Emergency Podcast: How will Andy Burnham change the UK's AI strategy?

0:00So my initial reaction was a lot of frustration. I definitely shared some of the reactions of you saw various tech voices on X talking about how frustrating they found it to see things like self-driving cars described as having been, you know, gung -ho approach to getting those introduced when in fact the regulatory process has actually been extremely slow and careful on that. I think that makes me concerned about who is advising him on this, because as Alice said, this just doesn't add up into anything really coherent.

0:42Welcome to Path Founders, where we like to unpack the code, the capital and the consequences in the startup ecosystem. Today, we're looking at what could become a major reset coming for Britain's AI strategy. According to the Financial Times, Andy Burnham, who is pipped to be the next UK Prime Minister, is exploring a shift away from the current policy towards one built around UK tech and AI sovereignty, regional growth, re-skilling the non-tech working population and more public accountability. The big issue he appears to be focusing on is making sure technology serves British companies, local communities, and people whose jobs may be disrupted by it, as opposed to the more AI forward approach we'd become used to.

1:30The previous administration under Sakir Starmer had a double-headed strategy of both wooing US tech giants like OpenAI and Anthropic, while also being a loud booster of homegrown AI companies. Indeed, it even launched a£500 million sovereign AI fund. But are we about to see the rise of a far more tech-sceptical UK administration? Joining me to discuss these issues is firstly Alice Key, an editor, writer and journalist who writes the Substack newsletter UK 2.0 and often touches on UK tech policy. And we're also joined by Meriam Arick, who's the co-founder and CEO at DoubleWord, a startup which builds high performance open source model inference infrastructure for AI at scale.

2:21So a company very much at the cutting edge of the AI industry. So first of all, it'll be great to get your initial responses to the FTPs and what you kind of made of it all. Alice, what was your initial reaction? So my initial reaction was a lot of frustration. I definitely shared some of the reactions of you saw various tech voices on X talking about how frustrating they found it to see things like self-driving cars described as having been you know a gung-ho approach to getting those introduced when in fact the regulatory process has actually been extremely slow and careful on that uh i think around i'm a little bit less worried um and i'm probably seeing this as a bit more similar to when we've had budgets in the past where several lines from them will be leaked in advance and several of them will never actually make it into the real budget uh and it's it's more of a let this out into the world see what the reaction is gather some information that way so that you don't have to announce it and then you turn so I'm a little bit more optimistic you've seen a little bit of pushback in the Politico newsletter today from unnamed sources close to Andy Burnham saying you know nothing's decided yet nothing's official so I think we need to hopefully stay calm and see what's in store but definitely some of the lines in that piece that there was a little bit to be worried about there.

3:59So in other words, your classic political play of floating some ideas, popping them around via unnamed sources, see what your action is, and then adjusting accordingly. I think so. And it's all a bit unofficial now because we've got some idea of who's advising Andy Burnham, but there's also, he's not prime minister. He hasn't made any official appointments. So we don't even know who exactly to trust and believe. Not that people are necessarily lying, just that we haven't seen him sort of make those final decisions yet in terms of who will be officially around him in number 10. Right. Yeah. Miriam, what was your initial reaction to what was being proposed?

4:43And how do you see things playing out, perhaps? I think I was a bit surprised. I think if there's something that Keir Starmer has done well and is pretty well respected for is the tech policy. We've had like a huge amount of tech growth since Keir Starmer's premiership. And so it feels like a strange thing to try and diverge with him on. And I specifically was like very intrigued by this idea of labeling Keir Starmer's policy is like very U.S. focused and U.S. first. when it's actually significantly less US focused than we have been for the last 15 years. It's the first time we've really ever had conversations about sovereign tech and taking steps towards supporting homegrown champions.

5:30And the things that we have done that have been US focused have actually been very smart growth decisions. For example, Anthropic hiring a bunch of people are hugely high paying jobs, which we desperately need. And I guess like in reaction to what Alice just said is why do we need to be floating out things like this, which are obviously nonsensical? For example, the self-driving car policy makes me a bit concerned about who is advising Andy Burnham and whether they really know exactly what they're talking about. because actually a lot of the things that were mentioned in this article just seem really far away from the necessity of what's needed in terms of our position in the global AI market and also what's needed from the industry in general.

6:16So I'd be it's making me concerned, but only insofar as like who is advising him and who is possibly saying these things to these journalists, because actually it's not a coherent tech policy. that's interesting and it and there were um a couple of names floated but there's no in the piece but there's no sort of confirmation of anyone officially informing him uh alice did you get did you get the impression that it was a little bit like you know the stuff about the you know getting rid of drivers cars and starting to worry about black cab drivers was kind of uh right sort of uh pushing the overton windows shall we say i think it's very interesting driverless cars in particular they haven't got too polarized in the uk um but i've been to lobbying events in washington dc about self-driving cars and it's a lot more polarized uh in the us especially local politics like mayors and sort of city candidates will take a yes or no um on self-driving cars but it's not it's not less it's less about this kind of safety the point i think it's much more exactly what was said in the piece the worry about people who will lose basically their income because they're uber drivers or for a similar service i think that's an interesting one because it's there's i would say that the self-driving cars companies will say actually we won't kind of flood the market immediately with thousands of fees even when we start it won't be a notable amount compared to the ubers on the on the road so this will actually be a very gradual transition but of course you do probably need to think about what will you do if there were just suddenly lots of people who perhaps already had lost their job in various other industries who've turned to gig work to make that work how are they going to make money if they are replaced by driverless cars.

