Question to the HM Treasury:

To ask the Chancellor of the Exchequer, with reference to the Government's publication A pro-innovation approach to AI regulation, published on 29 March 2023, how much and what proportion of the budget of each regulator in their Department was spent on regulation of artificial intelligence in the latest period for which information is available; how many staff in each regulator worked (a) wholly and (b) partly on those issues in the latest period for which information is available; and whether those regulators plan to increase resources for their work on artificial intelligence.

The AI White Paper emphasised the importance of ensuring that UK regulators and public bodies have the capacity, expertise, and capabilities to implement government’s pro-innovation approach whilst recognising and understanding the risks. This is particularly true for those regulators for which AI falls squarely within their regulatory remit, but also applies to a much wider range of public and regulatory bodies considering the implications AI has across the economy, including the financial services regulators.

The Financial Conduct Authority, the Prudential Regulation Authority, the Bank of England in its regulation of certain financial market infrastructure, and the Payment Systems Regulator, are independent non-governmental bodies responsible for regulating and supervising the financial services industry. Although the Treasury sets the legal framework for the regulation of financial services, the regulators are responsible for developing and implementing rules, including relating to AI, and determining appropriate levels resourcing.

As part of the AI regulation White Paper consultation, the government is engaging closely with the regulators to understand the organisational capacity they need to regulate AI effectively, across technical, regulatory, and market-specific expertise.

I have asked the financial services regulators to respond to you directly on their resourcing for AI regulation.