Investment in British artificial intelligence (AI) companies surged to a record £2.9 billion last year, cementing the UK’s position as a global hub for cutting-edge technology and innovation.
New figures show the UK now ranks second only to the United States in attracting AI investment, ahead of both China and the rest of Europe. The milestone underlines Britain’s emergence as one of the most attractive destinations worldwide for AI growth and commercialisation.
The Government said the investment reflected growing confidence in the UK’s tech ecosystem, and pledged to continue supporting AI scale-ups with access to talent, deeper links between academia and industry, and a regulatory environment designed to drive further expansion.
Technology Secretary Peter Kyle has outlined new plans to strengthen the UK’s sovereign AI capabilities, creating opportunities for innovation while prioritising public trust in the technology. More industries, from energy to financial services, are primed to adopt AI to boost productivity and economic growth.
A new AI assurance roadmap, launched on 3 September 2025, will underpin the UK’s strategy. It includes the development of a professional code of ethics, a skills and competencies framework, and a recertification scheme to guarantee AI systems are trustworthy, transparent and reliable. Officials said the initiative could add billions to the economy and create thousands of high-skilled jobs.
Stuart Harvey, CEO of Datactics, welcomed the surge in investment but warned that poor data quality could undermine progress: “AI systems are only as good as the data they’re built on. Without clear data quality, structure and governance, investment risks being poured into systems that are opaque, biased, or unfit for purpose. Establishing clear data readiness frameworks is key to successful AI deployment.”
Chris Davison, CEO of NavLive, said capital alone would not secure long-term impact: “Without access to top talent, supportive AI regulation and meaningful R&D incentives, funding alone won’t be enough to sustain growth or secure the UK’s place in the global AI race. The challenge now is to build the right conditions for innovation to thrive.”
To accelerate adoption across critical industries, the Government has also launched an £11 million AI Assurance Innovation Fund to develop new tools, and pledged £2.7 million to strengthen regulator capability in AI. Officials say the funding will help cut regulatory burdens, enabling sectors such as energy, aviation and nuclear to adopt AI more quickly and safely.
Investment in UK AI has more than doubled over the past five years, with strong backing for companies working in healthcare, finance, and climate tech. The rapid expansion is already contributing to economic prosperity and is expected to play a pivotal role in shaping the future of Britain’s digital economy.
With record levels of funding, a growing global reputation, and a regulatory framework designed to boost public trust, the UK is now firmly positioned as one of the world’s leading AI powerhouses.
