NEWS7 March 2024

Spring Budget: Chancellor announces AI investment

AI News Public Sector UK

UK – The chancellor Jeremy Hunt has allocated more investment to artificial intelligence, including a new skills fund for businesses, as part of the government’s Spring Budget.

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The government will double the total funding of the Alan Turing Institute from £50m to £100m over five years with the aim of building on the institute’s work to use AI to help address challenges in areas such as health, sustainability and defence.

The Budget, announced yesterday ( 6th March), also included £7.4m in funding for a ‘business upskilling fund’ aimed at helping small- to medium-sized enterprises develop AI skills.

The government also said it will publish a plan later in the year to address how to manage access to the UK’s AI compute facilities, for researchers to use AI for research and development (R&D).

Stephen Woodford, chief executive, Advertising Association, said: “The Advertising Association welcomes the announcement of the PBS AI SME Upskilling Fund in today’s Budget. This is an investment of £7.4m to pilot a flexible AI upskilling fund, which will help SMEs deliver AI training to their employees.

“Our sector is already deploying AI in strategic, creative, media and production processes to unlock wider productivity gains and economic benefits. As AI becomes more embedded in our industry, it will be vital that employees can be upskilled and trained in how best to use it. We will work with government to ensure this fund enables our sector to continue to make best use of this new technology.”

The government will cut National Insurance contributions by 2p for employees, from 10% to 8%, from April 2024. 

Commenting on the Budget statement, Roger Barker, director of policy at the Institute of Directors, said: “First and foremost, business was hoping for a Budget that would maintain a stable and credible policy framework for business. The Chancellor largely delivered that. However, beyond that, there was little in the announcements that can be regarded as a game-changer for business.

“The chancellor rightly acknowledged that skills and labour shortages are a major problem for many UK enterprises. Although cuts to national insurance and boosts to child benefit provision may attract some people back into the workforce, the Budget offered little to address the economy’s deep-seated skills gaps. This was a major omission and business will be looking to a future government to urgently address this issue.

“Clearly this was a Budget aimed at rallying political support rather than addressing the UK’s longer-term economic issues. However, it fell short of a delivering a comprehensive plan for sustainable growth and investment.”