UK AI minister Kanishka Narayan: “The role I have is the best job going”

0:03Hello and welcome. Today on the Sifted Podcast, I'm delighted to be joined by Kanishka Narayan, the UK's AI and online safety minister. For our audio-only listeners, I'm afraid you might hear just a few blips in the sound quality thanks to some dodgy Wi-Fi while we were recording. But if you fancy watching the video recording of our conversation on YouTube, it's all tip top. On to the episode. Canisica's joining us hot off the heels of the big reveal of UK Chancellor Rachel Reeves' latest budget, which announced some fairly positive moves for Britain's entrepreneurs, which we will discuss today.

0:39He's also just finished a whistle-stop 24-hour tour of the UK, stopping off at London, Edinburgh, Newcastle, Sheffield, Belfast and Newport in Wales, where he met local AI leaders. In his role as AI minister, which he's had for just two months, he holds some pretty chunky responsibilities, including ensuring that the UK seizes upon the opportunities AI presents to us and leverages tech for growth. I'll also be asking Kanishka how he thinks Britain is doing on those fronts. But first, welcome to the podcast. Amy, it's great to be here. I've been reading Sifted online for many years, both in politics and before it, so it's great to finally be on the podcast as well.

1:19And I see you have a nice, for anyone who can't see this podcast, you have a lovely UK flag behind you. Are you joining us from Westminster today? I am. I was in Wales earlier today with a Welsh flag badge as well, but today you can see, I believe you can see in the background the Union Jacks flying properly as well. Lovely. And before you became an MP, you were a civil servant. You worked in finance where you advised companies and corporates on M &A and capital markets. And then your career began to more closely resemble the people we typically have on this podcast. You studied for an MBA at Stanford.

2:00you joined a fintech VC firm called Tower Ventures. Do you think that that background impacts the way that you approach your job as an MP? Yeah, I mean, one of the things I really loved working in venture and tech was effectively the really exciting and distinctive cultural attitude that a lot of people have, which is to pursue really ambitious goals, to do it by knowing that the quality of talent and the quality of people around you is the single biggest determinant of success. And often, as I say, I've tried to adopt a bit of a founder mindset in politics as well, to have that level of ambition to make something happen out of nothing, to know that talent and people are the most important thing in any business.

2:42And third, really importantly, to have a degree of sort of productive paranoia about runway. I'm conscious that in politics, every day matters a huge amount, as it does when you're running a startup as well. And so I'm trying to bring some of that mindset to politics as well. And how's that going? How embracing are others of the VC, the startup world's mentality? Look, I think actually this is a really amazing moment for that mentality to make a difference in politics, to make it very practical. You know, I ran as a first-time candidate a year and a half ago and was lucky enough to both be the Labour candidate and to win.

3:17And then since then have had a huge fortune that a couple of months ago, the Prime Minister obviously deeply values the future of AI as a driver of prosperity and opportunity in this country. And so offered me the chance to draw on my experiences in venture to make a difference here. And already, I think it's making a difference because, as you'll have seen in the run up to the budget, we announced a huge 25 billion package on support and investment in AI right across the country. And the entire reason for being across the country recently was to say that we are now making moves on AI as a country, which I think are globally really distinctive.

3:54And I feel very grateful for the opportunity of having that role. You must have felt a bit like you kind of hit the jackpot when you were asked to be AI minister. I'm sure that must be one of the most exciting jobs in Westminster. What would you? Yeah, I mean, I think so. I'm sure every politician you ask will say so. But look, I think, you know, the biggest mission for us as a government is to make people richer and more prosperous across the country. I think AI is the best shot we have. And broadly, science and technology is the best vehicle for making that happen in the country. And then the second part of my job is really important as well, which is that I think the future of how we relate to each other is really about how we relate to each other online.

4:38And so keeping us safe, thinking about social media regulation is a deeply important question. So both for prosperity and for this sense of how we retain human connection in the age of AI, I think the role I have is the best job going. And how firmly do you think the rest of government shares that belief that you've just said you have that definitely a lot of our listeners have that kind of tech can be the growth lever for this country or I guess any country? I think we had a very clear statement in the run-ups of the budget and in the budget that that is now a belief widely shared across Scotland.

