The UK government has announced a package worth more than £600 million to protect the country from AI-enabled threats and help British artificial intelligence companies grow at home rather than abroad.
Set out by HM Treasury on 24 October ahead of Chancellor John Healey’s Budget, the plan spreads funding across biological security, cyber defence, testing of advanced AI models, chip-design skills and local adoption schemes. Ministers have presented it as a distinctly British approach to AI: one that manages the risks, protects workers and spreads the gains of AI-driven growth to every part of the country.
A world-first AI Biosecurity Lab
The largest single item is £165 million for a new National AI Biosecurity Initiative. Of that, £100 million will establish the AI Biosecurity Lab (AIBL), which the Cabinet Office describes as the world’s first organisation dedicated to AI biosecurity. The remaining £65 million will strengthen biosurveillance and fund work on medical countermeasures for priority pathogens.
Two of the biggest AI developers are backing the lab. OpenAI will provide £100 million in compute and model credits, plus trusted access to relevant models through its Rosalind Biodefense programme. Anthropic will contribute up to £100 million in model credits, trusted model access and dedicated technical support. Google DeepMind and London-based Basecamp Research will join as research partners.
AIBL will run as an independent, non-profit body, set up in a similar way to the AI Security Institute so that it can move at the pace of a frontier AI company. Its first priorities are detecting emerging biological threats earlier and speeding up the development of vaccines, treatments and other countermeasures. It will work alongside the UK Health Security Agency, the Animal and Plant Health Agency and the Defence Science and Technology Laboratory, and with the medicines regulator, the MHRA, on preparing for health emergencies and regulating AI-designed medicines.
More money for cyber defence and AI testing
The package also widens the UK’s defences against digital threats:
- An extra £120 million for the AI Security Institute, which tests new AI systems and develops technical standards for managing their risks.
- £60 million for a National Cyber Shield that will use agentic AI to strengthen cyber defences. This includes a £25 million challenge fund for UK AI and cyber security firms, and early work on a regulatory sandbox for agentic security tools in critical national infrastructure, the public sector and industry.
- £70 million for a new National Exposure and Real-Time Vulnerability (NERV) Centre, which will use AI tools to find weaknesses across critical infrastructure and the wider economy.
- A new National Cyber Security Centre AI Cyber Security Centre of Excellence in Manchester to train government cyber and AI specialists.
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Backing homegrown AI
A second strand aims to reduce Britain’s reliance on technology developed overseas. The Sovereign AI Fund receives an extra £60 million to invest directly in promising UK AI companies, with a new focus on physical and industrial AI such as robotics, autonomous systems and advanced manufacturing. A further £60 million goes to the Sovereign AI R&D Procurement Scheme, which buys innovative solutions for the health and care system and for AI security and assurance.
On hardware, £18 million will set up a UK Advanced Chip Design Academy to build chip-design skills and link British research more closely with semiconductor manufacturing, with new chip-design capability to be developed in Edinburgh.
AI Minister Kanishka Narayan said: “We cannot afford to rely entirely on technology built overseas.” He argued that backing British science, advanced chips and UK AI companies would strengthen national security and create skilled jobs across the country.
Spreading the benefits
The rest of the funding targets adoption and evidence:
- £15 million for an AI Challenge Prize, with the first round aimed at firms using AI to solve health problems.
- An extra £23 million over three years for the AI Economics Institute, which studies how AI affects productivity, growth, jobs and living standards. It will also support international research during the UK’s G20 Presidency next year.
- £30 million to start local AI partnerships with Mayoral Strategic Authorities, bringing councils, businesses, universities and colleges together to help local firms, including SMEs, adopt AI and give workers new skills.
The government pointed to AI already in use in public services. In the NHS, AI is helping clinicians analyse more than 210,000 chest X-rays a month, around a third of the total, while HMRC’s Ask HMRC digital assistant handled around 6.3 million customer interactions in 2025-26.
Industry reaction
Trade body techUK welcomed the package. Its chief executive, Julian David, said it focused on the right issues and would help British AI firms grow in the UK instead of moving abroad. Ciaran Martin, the former head of the National Cyber Security Centre, said the measures came at a critical time for the country’s cyber defences.
What comes next
Attention now turns from headline figures to delivery. The Cabinet Office says further details of the AI Biosecurity Lab’s scientific advisory committee will follow, and the speed at which the new biosecurity and cyber bodies are staffed and running will decide whether the package lives up to its billing. For businesses, the £25 million cyber challenge fund, the AI Challenge Prize and the local AI partnerships are the schemes to watch for application details.
Sources: HM Treasury, “Chancellor unveils Britain’s ambitious plan for AI” (24 October 2026); Cabinet Office, “Introducing the AI Biosecurity Lab” (24 October 2026). Featured image: HM Treasury / GOV.UK, Open Government Licence v3.0.
