played a key role in supporting the Future of Compute review and strongly welcomes this funding being delivered. 

AI Challenge Prize 

The Government has announced it would award a £1 million prize for ground-breaking AI research every year and for the next ten years for ground-breaking AI research. The new national AI award will be called ‘the Manchester Prize’ as the first world’s first stored-programme computer was created in the city in 1948. 

Funding for quantum computing 

The Quantum Strategy has been published alongside the Budget and commits to a ten-year £2.5 billion quantum research and innovation programme. techUK has long campaigned for the Government to commit to UK quantum leadership and the announcement of this strategy is welcome news to techUK members and the UK quantum sector. 

AI Foundation Models Taskforce  

As mentioned in the Integrated Review Refresh published on Monday, the Government is establishing an AI Foundation Models Taskforce to advance UK sovereign capability in foundation models, including Large Language Models (LLMs). The taskforce will be providing direct advice to ministers, to ensure that the UK is at the forefront of this technology. 

techUK now awaits the imminent publication of the UK AI White Paper to see how the Government’s announcements will translate into practice and provide a more detailed plan for how the UK will maintain its global AI superpower status. techUK stands ready to continue to work alongside government to ensure that the benefits of this powerful technology are felt across both society and the economy.

techUK is also organising an AI week between April 17-21 to talk about the latest developments of the technology – contribute here! 


Katherine Holden

Katherine Holden

Associate Director, Data Analytics, AI and Digital ID, techUK


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