5:18We announced, as I said, 25 billion of investment in Britain as a result of changes we made on policy. We've announced that when it comes to energy, one of the most critical inputs, both for technology and other industries, AI growth zones are going to be prioritized in grid queues. That is a clear statement that AI is top of the list of our priorities when it comes to growth levers. We announced an expansion of talent visas for high potential folks. We announced that global talent taskforce that now work hands-on to deliver on that as well. We announced what I now think is the world's best tax regime in any comparable country for workers and tech companies to have stock options.

5:55And so across the board, when it comes to fiscal investment, half a billion sovereign AI venture fund led by James Wise, when it comes to policy reform on energy, when it comes to talent, when it comes to a broader sense of focus on tech and AI, I think that is now a belief that is very widely shared across government and not just in theory, but in practical policy as well. And do you think we're moving fast enough? Another thing that people in the startup world love to talk about is just moving at speed. How do you make that happen within a government that has a million things to consider and a million other things to spend money on and et cetera, like a much bigger, more complicated beast?

6:35You know, Amy, when I was in venture, the answer to, are you moving fast enough, was always, we can go faster still. And that's still the answer for me in government. We have done a huge amount in the course of just the last few months. I think when you look to the package in terms of$20 ,000 billion investment, the appointments we made as ambassadors, Tom Blomfield from Wanzo being one of them, when we looked at setting up a half a billion venture unit, when he looked at an AI for science strategy, 137 million, right across the board, when you look at the community package of support for making AI relevant to people's lives, I got a bunch of texts from founders that day to say, gosh, the scale and weight of what we're doing in the UK, I think, is really distinctive on AI.

7:12And the budget then added a bunch of stuff on top to support in particular employees and tech startups. And so I think we've had a big acceleration. The answer to, are you going fast enough? Is we want to go even faster. How do you do that? I guess something that's felt quite distinctive maybe in the past few years is how many people from the tech world that people like me are very familiar with. People like you mentioned, James Wise, who's a partner at the VC firm, Balderton in London, Matt Clifford, who is the AI advisor to the UK government and one of the co-founders of Entrepreneur First. There's also Alex the Pledge, a serial founder who came in as the entrepreneurship advisor and a whole bunch of other people I haven't named.

7:57But where is that push coming from and what impact are you seeing that have within government, within how policy is made, having those people who are still in their other jobs and firmly within the tech community, advising maybe more than ever before? This is really critical. And I think there are two things that come to my mind. One, I think we are now getting that across the stack of governments. So you can see that in non-exec roles. So like I said, James Weiss from Baltimore and Capital is going to be chair of Sovereign AI unit. We see it in roles like the AI ambassadors, Tom Blomford from Monzo, Raya Hatzel from DeepMind, Simon Johnson won the Nobel Prize for the economics of technology.

8:44all AI ambassadors for us. Jade Leung, the new Matt Clifford in 10 Downing Street, Prime Minister's advisor on AI, has an exceptional background in both AI governance and AI investing. You can, in a small way, see that in the ministerial team. My colleague, Patrick Valance, was head of R &D at GSK. Liz Lloyd has a great background commercially as well in investing, and obviously, I was in venture as well. And so you're now seeing at the non-exec level, at the ministerial level, at the advisory level, and actually at the technical level. I'm so proud of the fact that the AI Security Institute has some of the world's best AI engineers right in the heart of government, showing that collectively, when you bring great talent into government, you build a sense of deep conviction about what the state can achieve in the interest of the White Department.

9:30The second thing to say is that it's not just about people in government. There is an amazing ecosystem we've built up now in Britain, which is the ecosystem of people outside of government informally, but walking in the same collective journey towards making Britain the best place in the world for technology and AI. And there are way too many people to name here, but I've just felt such excitement from founders, from investors, from people who've been there, done that, and want to still give back to the ecosystem. We're now getting to a takeoff point in the kind of ecosystem effect that I saw and experienced in the Bay Area.

