Andy Burnham has been warned that breaking up the government department behind Britain’s artificial intelligence strategy could unsettle global investors and damage the country’s standing as a technology hub.
The incoming prime minister is reportedly considering abolishing the Department for Science, Innovation and Technology (DSIT) and splitting its responsibilities between the Department for Business and Trade and the Department for Culture, Media and Sport.
The plans have not been confirmed. Downing Street, the Cabinet Office and DSIT all declined to comment.
The prospect of an overhaul of the department has triggered a unified response from the tech sector, which has argued that Britain’s priority should be maintaining momentum in one of its fastest-growing industries – not reorganising government.
“It feels like it’s fixing something that wasn’t broken,” Brent Hoberman, founder of Founders Forum, who lobbied for the creation of a dedicated technology department before DSIT was established, told City AM.
“There’s going to need to be a great speech and some great policies to say, ‘This is why entrepreneurs will flourish in the UK’,” he said.
Investors will now be looking for a clear signal that technology remained central to Burnham’s growth plans, Hoberman added.
Britain is home to the world’s third-largest technology ecosystem and Europe’s biggest AI startup market and ministers have spent the past three years pitching the country as a global AI hub.
The new Prime Minister has pledged to spread economic growth beyond London through greater devolution and regional investment.
Hoberman backed that ambition but warned it should build on, rather than weaken, Britain’s biggest tech hub in the capital.
“Our best six-letter word is London,” he said. “Technology has to be at the heart of all of that.”
Former government AI adviser Matt Clifford, who helped shape Britain’s AI strategy, called the reported plans “a big mistake”.
“Right now is a critical moment for tech as an economic and national security issue,” he said. “Tying up our most senior science and tech officials in a reorganisation wastes time and energy that’s desperately needed for the actual substance.”
‘A big mistake’ #
DSIT was created in 2023 to bring together responsibility for AI, research, digital regulation and innovation under one secretary of state.
Since then it has overseen the AI Opportunities Action Plan, the AI Security Institute, the £500m Sovereign AI Fund and UK Research and Innovation, while acting as government’s main point of contact for the sector.
Beyond concerns of whether DSIT survives, trade bodies have warned that months of restructuring would distract ministers and civil servants just as Britain tries to cement its position against the US, China and Europe in the race to commercialise AI.
In a joint letter to Burnham, techUK and the Startup Coalition described abolishing DSIT as “the wrong change at the wrong time”, saying another machinery-of-government reshuffle would slow decision-making when businesses were looking for clarity.
Russ Shaw, founder of Global Tech Advocates, said Burnham’s plans to spread growth beyond London could strengthen regional tech clusters, provided they did not come at the expense of a coherent national strategy.
“The core priority for the UK tech ecosystem isn’t a specific political ideology, but the need for momentum,” he added.
Ian Hogarth, chair of the AI Security Institute, told City AM: “The best civil servants I’ve worked with are there to have impact. If you chew their days up with these kind of random re-orgs, the best people move on.”
Meanwhile, rumours that Burnham intends to appoint Britain’s first Cabinet-level AI minister have been welcomed by the industry.