AI assurance market could generate over £18bn a year for the UK economy by 2030

In a paper published by the Social Market Foundation and UK Day One Project, analysts from the Institute for AI Policy and Strategy (IAPS) claim that fostering a thriving ecosystem of UK-based firms focused on the safety, security and reliability of AI products could unlock over £18 billion a year by 2030. With the new Labour government having pledged to use industrial strategy to drive up the country’s growth rate to the highest in the G7, the authors argue that AI assurance presents a substantial economic opportunity.

Existing AI systems have significant reliability and security issues, leading to slow adoption  due to “concerns about data security, biased algorithms and hallucinations”. AI assurance technology (AIAT) has the potential to make AI systems more reliable and secure, hastening AI adoption and securing AI-led growth.

The AI assurance market itself has significant growth potential. If the UK were to capture 8.5% of the 2030 AIAT market (similar to its current share of the global cybersecurity market) companies could be earning almost £18bn in annual revenue by 2030. Given the UK’s world-leading AI Safety Institute and fledgling AI assurance start-up scene, the country could potentially capture an even higher fraction.

At present, however, potential AIAT companies face three major challenges in finding success in this market:

1. Uncertainties about the future regulatory environment around AI, both domestically and internationally, making it harder for companies to set R&D priorities.
2. Uncertainties about prioritisation, e.g. what assurance solutions will be most useful for businesses looking to capitalise on AI-led growth.

1. Risks associated with uneven demand, like investing in R&D for specific technologies where demand is presently weak.

With the right policies in place, the UK government can address these challenges, resulting in far more private investment flowing into this sector and more start-ups springing up in the UK.

To that end, the Secretary of State for Science, Innovation and Technology should announce a “market-shaping programme” focused on mobilising public and private sector investment into key AI assurance technologies. A well-publicised announcement will signal to businesses, investors, and researchers that the government regards AI safety as a priority, thereby boosting investment confidence.

The authors then lay out a 5-point plan for their market-shaping programme:

1. Establish an inter-departmental group to guide AI assurance policy.
2. Develop a three-year roadmap for introducing mandatory AI assurance standards, agreed with the EU and US.
3. Direct £10m of the AI Safety Institute’s existing budget into funding for priority AI assurance technologies, and grant companies developing said tech free access to public compute.
4. Commission a study analysing the technical and market barriers to developing and commercialising priority AI assurance tech.
5. Invest £50m in pull mechanisms (rewarding entities after they meet specific goals) for AIAT. The Department for Science, Innovation and Technology should seek support from private donors to match public investment for these pull mechanisms.

Jam Kraprayoon, of IAPS and author of the report, said:

“AI presents huge opportunities for the private and public sector, but concerns about reliability, security, and transparency are holding back adoption. AI assurance tech is a key part of the solution here. Assurance leads to trust, trust leads to adoption, and adoption leads to innovation. The UK government can catalyse a world-leading AI assurance industry through a targeted market-shaping programme, stimulating major private-sector investment and growth.”

David Lawrence, of the UK Day One project, said:

“AI assurance offers a win-win for the UK. It means safer model development and higher levels of public trust, while offering a huge opportunity for growth, building on the UK’s existing strengths in AI development, testing and evaluation. The new government has made economic growth one of its core missions. Responsible development of AI technology will be essential for the UK’s growth prospects, affecting public service delivery, education, automation and worker productivity.”

Notes

1. The paper, Assuring growth, will be published at https://www.smf.co.uk/publications/assuring-growth-ai-uk-leader/ on Thursday 11^th July, 2024.
2. About the authors:

1. 1. Jam Kraprayoon is a Researcher on the Policy & Standards team at the Institute for IAPS. Prior to IAPS, he was a manager at the Effective Institutions Project and a program officer at the Asian Productivity Organization, where he focused on public sector reform, regulation, and strategic foresight. He holds an MPhil in Politics from the University of Oxford and a BSc in Government from the London School of Economics.
   2. Bill Anderson-Samways is a Research Analyst on the Policy & Standards team at the Institute for AI Policy and Strategy (IAPS). He was previously a researcher at the Social Market Foundation, a Westminster think tank, where he focused on climate policy. He holds an MPhil in Anthropocene Studies and a BA in Politics and International Relations, both from the University of Cambridge.
2. The report is sponsored by commissioned by UK Day One Project, and published by both UK Day One and SMF.

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