The UK government’s ambition to become an AI powerhouse is undermined by a strategy that prioritises spending with US tech giants over investing in domestic companies, according to director of consultancy Posetiv and Green Ops advocate, Mark Butcher.
Butcher was speaking at a recent event hosted by tech firm HPE, focused on the UK AI opportunity.
Speaking on government AI policy, Butcher argued that successive strategies have funnelled billions of pounds to American hyperscalers through long-term contracts, while offering little direct support to UK technology firms.
“We talk about investment, but what we’ve actually agreed to do is hand £10-20 billion to US companies with no meaningful controls,” he said.
Butcher criticised the creation of government-backed “AI growth zones”, warning they risk becoming redundant if the public sector itself is locked into five- to ten-year deals with global cloud providers.
“If the government isn’t willing to buy from the growth zones it’s promoting, there won’t be any real demand,” he said.
He also raised concerns about economic resilience and skills, arguing that reliance on foreign platforms weakens the UK’s tax base and future jobs market. With enterprises cutting internships and graduate recruitment, Butcher said claims about AI-driven job creation “don’t exist in reality”.
“The solution is simple,” he added. “Spend with UK companies, support UK jobs, and build capability here. Before the hyperscalers, British providers delivered the same services—often cheaper. AI is no different.”
Without a shift in approach, Butcher warned the UK risks surrendering control of its data, platforms and future workforce, while failing to deliver on its own AI ambitions.
Lessons from cloud: avoiding a new generation of AI dependency
Elsewhere, HPE’s SVP and managing director, UK, Ireland, Middle East and Africa, Matt Harris, said the UK’s current AI debate must be understood in the context of earlier policy choices around cloud computing.
He argued that the government had made a deliberate decision to become strategically reliant on a small number of public cloud providers, concentrating market power and creating critical national dependencies.
That approach, said Harris, benefited global hyperscalers at the expense of the UK’s own technology sector, weakening domestic capability and limiting long-term economic value.
“We centralised our data, infrastructure and spend with a handful of companies, and the real winners were not the UK economy or taxpayers,” he said.
Looking ahead, Harris warned against repeating the same pattern with AI. He called for a unified national effort to build a strong UK AI ecosystem, which supports homegrown companies and reduces structural dependence on foreign platforms. Without a shift in direction, he argued, the UK risks locking itself into another generation of technology dependency, rather than using AI to drive sustainable growth and competitiveness.
