The UK Government has launched a £100 million programme designed to help British AI startups develop technology for major public-sector challenges.

The new Sovereign AI R&D Procurement Scheme will allow government departments to become early customers for promising UK AI companies, helping startups move from prototypes to real-world deployment.

The first four competitions will focus on NHS productivity, AI computing efficiency, defence technology and AI agent cybersecurity. The government says the programme is intended to strengthen Britain's domestic AI capabilities while helping companies scale in the UK.

The scheme also aims to address a common problem for smaller technology firms: winning government contracts can be difficult without an established track record or significant financial resources. The new programme removes some of those barriers and can provide upfront payments where appropriate.

Successful companies will retain ownership of the intellectual property they develop, giving them the opportunity to commercialise their technologies beyond government projects and potentially expand into international markets.

The move places UK AI startups at the centre of a new government strategy focused on sovereign technology, public-sector innovation, cybersecurity and the expansion of Britain's AI economy.