# Domestic AI firms offered £100m opportunity to help improve public services > Source: > Published: 2026-09-04 01:01:00+00:00 ##### Government’s new Sovereign AI unit has opened the bidding process for the new competitive initiative in which UK startups can put forward techie ideas to meet defined public sector challenges The government has launched the first procurement competitions under its £100m Sovereign AI R&D Procurement Scheme, with the aim of boosting the impact of artificial intelligence on public services and businesses. UK-based firms will be able to compete for the opportunity to develop solutions for selected public sector challenges. The first four of these include: improving NHS productivity; developing the efficiency of AI computing infrastructure; integrating AI across defence mission environments; and helping organisations to manage and mitigate AI risks. The Department of Health and Social Care will be involved, as will the newly created Department for Business, Innovation, Science and Trade, the Ministry of Defence and the National Cyber Security Centre. ### Related content [Government’s £500m Sovereign AI venture capital unit opens doors today to invest in UK tech firms](https://www.publictechnology.net/2026/04/16/business-and-industry/governments-500m-sovereign-ai-venture-capital-unit-opens-doors-today-to-invest-in-uk-tech-firms/)[MoJ first to take advantage of OpenAI UK sovereign data offer](https://www.publictechnology.net/2025/10/27/public-order-justice-and-rights/moj-first-to-take-advantage-of-openai-uk-sovereign-data-offer/)[‘AI can reindustrialise areas where deindustrialisation hurt most’](https://www.publictechnology.net/2026/04/15/business-and-industry/ai-can-reindustrialise-areas-where-deindustrialisation-hurt-most/) The government said the competitions will focus on tech that has “moved beyond early research but needs the opportunity, funding and environment to prove what it can do”. Successful firms will develop demonstrator-stage technologies with the potential to scale across the public sector and beyond. They will also retain their intellectual property. Further challenges are expected to be launched as the programme expands. AI minister Kanishka Narayan said: “When we said that Sovereign AI would put the heft of a nation behind Britain’s AI founders, we meant it. Every year the British state spends billions procuring products and solutions tackling some of the most important challenges facing society, from health to our national defence. This first-of-its-kind scheme will open up these opportunities to the British AI innovators whose ideas could make the biggest difference, backing their businesses to grow here, and go on to win globally.” The move follows the establishment of the AI Economics Institute, which the government claims is the first state-backed institute of its kind in the world. The body is intended to strengthen the understanding of AI’s economic impact, helping ensure policymakers have the evidence needed to maximise AI’s opportunities and respond to its challenges. *A version of this story originally appeared on PublicTechnology sister publication Holyrood*