00:00Texas State, thank you very much indeed for your time.
00:04What would success look like for you when it comes to the UK and the UK's AI ambitions in two,
00:10three, four years' time?
00:12What is the potential there?
00:14We're in a race for this AI future, and I want Britain to win.
00:20I'm not naive. I would count myself as an optimistic realist.
00:25I'm not running the same race as America or China, but I believe there are races that Britain will win
00:32on,
00:32which is why we've made this huge announcement this week about backing British AI hardware companies.
00:40Someone said today, you know, whoever wins on compute wins the race.
00:44You know, it's the absolute power engine of AI, and you're not going to get better biology or financial services
00:51or logistics services unless you have the very best chips.
00:55And we know that although some people think the market's sewn up, it's not.
00:59It's diversifying, and we have incredible potential there with our great British talent and great British innovators.
01:06And this government is going to bet on Britain because we believe in Britain and because we believe that we
01:13can win this race in these new chips.
01:15And that's why we put this £1.1 billion investment into AI hardware during London technology.
01:22I spoke to an investor yesterday, and she said we need the most ambitious political agenda since the Second World
01:27War to ensure that we have a seat at the table when it comes to AI.
01:32I think she's absolutely right.
01:35I mean, we're going to see the equivalent of the Industrial Revolution, but in a decade, and we are in
01:41this race for the future, and we're determined to win, to win for Britain.
01:45And that point about having a seat at the table, I would go even further.
01:52You know, if you want to have greater sovereign control over this increasingly powerful technology, that's not about isolationism or
02:01pulling up the drawbridge and attempting to go it alone.
02:04It's about becoming a kind of keystone in the global tech architecture.
02:09So you become an indispensable partner.
02:11I don't just want a seat at the table.
02:13I want Britain to be an indispensable partner.
02:16And I think this race on compute and the AI hardware of the future is absolutely critical to do that,
02:24which is why we've put such a focus on it during London Tech Week.
02:27What more can you and the government do to accelerate the build-out of data centres and the energy needed
02:33to power them?
02:34These are critical issues.
02:35Look, we have already set up new AI growth zones to the data centres, but also, crucially, the support for
02:43local businesses and upskilling of people in the local workforce in North Wales, in South Wales, in the Northeast, and
02:50in Lanarkshire.
02:51You know, a place that was the beating heart of Scotland's industrial revolution, now leading the technological revolution.
02:58And, you know, in North Wales, we've combined that data centre with three small modular nuclear reactors to power it.
03:06The clean energy powering the AI revolution.
03:10And in Lanarkshire, it will predominantly be powered by clean Scottish energy.
03:15So, we are taking action, both to get those data centres built, but also to provide the clean, sustainable energy
03:22that they need.
03:23What's the biggest impediment?
03:24Is it energy costs?
03:26Is it unpicking the regulatory network?
03:28Well, it's also just about turbocharging planning decisions, which is why we've put data centres further up the priority list.
03:38Because, look, you know, data is the engine of the economy now.
03:42We've got to treat it as much a part of the infrastructure as the roads and the railways.
03:47So, we're making those planning decisions, driving that forward more quickly.
03:51We're combining it with the clean energy and big developments like nuclear.
03:55That is how we secure our position, because we need to build those data centres and quickly.
04:00How do we ensure that the value of some of the start-ups that are starting to grow at rapid
04:05pace in the UK accrue to the UK public?
04:08I think the companies are at Revolut, most of that upside is going to go to their US investors, not
04:13to the UK public.
04:14So, that is why we have said we want a decisive shift to backing more British AI companies.
04:21It's why we've launched Sovereign AI, £500 million, to back British AI companies, combined with action to unlock wider support
04:32from the state.
04:32Whether that's super priority visa decisions, free R&D, free access to our supercomputers, or critically, unlocking access to government
04:41procurement.
04:43Don't forget the billions of pounds government spends in the NHS, in defence, that we want to see invested in
04:49British companies.
04:50We want them not just to start up, but to scale up and stay in the UK, which is why
04:55our announcement on Sovereign AI, on procuring the first large usable quantum computer.
05:03We've got a £1 billion quantum big bet on that, and our AI plan, all about investing in those companies,
05:10saying the government backs you, will unlock the talent, will unlock the wider support,
05:14because we want you to start up and scale up and stay in Britain.
