CIOTech Outlook Team | Tuesday, 22 July 2025, 09:17 IST
The United Kingdom has struck a partnership with OpenAI as part of the Labour government's ambition to attract investment and modernize public services with AI. The non-binding memorandum of understanding maps out OpenAI's interest in looking into investments within the UK in terms of data centres and workforce but the UK government will commit to consider using OpenAI's technologies in its own services around justice, defence, security and education, possibly including public data for AI-based digital services.
This comes as part of Britain's broader ambition to be a significant player in the global AI ecosystem. It is worth noting that the UK has some of the best AI research Labs such as Google DeepMind but pales into insignificance in comparison to the USA and China around private AI investment. The 2025 AI Index Report from Stanford shows that the UK attracted $4.5 billion in AI investment last year, while the US garnered $109.1 billion and China $9.3 billion.
In January, as part of its AI strategy, the government launched an "AI opportunities action plan" that included £2 billion in funding, as well as the establishment of "AI growth zones," to support alternative economic and infrastructure activity. OpenAI CEO Sam Altman taken the opportunity to praise the UK for being a leader in the early observation of AI "possibility." He indicated this partnership was now an opportunity to turn those possibilities into realities: job creation and enhanced services.
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Digital Secretary Peter Kyle took the opportunity to emphasize that the agreement would generate high-value technology jobs and infrastructure investment. He claimed this agreement also allowed the UK to play its part as a leader globally to serve as a guide in the evolution of AI. In addition to the work with OpenAI, the UK has inked similar agreements with AI companies Anthropic and Cohere, both of whom have committed to support the public sector in digital transformation of their public service functions and objectives.
Currently, Anthropic’s models are aidng citizen engagement via a smartphone app developed by the government, while Cohere’s technology will be leveraged as needed with a specific emphasis on defence. OpenAI also committed to sharing information on model capabilities and risks with the UK's AI Safety Institute. Its AI assistant, Humphrey, powered by OpenAI’s models, is being used to assist civil servants with administrative tasks and filtering responses from the public on consultations.
