The UK government is pursuing ambitious AI plans while leaving the underlying digital infrastructure in a vulnerable state, according to a new report from the House of Commons Public Accounts Committee. The committee's chair, Sir Geoffrey Clifton-Brown, said AI is approaching government like a tsunami and questioned whether Whitehall is ready. The report highlights a persistent skills gap: just 6 percent of civil servants work in digital and data roles, well short of the 10 percent target, and senior specialists are especially scarce.
The same report warns that legacy IT systems are a serious cyber security risk and prevent departments from benefiting from newer technologies. Fraud and error already cost taxpayers an estimated £55 billion to £81 billion annually, and generative AI is giving fraudsters more sophisticated tools. The Department for Work and Pensions overpaid £9.9 billion in benefits in 2025-26, with a plan to reduce that only modestly by 2028-29, while the Home Office and Ministry of Justice spent around £4.9 billion on asylum in 2024-25 amid calls to scrap AI asylum tools over accuracy and oversight concerns.
The report contrasts two major IT projects. National Savings & Investments began a system overhaul in 2020; by December 2024 the cost had reached £3 billion, £1.3 billion above the original estimate, and the project has been rated red since 2022-23. By comparison, the Bank of England completed its Real-Time Gross Settlement system upgrade for £431 million in April 2025. The PAC directed its recommendations at Whitehall rather than the Bank, suggesting the government could learn from the successful project as it tries to modernize the systems it already runs.