Technology Sovereignty

Anneliese Dodds Excerpts

Tuesday 10th March 2026 Westminster Hall

[Dame Chi Onwurah]

The level of interest shows just what an important issue this is. I will come on to discuss some aspects of collaboration as it relates to sovereignty, but I observe that the last time our sovereignty as a mid-sized power was seriously debated was during Brexit, and the slogan “Take back control” reflected the sense that too much sovereignty had been ceded to the European Union without an honest debate with the British people. As a member of the Labour party, I know that we are stronger together and that that can require some loss of autonomy to deliver results, which actually make people more secure, but that must not be done without an honest debate.

Let us look at the four specific sovereignty challenges, the first of which is critical infrastructure and cloud data dependency. The Competition and Markets Authority found that cloud services in Britain are dominated by AWS at 40% to 50%, and Microsoft at 30%. Crown Hosting is meant to be our sovereign hosting capability, but it only hosts 4% of Government legacy services. Both Amazon Web Services and Oracle claim to offer a sovereign cloud—they do say to deal with the difficult part in the title!

The second issue I want to look at is the hot topic of AI. There is no Brit large language model but there is the ambition to transform our public services and industry through AI. The AI opportunities action plan repeatedly references sovereign AI and sovereign compute without defining them. The major AI companies Google, Anthropic, OpenEye, Microsoft and DeepSeek are all headquartered abroad. DeepMind formed Google’s AI capability and was founded right here in the UK before being bought. What capability does the UK now have in AI? What minimum capability does the Minister think we need? How do we respond to the EU Cloud and AI Development Act, which may exclude UK companies?

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

My hon. Friend is making an important point. When it comes to AI, an enormous amount of investment is needed. There are many discussions at the moment about the impact of that huge investment in AI. It is very difficult for a smaller country such as the UK to compete in that regard. Does she agree that we need to work with like-minded countries on these issues, including those in the EU? Does she agree that we need to make sure that this is one of the key topics when President Macron visits the UK later this year?

[Dame Chi Onwurah]

I agree with my right hon. Friend that we certainly need to work with like-minded countries.

The third area is cyber-security and data governance. Some argue that we are already at war in the cyber-sphere. Last year’s strategic defence review emphasised cyber and electromagnetic domains, and established a new UK cyber and electromagnetic command to enhance that, with £1 billion in new funding for homeland air missile defence and cyber-security initiatives. Should these be British suppliers? Should they be European? Should they be exclusively NATO suppliers?

On data governance, the foreign direct product rule allows the United States to restrict access to advanced computing chips and AI-related software. By adding UK companies to the entity list, the US can immediately cut them off from cloud services, software and AI tools, while the Cloud and Patriot Acts expand data access powers to compel US companies to hand over data even if held overseas—that is, in the UK. Has the Minister discussed those powers with Microsoft, AWS and Palantir?

Fourthly and finally, we have the UK’s reliance on global supply chains. Critical minerals are an obvious example, but because I am a bit of a geek I want to mention the common information models that enable the things in the internet of things to talk to each other. By 2030, there will be 6 billion CIM connections globally. China controls 70% of the market, creating a huge possibility for the disruption of everything from traffic systems to energy grid operations.

That is a really quick canter through just a few of the technology sovereignty issues. I want to look at two specific examples in more detail. First, the NHS has the largest and most comprehensive longitudinal and structured patient level datasets in the world. I support the push for digital integration as we transition the NHS from analogue to digital, with interoperability and standardisation bringing faster access and better analytics, yet a growing share of NHS data flows through US companies.

The federated data platform contract places core NHS data operations on Palantir’s proprietary systems. Why? There have been numerous reports of irregularities in the way the contract was awarded. In addition—this, for me, is a key point of sovereignty—Palantir’s founder and controlling stakeholder, Peter Thiel, has a political worldview which is at odds with British values. The same is true of Elon Musk. It does our constituents’ sense of agency no good to see their Government so dependent on these companies. Nearly half of adults say that they would opt out of NHS data sharing if the platform was operated by a private foreign provider.

The second example is also to do with Palantir. Its recent defence contract also raised many questions. The strategic defence review emphasised AI as a core enabler of military capability. Reports suggest that Palantir serves primarily as a vehicle for integrating Anthropic’s AI models. The US has just declared Anthropic a supply chain risk for US companies, so will Palantir break UK workflows that are using Anthropic? I am certain that President Trump would not allow British companies to control US defence datasets, so why are we allowing American ones to control ours?