10:03I think we're getting that with a very distinctive British flavor, which is about spreading opportunities all places, not just one place, but also having a sense of focus that you're not just creating a slop, you're creating science and big leaps in things that matter to day-to-day lives of people. And then to ensure that you are getting the best representation of all the different kinds of organizations out there, that you're not maybe just speaking to the biggest and best-funded AI companies, that you're also speaking to some kind of up and coming ones, that you're not just speaking to the people who, I don't know, live in London and are maybe easiest to access for a lot of the VCs who are based here.

10:45How do you kind of balance that and balance that you're getting that representation of all different types of tech companies and businesses of any kind that are going to be affected by AI? Really, really critical question, Amy, because the only way in which we can build prosperity through tech and AI is if we build that across the country. And that is exactly why when in the run-up to the budget, I was very keen that straight after the budget, I was getting out there right across the country to say that the focus of this government is both on small tech and spread out tech. And so in London, I was at Stripe meeting a bunch of startups supported by Stripe, talking to them about how remarkable the budget's contribution on tech and AI was.

11:25In Edinburgh, I was speaking to the university and small spinners from the university to be able to make sure that they felt they had a strong voice right at the heart of government. In Newcastle, I was working, saw a bunch of AI trainees who are folks literally just out of university wanting to build new companies and new applications, learning about the earlier stage of the pipeline still. In Sheffield, speaking to startups and advanced manufacturing and AI. In Belfast, speaking to the university and AI cyber companies, as well as in particular groups focused on encouraging women to play a fundamental role in building AI companies.

11:56And finally, in Newport just this morning, talking to both big investors in compute, but also small folks building amazing startups in Wales as well. And so the big focus is that in Britain, we're going to do this in a way that spreads opportunity, that the best of small tech in our country, but also make sure that it's tech that's spread out right across every part of the country. Interesting. Do you see as the biggest opportunities for the UK when it comes to AI? Wow. Okay, I'm going to pick one. I think the biggest opportunity for us is to be the world's adoption nation. I think we have historically had a great time in adapting new technology, spreading it across parts of the economy and public services, and as a result, becoming more prosperous and more fulfilled.

12:44at the economic opportunity of our lifetime is going to be how quickly and how well we can adapt and adopt AI to fit in with our existing work lives and make us way more productive as well as give us a sense of delight and fulfillment day to day. And because of our size, because of the fact that we have currently a government that is willing to move very flexibly on appropriate regulation, that we're able to actually, as a result of that, drive way more value from AI for the ultimate experience of people across this country. And so to me, the big opportunity is let's really drive the adoption of AI, especially in areas of strength in discovery and life sciences and advanced manufacturing and professional services and in the creative sector.

13:27And on the sort of risks side of things, what are your biggest concerns or the areas you know we need to devote a lot of attention to when it comes to security? You mentioned how every single one of us in our everyday lives interacts with AI and what that means for us and how we interact with other people, etc. What do you see as the really kind of most concerning? If we don't deal with this well, this could not be good down the line. What are those things? I think there are two buckets that I think of here. One is a set of acute risks. And so these are really the event-specific risk around a cyber incident or, let's say, a national security incident.

14:15Some of those risks increasing as a result of the fact that AI is way more widely available than previous technologies of comparable impact and is getting even more impactful over time. And so there, the single most important thing we can do, which I'm really proud of doing in the UK government, is to build the best capability and understanding of models and model capabilities in government so that we can then act defensively quickly to secure our interests nationally and to make sure that we're protecting people domestically. And so the AI Security Institute is the world's best organization when it comes to having the capacity, the capability to understand those acute risks in model capability.

14:56There's a second category of risks, which is in some ways harder to solve still, which are chronic risks. These are changes in our behavior and in our resilience as a society over time as a result of AI. One of those, as you said, is how we relate to each other online when we've reached a crossover point where AI-generated content is greater in volume than human-generated content. That over time has an impact on our beliefs, how we relate to each other. There's also an impact in terms of education and career, right? The first couple of the rungs of the ladder are now becoming a bit weaker because we can deploy AI.

