There is little doubt that AI will change the course of human progress, much like previous general-purpose technologies that dramatically reshaped the world around them. But unlike past waves of change, much of the foundational infrastructure for AI is already in place: the internet and data, cloud and storage, chips and compute. The scope and scale of change will be vast. And it will come quickly.

The private sector is already making historic investments in its future. With chips and data centres, leading tech companies are building infrastructure that surpasses 20th-century mega-projects such as railroads, dams and even space programmes. But across the corporate world leaders all face a choice: invest in AI capabilities or risk perishing.

For governments, the choice often feels less stark. Political leadership may change, but the state still exists. Like all well-established organisations, the state has a bias towards caution. But this is an illusion – a failure to modernise, reform and deliver is a perilous course for a nation and those who govern it. And this is particularly true in the case of AI, which if gripped properly, should make today the most exciting and creative time to govern.

In writing this paper, we are coming at this issue from both perspectives. One of us is a politician and runs an Institute advising government leaders, while the other is a leader of a technology company. We both understand the magnitude and the necessity of the choice. We both also see the potential prize for the UK, which should have its own ambitions to position itself at the forefront on AI and provide leadership on governing in this new era.

And when both of us survey the operations of governments from our different perspectives, we see the same opportunity: almost everywhere AI can help us reimagine the state. Many of the countless daily tasks in government are repeatable processes carried out on a mass scale.

Almost all of these can be made better, faster and cheaper. As this paper lays out, the scale of this opportunity is huge: with the technologies and the digital infrastructure we have today, we estimate that up to £40 billion can be saved each year with the technology as it exists now. But, of course, over time, this technology will accelerate dramatically in its capability, and so will the savings.

This is much more than a debate around the margins of tax and spending; it has the potential to transform the costs, functions and accountability of government.

At a time when government is unwieldy, expensive and slow, AI can save our public services, making them more personalised and human-centric.

Safe, explainable AI systems can make government fairer and more transparent, liberating and empowering people. We shouldn’t be afraid of blocking systems that don’t meet these standards, but we must rapidly embrace those that do. They can make government more strategic in how it approaches complex decisions about the highest-stakes issues, with more accurate, more granular, more up-to-date information and insights.

And this is only the beginning of what AI will be able to achieve. The pace of development and the new capabilities announced each month make it clear that the current generation of AI systems only give us a glimpse of their full potential. This is the least able AI will ever be.

To access this opportunity, government will need a coordinated strategy to put in place the necessary infrastructure, sovereign capability and skills. It will need to invest in making the right data across departments interoperable, while maintaining privacy. It will need to train its own models where necessary, such as for national-security purposes, fine-tune custom tools and build or procure applications on top of existing models. It will need to secure the computing power necessary for AI to run at scale, for everyday use as well as research purposes. And it will need to change how it hires and trains AI specialists.

None of this will be possible without working in partnership with the private sector. The computing requirements of AI mean that close coordination and cooperation with leading providers are required. The UK is also itself home to many leading AI companies. With the talent that we have, it should be home to many more in the future. The government will play a crucial role in fostering this industry if it makes the right choices and clearly demonstrates what AI can help us achieve.

For those of us in both the public and private sectors, the choices that we face today are critical for our futures. Businesses which fail to adapt to this new world will be quickly replaced by competitors. For countries, the failure is bigger – harming people’s prosperity as well as their nation’s place in the world.

The prospect might seem daunting, but for the most part investing in AI is low-risk, high-reward. Its benefits, as this paper shows, far exceed the costs – and the price of inaction may be higher still.

Tony Blair, Executive Chairman, Tony Blair Institute

Marc Warner, CEO, Faculty

Read the full report by the Tony Blair Institute and Faculty here.

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