The UK Government published its Budget 2026 on October 28, 2026, introducing a £700 million funding package for artificial intelligence, cyber resilience, and critical technological infrastructure.
AI and Cyber Security Funding
The UK Government announced a £700 million package to address AI risks and support its adoption. According to the publication, this includes an additional £120 million for the AI Security Institute and £40 million for a national capability to investigate and respond to agentic security incidents.
An extra £140 million will go to the Sovereign AI Unit to help UK AI companies scale and maintain a presence in the country. The package also funds the AI Economics Institute to assess the impact of AI on jobs, productivity, and living standards.
Industrial and Technology Investments
The Budget establishes a cooperation agreement with Rolls-Royce, starting with a 10-year, £2.5 billion programme to develop next-generation gas turbine technology for civil and defence aerospace. Additionally, the government announced three public-private investments in life sciences totaling over £1 billion, backed by nearly £70 million in grant funding.
Strategic data centre projects seeking government support will be expected to meet tests under a new Data Centre Covenant to support community investment, energy costs, British industry, and national security.
Key facts and where they come from
- The UK Government announced a £700 million AI package in Budget 2026.
The Budget also delivers the government’s most ambitious AI package yet, investing £700 million to tackle the risks of AI while unlocking its potential
- The AI Security Institute will receive an additional £120 million.
includes an additional £120 million for the AI Security Institute
- Rolls-Royce and the UK government agreed to a 10-year, £2.5 billion aerospace programme.
A multi-decade cooperation agreement with Rolls-Royce, starting with a joint 10-year, £2.5 billion programme, will develop next-generation gas turbine technology