15:33And so how we build careers that allow people to get good apprenticeships as well as move up the ladder and do the things that are distinctive to humans. These are really important kind of longitudinal chronic questions, which require, yes, interesting policy ideas. But more than that, they require us all to play a bit of a part in making sure that we're thinking deeply about impactful AI adoption in a way that is most augmenting of human capability rather than substituting a bit. And how would you, you've mentioned the AI Security Institute, how would you mark their homework or can you share any, maybe you're not allowed to give away the exact details, but what are some tangible things that organisation has said or recommended or warned the government about that has made it such an asset and such an important thing for this country to have?

16:27Yeah, I think there are two things that are really important channels of impact for AC, the AI Security Institute. One of those is building understanding and assessment of risk across government, and in particular with our national security agencies. Obviously, it would be difficult for me to share the content of the risk assessments. But broadly speaking, I have seen a very significant increase in the seriousness with which the rest of government engages with AC as a result of the quality of those assessments. And so you can see that as a proxy indicator of how effective AC has been. The second thing is that AC is, I think, one of the world's most advanced settings in which companies are willing to come and say, you are so good in terms of your capability that we want to work with you before we release models into the wider world so that we are collectively walking that journey of ensuring that our models are risk-proof as well.

17:21And so you can see that in that outcome as well, the capability, the effectiveness in advising companies and making sure that those companies are acting appropriately and mitigating the most severe risks as well has been so effective. The companies are now seeking out AC as one of the only capabilities comparable in this world to do that work with. And whether, I guess, with just the scale of all the places in which AI is impacting society, the economy, etc., how do you kind of weigh up where government should put its resource here? I guess I'm thinking that we hear of just such immense funding going into this sector from the private sector, from some of the huge tech giants that are investing here.

18:12NVIDIA came to the UK and splashed around a whole lot of cash earlier this year. But then there's also things like which the government which has already put in place, for example, like making it easier for talent to come and work in the UK or upskilling the workforce so that they are ready for wherever AI takes us, etc. How do you weigh up kind of how much money, actual money government should put into this sector in terms of funding or in terms of grants versus maybe putting your resource instead, especially in a castrate world, as we know from the latest budget, into things like changes to visa schemes, etc.

18:56So I realise that was a long question. No, really, really, really good question. And it's one of the most central policy questions to ask, which is that you start with the outcome. The outcome is we want to be the best place in the world for AI's impact on our productivity and on our public services and our sense of fulfillment as people. And then you walk back to say, what is the way in which we can use all the levers of government to achieve that outcome? The package I mentioned at the outset that we announced just prior to the budget was$25 billion in investment, some of the largest infrastructure investments in the history of this country.

19:30We didn't have to put forward taxpayer money to be able to do a lot of that. There was some money, which I'll talk about in a second, but for scale of infrastructure build-out, there is private capital willing to flow into Britain because private capital feels that they have a stable political environment in Britain. They have a good, well-run economic context, and then they have micro-policy on energy, on planning, on deregulation, which means that they're able to put capital to work in creating opportunity and jobs right across this country. So for infrastructure, I think we're a good place without having to put a lot of money in.

20:05I think for strategic interests like sovereignty, the private sector alone is not going to try and deliver what is in the British national interest if it is not partnering with government in a deeper way. And that's why we announced both a series of policy measures, but specifically direct public funding through the Sovereign AI unit. And one of my aspirations is it's not just direct equity funding as a venture unit, but also ultimately we want to walk on procurement. So the fact that we announced a world's first advanced market commitment for novel chips was a really important part of that. Why?

20:37Because private sector alone is not going to deliver British capability, which we think is really fundamental on this transformative journey that we're on. And then there's a third thing, which is that we don't just want good infrastructure. We don't just want sovereignty. We want to make sure that it is in light of British values and that the public sector might want to do a little bit as well. And so the fact, for example, there's a gap in the scale of capital market. And so through the BBB, we're now increasing the pace of deployment from one and a half to two and a half billion a year. We're asking the BBB to deploy seven billion in scale of capital alongside pension reforms.

21:12That's all saying a mix of regulation, regulatory change and capital from the public sector is going to make a difference. And we think it's important to keep companies, which are fantastic companies here in Britain, as they scale up. similarly in communities. I want to make sure that the kids growing up in Wales, in Scotland, in Northern Ireland, in Yorkshire, all benefit from this. And that's exactly why we've announced that every AI growth zone spread across this country is going to get millions to invest in community benefits and business adoption in those communities as well. And so to sum it up, I think on infrastructure, I don't see a sharp need for the public sector to put direct capital to work.