05:18Are those tech startups now offering the returns that make them attractive for UK pension funds?
05:23Well, I'm sure you'll see more very soon, because on the issue of pension funds.
05:29You know, when I was Secretary of State at DWP, I introduced the Pensions Bill, now the Pensions Act, which
05:36is about trying to unlock more institutional investment into UK PLC.
05:42I'm sure you'll see more movement on that very soon, because that is one of the things investors always talk
05:47about.
05:47Secretary of State, do we need a cultural and societal mindset shift when it comes to risk-takers and wealth
05:54creators and celebrating that?
05:56I mean, I think government needs to take more bets, to bet on Britain's future, to bet on the industries
06:04that we believe we've got real strengths in.
06:06You know, that's what we're doing on Sov.ai and hardware.
06:11We're saying, look, we believe this is something Britain has strengths in.
06:14I often compare it to the Olympics, you know, where, for those of your viewers old enough to remember, we
06:22were absolutely terrible in Atlanta in 1992, came 36.
06:26And then we said, enough.
06:28Then we progressively, we backed our best sport, we got those best teams, we put more resources in, we backed
06:34them, and then we were second in the medal table.
06:37You know, I'd like to be first.
06:38I actually want to win gold medals.
06:40But I think that's the approach this government is doing, is a more active government, a more muscular government that
06:47takes bets on where we think Britain is great.
06:50Are you looking at making equity compensation more attractive for founders and their teams?
06:55Well, look, Sov.ai is actually putting equity investment into brilliant British AI startups.
07:03We're not just putting them...
07:03They need to be able to compensate their staff and try and match what we're seeing in the US.
07:06We are also changing things like all sorts of incentives to help more workers take a share in those companies,
07:14to give them a stronger incentive to list here in the UK.
07:18All of the announcements that the government, that the Chancellor made in her last budget.
07:23I think you're seeing a government that wants to play an active role doing what government can, change the circumstances,
07:30invest where we need to, unlock wider government support, so we turbocharge this fantastic industry.
07:36The Bank of England governor recently said that we may get to a point where we have to ration AI
07:40because of our energy constraints.
07:42How likely is a rationing of AI?
07:44I don't want to see any of that happening.
07:47We want to make sure that our brilliant companies who are working in life sciences or materials chemistry or financial
07:54services or professional and business services be able to actually access those AI models and power that they need to
08:02transform their businesses.
08:04I think that's the really important part here.
08:06How do we actually turn this powerful technology into practical models businesses can use, not just to save time, vital
08:16though that is, from like red tape and bureaucracy, but how they actually transform their business processes.
08:22And we are determined to make that available for every company in the UK.
08:26Will your government be banning social media for under-16s?
08:29Well, we are, as you know, you wouldn't expect me to announce this on Bloomberg television, fantastic though you are.
08:35Any announcements will be made to Parliament.
08:38But we, the question isn't if we're going to act, it's how, you know, because so many people, so many
08:43parents are worried about this issue of social media.
08:46How would a ban work in practice?
08:48What would be included, what would not be included?
08:49Well, you're tempting me to say something that we haven't yet announced.
08:53All I will say this is we have been overwhelmed, especially by parents who are struggling with these issues every
09:00day.
09:01You know, like when to give your child a phone, what are they looking at, how much time should they
09:06have, have we got the right controls on, what are they seeing online, are they safe?
09:11I think parents want to do the right thing, but they're crying out for help, and that's what the government
09:16intends to deliver.
09:16What would you define as social media?
09:18Well, there are all sorts of different definitions in Australia.
09:21They've looked at user-to-user sharing, plus algorithms and content creation.
09:28That's the definition they've used.
09:29We've looked at lots of other things, too.
09:31When we come forward with our proposals, we will spell the details out, but we want to make sure that
09:38kids are prepared for this life online, because they will face it, but we want to do more to keep
09:42them safe.
09:43I think we need a significant shift to reset that, and we'll be coming forward with that proposals in a
09:49minute.
09:49And your message to the Trump administration that is opposed to this kind of ban would be?
09:52I'm not interested in sending a message to Donald Trump.
09:55I am interested in sending a message to the British people, which is, we want to back parents.
10:00I know you're crying out for help and support with this, and this government is determined to deliver.
10:05Secretary Seuss, thank you very much indeed.
10:06Pleasure.
10:06Thank you for your time.
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