Reeves announces push for tech sovereignty with £2.5m for AI and quantum

In addition, “Sunrise” AI supercomputer will accelerate fusion research

The UK government has announced more funding for AI, quantum and supercomputing, and initiatives to boost tech sovereignty and support domestic scale-ups.

The government is stepping up its ambitions for advanced computing as a cornerstone of its technology and economic strategy, combining targeted infrastructure investment with broader funding commitments aimed at keeping innovation, and high-growth companies, here in the UK.

A clear signal of that intent came yesterday with the launch of “Sunrise,” a new AI supercomputer developed by the UK Atomic Energy Authority (UKAEA). Backed by £45 million in public funding, the system is designed to accelerate fusion energy research - an area which could prove critical to long-term energy security and decarbonisation.

Powered by hardware from AMD and built on the Dell Technologies PowerEdge platform, Sunrise will deliver 6.76 exaflops of AI-accelerated performance. That level of compute is intended to support complex simulations across plasma physics, materials science, and tritium fuel development, which are the three key barriers to scaling fusion energy and thus making it commercially viable.

Sunrise is evidence of government understanding of the potential of deploying high-performance computing (HPC) and AI infrastructure in strategically important areas like energy.

Quantum and Sovereign AI

This infrastructure investment sits alongside a larger funding commitment outlined by Chancellor Rachel Reeves, who has pledged up to £2.5 billion across AI and quantum computing initiatives. Within that, up to £1 billion is earmarked for quantum computing procurement, forming part of a £2 billion plan to expand the UK’s quantum capabilities.

Q-Day may still be five to ten years down the line (as many have observed this has been the case for about twenty years) but quantum systems are expected to unlock new approaches to optimisation, cryptography, and complex modelling which are all areas with clear enterprise and national security implications. Quantum readiness may not be at the top of the CIO to do list right now, but it could be moving into position for long term roadmaps.

Reeves will also confirm in her Mais Lecture today speech today that a £500 million Sovereign AI Fund will launch in April, targeting domestic AI companies and aiming to close one of the UK’s most persistent structural gaps: the ability to scale startups as opposed to having them relocate to San Francisco in search of capital, a more favourable tax regime and a working culture viewed as more amenable to innovation.

Reeves has been explicit that reversing this “drift abroad” is a priority, framing state intervention as necessary to build a more competitive innovation ecosystem.

Prime Minister Keir Starmer has previously positioned AI and advanced technology as central to the UK’s economic growth strategy, positioning AI as a lever to accelerate productivity across sectors.

Taken together, the Sunrise supercomputer and the broader funding commitments could be viewed as a more interventionist and coordinated approach to technology policy, which has been welcomed by some in the advanced computing space.

James Palles-Dimmock, CEO of quantum computing firm Quantum Motion said:

“The UK has led the world in the creation of companies built on quantum technologies. With this procurement programme, the government can now turn that scientific and entrepreneurial leadership into real capability by purchasing the most powerful computers the laws of physics allow us to build. Programmes like this give British companies the confidence to scale, attract investment and compete globally. Strengthening our ties with Europe while backing homegrown innovation will be critical to ensuring the UK remains at the forefront of the quantum era.”

However, others argue that the roots of the scale up challenge go much deeper. Barney Hussey-Yeo, CEO and Founder of UK fintech unicorn Cleo, which returned to the UK from the US with a $1bn valuation, argues that the London Stock Exchange is not fit for purpose, and that financial reforms are needed to encourage domestic capital towards tech scale-ups:

“2025 was the LSE’s strongest IPO year since 2021, but it still saw high-growth companies like TeraView drawn overseas by deeper capital pools and markets that reward ambition.

“The Government should be abolishing stamp duty on UK-listed tech shares completely, accelerating the Mansion House Compact, and creating tech-focused ISAs that channel domestic capital into growth businesses. As the global economy enters an AI-driven growth cycle, scale is decisive, and without aligned venture capital, pension fund participation, public funding and a listings regime that rewards ambition, the UK will continue to export the value it creates.”