21:48I think there's a lot we can do by being great partners on planning, permitting and regulation. But on sovereignty and on making this salient to people's day-to-day lives, there is such public benefit there that the private sector alone is unable to capture exclusively that I think we need to be very good partners, both in some cases with direct capital and in other cases with wider levers of government. And do you look to what other countries, whether that's in Europe or elsewhere, are doing when it comes to AI? And how often are you in touch with your peers effectively in those governments to understand what approach they're taking?

22:28Yeah, I think I'm sure there's more to do here. But, you know, when I've been in the job for about two and a half months, I was very glad to welcome the U.S. delegation with President Trump when we announced one of the largest bilateral deals on technology, 30 billion plus in AI investment in the U.K. and so I engaged with my US counterparts. I was very glad to sign a memorandum of understanding with my Dutch counterpart because the Netherlands has an amazing role to play, not least through companies like ASML and applied coding companies, but also just as a great ally when it comes to thinking about strategic leverage and sovereignty questions with shared values.

23:07Obviously, I'm conscious that India will host the Global AI Summit in February and so we've been engaging the head of the India AI mission was here for a conversation a week or so ago as well. And so right across the board, we're trying to make sure that Britain is both open for business, engaging with people and setting out a distinctive vision for the future of AI alongside our allies. Does it feel like a race to kind of ensure that as many of the world's great AI companies are working here, are hiring people here in the UK, are investing money here that, you know, British AI startups are raising more money than French or German or Swedish AI startups.

23:53Is there a certain amount of kind of that pressure or feeling that this is a kind of global competition? I think two things are really on my mind. One, there is clearly an element that the opportunities now. And we need to move fast to capture that opportunity. That is exactly why we got a deal done with the US on tech that meant 31 billion or so of investment coming straight into the UK. That is exactly why we've moved at such speed in the run-up to the budget to make Britain the best place in the world for workers to have stock options and AI companies for the level of investment by a billion in British air.

24:29But the second thing is really important, which is that this doesn't feel like a solo 100 meters race. It feels like a tag team kind of race, because ultimately we want to make sure that we're working with trusted allies on a question that is going to be transformational for the world. And there are really critical elements of national security, of the values in the development of AI that we have to make sure that we're working with those who share our values with on shaping as well. And so that's exactly why I've been very keen on working very closely with the United States, with our colleagues across Europe, but also countries like India as well, who have a great shared history with the United Kingdom and a sense of a shared future orientation as well.

25:10And to return to the budget, we've obviously mentioned a few of the measures that were announced, including changes to the EMI scheme, which is used by many startups to reward their employees with shares in the company that became sort of open to more people so that more employees could benefit and things like more money for the British Business Bank to invest in the ecosystem of all of the tech-related measures that were announced in the budget what was the hardest one to get over the line the second thing was the most important in terms of overall scale that was a major series of reforms on alien growth zones especially focused on energy policy and planning policy because that is not just a specific uh it is a system-wide change That means Britain is a great place for major investors to invest in AI infrastructure.

26:06So in our KI growth zones, we'll get the first dibs in terms of acceleration in the grid queue. They will be supported through a concierge type service, which will mean that we can get those bays in the ground, jobs created, and compute up and running as quickly as possible. They will get support so that especially if they're building in places like Scotland and Cumbria in the Northeast, a lot of those places where there's excess generation of electricity, in those places, if folks are building data centers and AI infrastructure, they will get some of the savings back to them. So the economics is more attractive.

26:38The reason why that's really critical is because there is a bit of a choice in British politics. You can either say that you have to choose between two really important missions, creating green jobs, which are really fundamental for our long-term future, or creating AI jobs. Or you can take a different attitude, which says those are fake trade-offs. And the thing that is in our national interest is to pursue a mindset of abundance, not scarcity, to do both clean power and to do AI together. And that was really compelling. In North Wales, we announced an AI growth zone, 5 ,000 jobs, alongside nuclear SMRs, another 5 ,000 jobs.