8:16So that's a perfectly valid point to raise. But then it was, I think it was the quote specifically about this, like, who needs this? Who is this for? That really riled a lot of people up. Yeah, well, perhaps it was a bit of a dog whistle for some. But as you say, there are wider issues that probably need to be addressed, especially sort of re-skilling. And on that note, there was one of the things that was floated was about devolving more tech funding away from Whitehall. And there is obviously already an existing sort of AI areas approach. And it wasn't really clear how that might change under a new administration.

8:57What are both of your thoughts about doing that? Because on the one hand, I think having a single sort of AI approach, shall we say, probably benefits the country. But again, if you get a patchwork of approaches that might cause issues. What do you think, Miriam? I think my biggest concern is whether this will dramatically slow the development of data centre infrastructure and energy infrastructure. The UK is already incredibly far behind when it comes to the amount of data centres that we have and the amount of capacity that we have. Now, this is one of those issues that isn't kind of one of the kitchen table issues but actually become very important the governor of the bank of england potentially talked about us having to ration ai because we wouldn't have enough data centers domestically um and my concern is a devolved issue we actually just won't build the capacity that we need um and we are all far behind one of the biggest costs when building data centers is actually delays um it's like high energy prices is a tiny cost to the data center provider compared with the cost of delays.

10:08A year delay or a year and a half delay is far more costly than energy or anything else. And we already have a planning system that makes, and I'm concerned that further devolution of this will make it even more difficult to build. But as you said, we don't actually have any policies of what's going to happen and what this will mean. But my concern will be devolution will mean it will be harder to build the energy infrastructure and the data center infrastructure that we really desperately need. Yeah, Alice, what do you think about that sort of devolver, devolution approach that he's taking? He's sort of taking it from a wider political angle, isn't he?

10:43But he's also sort of mentioning that might feed into tech policy was also an interesting one. And also the fact that AI data centers should be 100 % owned by the UK, as the article said. It sounded interesting to me because I'm not sure how that would quite work. yeah i think that devolving it is very interesting because that was actually the framing that kanishka narayan the current ai minister came in with um even before he was the minister for ai when he was you know because he's an mp um for the veil of la morgan in wales you have to as an mp if you want to talk about ai you have to talk about why it's going to be relevant to your constituents and so he had this whole like framework of how we're going to make this something that benefits the rest of the uk and then you've seen when he was reshuffled in and then liz candle came in as the secretary of state for decent she put put in a lot of work into you know reskill and that kind of thing and so clearly actually both of them did already have a bit of a ideological you say framing of this needs to be something that benefits everyone throughout the country and so I think that's already been there so the question is are they just going to reframe that to make that more obvious and talk more and more about how specifically it's going to benefit people in other parts of the country or is there actually an underlying change um I'm not sure at the moment i think there's like two two aspects i think there's the aspect of ai that is of national security um and kind of like uh geopolitical importance and that has to do with our energy infrastructure and building enough data centers and ensuring we're competitive that's not a good idea to make that devolved but actually the idea of reskilling and making that devolved or figuring out what industries, new industries we should kind of encourage.

12:43That makes sense to have devolved, but there's a bunch of stuff that is of national security importance that we can't and shouldn't have that to be devolved policy. That's a very good point. And do you think perhaps the technology industry in the AI sector could maybe get behind the idea that, you know, re-skilling has to be part of the conversation, given the impact that AI is going to have on jobs from white collar work, labor, AI plus robotics, etc. Yeah, I think that is the kind of thing that makes a lot of sense to be a devolved program. Every area needs to figure out the industries that they can be competitive in and work to build them up.

13:26And re-skilling is a great way to figure out how you can be competitive in a brand new industry. um i think in london we are focused on ai as a driver of growth and i think it's important that we focus on that as a driver of growth but also simultaneously parts of the country and parts of politics need to be thinking about how do we kind of reskill parts of of the workforce so they can also participate in this growth and this boom that we are creating um there's a lot more people always thought you know software engineers would become obsolete because of core code there's way more job roles for software engineers now than there were a year ago or two years ago how do we reskill people which I think is something that we've been trying and pretty unsuccessfully doing for the last you know 10 to 15 years anyway and maybe a devolved approach to reskilling might have more success.