I could go on about civil nuclear, telecoms infrastructure, subsea cables, quantum, space and drones, but I will stop there, and finish by looking at possible solutions. Technology sovereignty was a big theme at the Munich security conference, and the US-Europe trust gap was a yawning chasm following the shock realisation that we could not always count on the US as an ally. Technology sovereignty solutions that focus on technological leadership, such as in the Secretary of State’s definition, reflect the basic idea that if the UK leads on, say, protein folding then Google may be less inclined to switch off ChatGPT if we side with Denmark when the US tries to seize Greenland.

Whether I agree with that approach or not, it certainly resonates with the evidence that the Committee heard from witnesses in so many domains regarding how important it is for the science and business community to understand where the Government are seeking to lead, so that resources can be focused and skills built there. Can the Minister say whether the Government plan to decide which aspects of AI, quantum, space or bioengineering we will seek to lead in? AI is often thought of as having three layers: infrastructure, data and applications. Can the Minister tell us where in the AI stack we are aiming for control, leadership, sovereignty or whatever we want to call it? Also, does he agree that weak competition in the AI and digital sectors, caused by giant incumbents, reduces our ability to lead?

Open source is often cited as at least part of the solution to sovereignty. I am a huge advocate for open source, open interfaces, transparent code and standard protocols, which can reduce or minimise dependence. Despite the policy ambitions, three quarters of NHS trusts’ development teams do not use open source approaches. None of the AI models currently being deployed within the public sector is an open ecosystem; all are proprietary in nature. The Minister’s Department has sign-off on all significant IT procurement. Is open source a requirement of it?

Finally, can science diplomacy help us to negotiate technology sovereignty? A number of Members have raised the issue of collaboration. Can we build on our human capital strengths by collaborating and working with partners who have respect for our values, take collaborative approaches, and can share with us the financial capital needed to make our sovereign objectives a reality? Are we happy to share leadership, and perhaps sovereignty, with our allies?

--- Later in debate ---

[Kanishka Narayan]

The hon. Member is absolutely right to raise that point about a defence for cyber-security purposes. The Computer Misuse Act is being reviewed at the moment—the Home Office is looking at it—but, as I mentioned in Committee on the Cyber Security and Resilience (Network and Information Systems) Bill, that is not the appropriate vehicle, given its much narrower scope than the broad scope that we would like in the context of a defence. For those reasons, I am keen that we pursue the matter, but elsewhere.

I am conscious of time, so I will proceed at pace. Alongside quantum and AI, semiconductors are another technology that underpins the global economy and is fundamental to our way of life. As part of our industrial strategy, digital and technology sector plan, we are taking measures to foster the growth of that particular sector.

My hon. Friend the Member for Mansfield (Steve Yemm) spoke very thoughtfully about the fact that we should not just rely on venture-focused companies in particular parts of the country, but look at our industrial heritage. That is exactly why I have focused on ensuring that the AI growth zones programme puts data centres in the north-east, alongside the headquarters of our largest listed tech company. A deep heritage of financial services technology innovation in Newcastle and the surrounding area is now able to benefit from good jobs anchored by that data centre.

In south Wales, the data centre planned for the site of the old Ford car manufacturing plant gives hope for jobs in the semiconductor cluster, anchored by that data centre. That is critical. In north Wales, data centres are pulling our nuclear small modular reactor into the future, which is critical to thousands of jobs in that community. In Lanarkshire, the old steelworking community, which lost thousands of jobs and never fully recovered, now has hope from half a billion pounds of community investment as a result of data centres. That is precisely what I believe in.

[Anneliese Dodds]

In one sentence, will the Minister say something about another geographical issue: collaboration with like-minded countries, especially in the EU?

[Kanishka Narayan]

I will simply give a note of total affirmation on the importance of that. Having met a series of Ministers from Europe, I know that we have a huge amount in common and a huge amount to do in the future.

I am being tested pretty intensively on time, so I will focus on one final point. Some Members rightly raised the question of mergers, acquisitions and investment controls. As my hon. Friend the Chair of the Select Committee will know from the time that I worked for her on the Bill as it was proceeding through the House, the National Security and Investment Act 2021 is an excellent example of where we are ensuring that investment and sensitive areas maintain the national security interests of Britain now and in the longer term.

In summary, the Government will continue to support our tech sectors as best they can. Only yesterday, Nscale raised the largest series-C funding round in all of Europe. Isambard-AI has raised a £50 million round for embodied AI—manufacturing AI—as well. Those are testaments to the approach that I have set out, which will ensure that British firms and people can seize every opportunity they can in tech-enabled Britain.