Recommendation 5

DSIT and Cabinet Office have a long way to go to strengthen government’s approach to digital procurement to ensure value for money and a thriving AI supplier market. The technology market is rapidly evolving with a shift from upfront capital purchases to subscription–based models, and greater consolidation of the supply chain. Technology suppliers, charities and academics have raised concerns with us that the dominance of a small number of large technology suppliers in the AI market risks stifling competition and innovation. We also heard concerns that government procurement approaches are ill–suited to a dynamic, fast–paced market, increasing risks to value for money from vendor lock–in and the inability to adapt and take advantage of rapid technological development. The government is aware it has a lot to do to adapt its procurement approach to keep up with the pace of change in the sector, and to leverage its significant buying power. It has committed to setting up an AI sourcing and procurement framework, including rapid procurement and national tenders where appropriate. It has also confirmed it will establish a digital commercial centre of excellence to deepen its expertise. The success of these measures will be critical if we are to see a vibrant AI market in the UK and value for money in the procurement of AI for the public sector. recommendation DSIT, in collaboration with Cabinet Office, should set out publicly how its proposed AI sourcing and procurement framework will: • get the best from all suppliers in a market dominated by a small number of global technology companies and ensure opportunities are available for small suppliers • align with the overarching digital technology sourcing strategy (on how government builds, buys and partners) that the Blueprint for modern digital government promises • leverage government’s spending power to achieve value for money for citizens • Ensure those taking procurement decisions across government have access to the