14:15Do you think Alice that we'll see some sort of Manchesterism for the AI age appear? I guess there's been so many debates about what is Manchesterism you know Manchester itself has huge investment from companies that are not from the UK and from other sources so how does that square up with this idea of let's have less outside investment from the US I think at the moment yeah none of it is quite gelling together because it's like are we investing more are we actually the saying like actually let's go whole hog on this and let's own all our own data centers and let's not rely on anyone else or are we saying there's been too much attention paid this is not what what people want uh we should stop you know having all these government headlong you know rush into ai programs in which case you could see the funding being actually cut for ai so i just i think again this is why i'm sort of trying to take it with you know a pitcher of salt because it's not quite adding up into a real program at the moment.

15:27I think that makes me concerned about who is advising him on this because as Alice said, this just doesn't add up into anything really coherent. Now it is unnamed sources in the FT, so maybe we're just blowing this up for proportion. Well, Alex, you did also mention the AI minister who the tech industry appears to have taken quite close to their heart and seems to be getting a lot of plaudits out there for some of his enthusiasm for the industry and his ability to explain it at a high level. Perhaps you could both of both of you give me your star chamber of who you think should stay or be brought in or, you know, thrown into the into the into the mix.

16:15Or do you are you pretty happy with where things have gone so far and sort of don't frighten the horses? Don't try and fix something that's not broken. What do you think? Alice first. I think less my perspective but just from people I'm talking to across tech what people are most worried about is losing time in this you know this AI race that is very fast and a reshuffle would just mean losing six months of time especially if you reshuffle in you know the reason people like Kanishka is because he knows what he's talking about if you reshuffle in someone who may be fairly competent in a general way but doesn't actually have the expertise in this area they need six months to get their feet under the desk and work out what's going on and take advice from all kind of conflicting areas of industry and activists and think tanks and then come up with something coherent from that people and we were just fallen further behind um i i guess star chamber you know obviously i think yeah people do really like him um so they don't want to see him shuffled out um maybe they'd have even loved to see him promoted to being in charge of dsit uh or perhaps another department and yeah i think there's that and then i mean people still love this like idea of matt clifford running for office somehow i don't i don't know that's going to happen that Matt Clifford obviously is sort of the author of the current government's AI strategy.

17:53I think if they're really turning away from that, then he's probably not going to get in so much of a look in here, but he's still going to be quite influential because he's the chairman of ARIA. And there's a lot of sort of outside of ministerial positions like that. We've got ARIA now. We've got the AI Security Institute. So it's not just like the cabinet, it's kind of this ecosystem now of like tech and AI around government. So I guess it depends how much stock is Burnham looking to put in all of these extremely well qualified people? Or is it more important to him to have, yeah, how like show the country that he is actually seriously changing course?

18:46Yes, and you mentioned Matt Clifford there, founder of Entrepreneur First and a very, you know, senior advisor to the government over the last couple of years and been at ARIA as well. And there have also, as you may have known, been one or two rumors about him getting involved in politics floating around, although nothing is confirmed or very obvious at this point. Miriam, what do you think? Who would be in your kind of top 10? Who would be in your team to represent the UK would you stick with who's advising at the moment or would you would you swap people or what would you do? I completely agree with Alice the most important thing is that we don't lose time this is moving incredibly quickly and is of real importance to our overall position as a as a country on the world stage going forward my what I would love to see in my dream team is Matt Clifford's AI action plan he spent a lot of time and effort getting that right we should continue implementing that.

19:44I think doing another review for the sake of it will not be productive and waste time. I would actually like to see Kanishka promoted to cabinet, but not within DCIT. What I would actually like to see is I would like an AI minister to be a cabinet level position because I think it is that important to our future. And also a lot of people say that DCIT is a bit over bloated anyway. And so I'd love to see Kanishka running an AI and online safety or or something like that department. And also I hear a lot of good things about Jade Lung who is currently the CTO of the AI Security Institute and he was also Keir Starmer's AI advisor.

20:25She has been doing great work. And then also James Wise has been a great champion for Sovereign AI. He's the chair of the Sovereign AI Fund, but also has been kind of a great spokesperson. I think, you know, I would definitely retain him where he is. So everyone has been thinking that actually Keir Starmer has done a relatively good job on tech policy. We can't waste time. And I think actually Kanishka should be promoted because he's proven to be doing a fantastic job. Well, that's very interesting. And I'm sure. Well, I can say we can certainly say that there's no there's no plants here. That's definitely from the from the from the from the from the hip there.

21:05although I do think that James Wise at Balderton, I think his colleagues at Balderton would be quite sad to see him go but as you say he's done a pretty good job of pushing through Sovereign AI and the Sovereign AI fund that they put together there and yeah well I mean I think this is the story will classically run and run and I thought it would be great to just jump in and create a kind of a quick emergency podcast on this subject but But thank you so much, Alice Keyes, editor and writer, journalist who writes UK 2.0 and Meriam Arick, co-founder and CEO at Double Word. Thanks very much for joining me with Path Founders.