Investment and policy
Government policy on semiconductors is now framed primarily around AI hardware, backed by more than £1.1 billion of targeted investment announced in June 2026.
Last reviewed: 21 August 2026
The UK AI Hardware Plan, published by the Department for Science, Innovation and Technology on 8 June 2026, sets out how the Government intends to build UK capability in the chips and semiconductor technologies that underpin artificial intelligence. It is backed by over £1.1 billion and is organised around four pillars: innovation, skills, procurement and investment.
Its largest single element is a £750 million heterogeneous AI supercomputer for the AI Research Resource, able to combine conventional accelerators with novel AI architectures and, in time, quantum computing. A £400 million procurement opportunity for specialised chips sits within that programme — including an expanded £150 million Advance Market Commitment for next-generation inference chips, up from £100 million previously.
The figures below are nested rather than cumulative: the £400 million chip procurement and the £150 million Advance Market Commitment sit inside the £750 million supercomputer programme.
£750m
Procurement
A single system able to integrate different types of advanced compute, including novel AI architectures and, over time, quantum computing, used on real research workloads.
£400m
Procurement
Sits within the £750m AIRR supercomputer programme rather than being additional to it.
£150m
Procurement
An expanded Advance Market Commitment, up from £100m announced previously, to purchase novel high-performance inference chips. Forms part of the £400m specialised chip procurement.
£120m
Innovation
Includes an AI Hardware Innovation Programme designed with UK Research and Innovation (UKRI) and the UK Semiconductor Centre, an expanded Scaling Inference Lab and an £18m hardware security research programme.
£80m
Skills
Includes expansion of the semiconductor skills programme to £48m, a new £12m Centre for Doctoral Training in chip design and £20m of targeted TechFirst investment.
Around £80 million is directed at skills, including expansion of the semiconductor skills programme to £48 million, a new £12 million Centre for Doctoral Training in chip design, and £20 million of targeted TechFirst investment. A further £120 million supports AI hardware innovation, including an AI Hardware Innovation Programme designed with UK Research and Innovation and the UK Semiconductor Centre, an expanded Scaling Inference Lab, and an £18 million hardware security research programme.
The AI Hardware Plan does not replace the National Semiconductor Strategy published in 2023; it narrows the focus onto AI compute, which is where global demand growth has concentrated. Where the earlier strategy set broad objectives on research, supply chain resilience and international collaboration, the 2026 plan attaches specific instruments — procurement commitments, doctoral training, an innovation programme — to a defined technology area.
Public money is intended to be catalytic rather than sufficient. The consistent theme in the 2026 sector study is that UK semiconductor companies find early-stage research funding more accessible than the large, patient capital required to scale hardware businesses — a gap that matters more in semiconductors than in software because physical capability, tooling and qualification cycles are expensive and slow. Advance Market Commitments are a direct response: guaranteed demand reduces the commercial risk of building capability in the UK.
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