Keir Starmer’s £2bn Pledge: How the UK Plans to Advance AI
UK Prime Minister Sir Keir Starmer unveiled plans at London Tech Week to scale the country’s compute power and introduce digital skills programmes for young people.
Part of this £2 billion (US$2.7bn) funding promise was a £1 billion (US$1.35bn) AI investment announcement, placing digital infrastructure at the centre of the country’s growth ambitions and recognising its essential role in unlocking job opportunities, greater innovation and long-term economic resilience.
This comes amidst the country’s desire to become a leader in AI infrastructure, having already heavily committed to growth strategies to fuel the economy. Part of these plans included confronting the planning system in the UK to speed up the delivery of new data centres to support AI innovation.
How the UK is planning to grow its data centre industry
As a whole, the UK has seen strong growth in its data centre development in recent months. This has largely been due to the facilities being classified by the country’s government as critical national infrastructure (CNI) in September 2024, thereby bringing them further into the public consciousness.
The country has been successful in attracting international investment to fuel the digital economy and boost jobs.
Across Europe, data centre demand is expected to continue booming, rising from 10GW in 2024 to roughly 35GW by 2030. AI has been cited as the critical cause of such a surge, as the technology consumes significant levels of power and energy to run.
According to projections by McKinsey, power demands will rise from the current 62 terawatt-hours (TWh) to more than 150 TWh – tripling data centre energy use by 2030.
Such a surge speaks to the critical importance of upgraded infrastructure and greater access to renewable energy alternatives.
Dame Dawn Childs, CEO of Pure Data Centres Group, says via a company LinkedIn post: “We would welcome leadership from the government to ensure power generation, transmission and connection does not impede the promise of AI and a digitised, connected society.
“Data centres can be part of the solution to ensuring we don’t have to make a choice between a digitised future and a sustainable one powered by renewable energy.”
The £2 billion is an investment into the AI Action Plan, with the UK government eager to demonstrate a commitment to sovereign AI capabilities across the country.
“Strategic investment in secure, scalable infrastructure, a skilled workforce and energy efficiency is vital to future-proofing the UK’s AI competitiveness,” says Steve Young, UK SVP and GM at Dell Technologies. “The government has taken decisive steps towards ensuring AI benefits every corner of British society.
“This announcement underscores the vital collaboration between government, industry and academia and paves the way for innovation that empowers people, strengthens communities and transforms lives.”
Inviting big tech firms like Nvidia to lead the charge
Speaking at London Tech Week alongside Keir Starmer, Nvidia co-founder and CEO Jensen Huang shared his thoughts that the UK currently lacks the digital infrastructure required to fully capitalise on AI.
In response, the CEO has offered his company’s support to help the UK build the infrastructure needed to get ahead with its AI progress. These efforts include Nvidia establishing the UK Sovereign AI Industry Forum, a group of leading UK businesses to develop and deploy AI infrastructure that aims to strengthen the country’s digital economy and security.
Companies already a part of this group include BT, National Grid and BAE Systems, among others.
Nvidia has been charging ahead with its AI and supercomputing developments in recent weeks, having announced a string of partnerships in order to bolster AI infrastructure across Europe.
With Schneider Electric in particular, announced this week, both companies are leveraging their shared experience in AI-ready infrastructure, sustainability and grid coordination to respond to the European Commission’s ‘AI Continent Action Plan’ – an initiative that outlines a shared mission to set up at least 13 AI factories across Europe, while establishing up to five AI gigafactories.
What other tech leaders are saying
David Sewell, CTO at Synechron, shares why infrastructure is vital to keep the UK competitive, explaining: “Without sufficient investment, the UK’s digital infrastructure gap will be a bottleneck for AI advancement.
“Robust infrastructure acts as the foundation that enables innovation developments, attracts global tech talent and positions companies to compete internationally.”
He adds: “AI is developing rapidly. While Starmer's £1 billion commitment is encouraging, it matters what’s beneath the headline pledge. As this technology grows it needs advanced data centres, power grids and high-speed connectivity to flourish.
For the UK to remain competitive in the global AI race, digital infrastructure must be treated as a priority by the government, businesses and investors.”
Greg Hanson, Group Vice President and Head of EMEA North at Informatica, adds: “The real challenge lies ahead. Getting ahead in AI isn’t solely about acquiring and deploying technology. It’s about cultivating a workforce with deep AI knowledge and skills.
“If the UK doesn’t have the right skillset, valuable insights will be left undiscovered and productivity gains remain elusive.
“Many organisations are in the early stages of building AI readiness and preparing their data for AI. Moving too quickly, without establishing the right foundations, skills and culture, could result in long-term setbacks rather than sustainable success.”
Joe Dunleavy, EMEA CTO at Endava, says: “Investment alone won’t move the needle. To lead in AI, industries must act now. This means closing skills gaps, modernising infrastructure and putting proper governance in place to ensure AI is used responsibly.
“It’s time to move beyond pilots and proofs of concept and start embedding AI into the heart of products and services.
This is our window to lead not just in building AI, but in showing the world how to apply it, at scale and with impact.”
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