The UK government has launched the first competitions under a £100 million procurement scheme designed to give homegrown AI startups a route into public sector contracts. Chancellor John Healey unveiled the R&D Procurement Scheme, part of the wider Sovereign AI initiative, at a G20 finance ministers meeting in North Carolina, with ministers framing it as a way to help "strategically important" British AI firms scale up and compete globally rather than losing out to overseas competitors.

The first four competitions target NHS productivity, defence, computing efficiency and AI agent security, inviting firms to build systems for automating health workflows, securely linking defence data with frontier AI, improving public AI infrastructure efficiency, and managing risks from increasingly capable AI agents alongside the National Cyber Security Centre. The scheme sits alongside a separate £500 million venture fund for British AI startups. It comes as separate research from Mattison Public Relations finds AI is now used by every UK government department, up from 81 percent a year ago, yet only 30 percent have issued formal staff guidance on using it, 63 percent have a formal AI strategy, and savings targets remain modest, such as HM Treasury's roughly 1.5 percent goal, echoing past criticism that £45 billion in projected AI savings lacked clarity.