After DSIT  Where does UK tech policy go from here?

While the Government argues that embedding technology across departments rather than being siloed will allow it to better “align with [the] core economic and social agenda”, underpinning productivity, public services and economic growth, others worry it risks fragmenting responsibility for one of the UK’s most strategically important policy areas.

Why DSIT existed

Before 2023, responsibility for science, innovation and technology was dispersed across Whitehall. DSIT was created by then Conservative Prime Minister Rishi Sunak to draw these areas together, and signal that they had become central to the UK’s long-term economic strategy.

The department quickly became a recognised ‘single front door’ for the tech sector. It brought together expertise that had previously been scattered across government and attracted specialists from industry. It went on to oversee the creation of the AI Safety (now Security) Institute (AISI), launched (and delivered many commitments from) the AI Opportunities Action Plan, and more recently house initiatives such as the Sovereign AI Unit and the AI Economics Institute.

As with any government department, DSIT had its challenges. Establishing a new department required significant organisational change, recruitment took time and delivery has not always been effective. Yet after three years, many industry figures agree it had built an all-important institutional focus.

DSIT sent a clear signal that the UK regarded science, technology and innovation as foundational to a more productive, competitive and resilient economy.

What has changed?

With details yet to be cemented, the Government has redistributed DSIT’s responsibilities according to different policy objectives. It is still unclear as to the consultation process behind the decisions.

DSIT has been split across three different departments: science and innovation now sit within the ‘beefed up’ Department for Business, Innovation, Science and Trade (BIST) under Jonathan Reynolds MP, digital skills, online harms and digital inclusion return to a likewise expanded Department for Digital, Culture, Media and Sport (DCMS) under Lisa Nandy MP, and AI strategy, public sector AI adoption and AISI have shifted into the Cabinet Office inside a new Office for the Prime Minister and the Cabinet (OPMC), supported by a new prime-ministerial AI Taskforce chaired by Sir Patrick Vallance. There is no longer a dedicated tech secretary.

Skills England, including its work on AI skills, will remain in the Department for Work and Pensions (DWP), and the National Centre for Cyber Security (NCSC) will also remain in GCHQ.

We welcome AI Minister Kanishka Narayan’s elevation to a Cabinet-attending role (jointly across BIST and the Cabinet Office). Despite him no longer having the heft of a dedicated department behind him, including budget and delivery capability, we hope that this sends a strong signal that AI and technology should be at the heart of the new Government’s agenda.

Taken together, these changes suggest a shift in the Government’s broad approach to tech policy. Rather than treating technology as a policy area in its own right, it is now being framed as something that should underpin economic growth, industrial strategy and public service reform across government. Whether these changes prove productive, however, depends on delivery and next steps.

The opportunities

There is understandable logic behind the new arrangements.

For years, the IoD has argued that technology policy should not exist in isolation. Economic growth depends not simply on developing new technologies, but on commercialising them, scaling innovative firms and helping businesses across sectors and sizes adopt them successfully.

Bringing science, innovation and business policy together could strengthen that journey from research and innovation to growth. Likewise, positioning AI closer to the centre of government may make it easier to ensure that AI policy coordinates more effectively with other policy areas including energy and employment.

Technology alone cannot drag the UK out of the longstanding productivity challenge in which it’s been stuck. Tech can be a growth engine, however, but that engine needs to power every sector. Drawing business and technology closer together, moving away from a focus on only the tech sector, makes sense.

This might also expedite progress towards the kind of cross-cutting AI regulation that many argue businesses and people need to be able to trust, and therefore adopt, technology like agentic AI.

For businesses, particularly those outside the tech sector, these changes could ultimately prove beneficial if they result in better alignment between innovation, investment, skills and industrial policy.

The risks

However, the restructuring also carries significant risks.

The first is fragmentation.

AI is an expansive and ill-defined policy issue (if it can be labelled as one policy issue at all). It touches skills, infrastructure, cybersecurity and public services, among many other areas.

One of DSIT’s advantages was that it could consider these altogether. Now, responsibility is spread across multiple departments and ministers. That inevitably raises questions about who ultimately owns the UK’s overall tech and innovation strategy, and who has the authority to resolve competing priorities.

At a time when countries around the world are accelerating investment in AI capabilities, digital infrastructure and frontier technologies, any loss of momentum in this area matters.

The second risk is loss of focus and prioritisation.

Large departments naturally prioritise urgent political issues. Business departments deal with trade negotiations, industrial disputes and major economic shocks. Culture departments oversee media, sport and online safety. The concern expressed by many across the tech sector and beyond is that science and technology could lose visibility within much larger organisations whose ministers must balance many competing priorities.

The third challenge is the cost of reorganisation itself.

Machinery-of-government changes inevitably consume time, energy and resources. Beyond the visible expense of restructuring departments also lie less visible costs: uncertainty for civil servants, disruption to relationships, productivity losses, loss of institutional knowledge and the diversion of leadership attention away from policy delivery.

DSIT itself experienced many of these growing pains when it was first created. Just as those structures had begun to settle, they must reorganise once again.

Finally, there is the question of external confidence and uncertainty.

One of DSIT’s greatest strengths was symbolic as much as organisational. It demonstrated that the UK regarded technology as a strategic national priority. Investors, researchers and international partners knew where responsibility sat, with whom to engage and that the UK had a direction of travel. That clarity should not be underestimated.

For business, delivery matters more than departmental boundaries

Ultimately, organisational charts do not determine success, economic or otherwise. What matters is whether responsibility is matched with strategic direction, authority, resources and accountability.

The promotion of AI Minister Kanishka Narayan to a Cabinet-attending role is a welcome signal that AI remains a strategic priority. Likewise, there are clear advantages in bringing science and innovation closer to business, job creation and commercialisation.

However, those opportunities will only be realised if government can maintain the focus, expertise and momentum that DSIT had begun to build, while strengthening cross-government coordination.

For business, the real test will be whether government can deliver coherent policy, that gives firms and directors confidence, across responsible AI adoption (within the private sector, not just the public sector), digital skills, cybersecurity, infrastructure, regulation and innovation.

Businesses don’t care about Whitehall structures; they care about who will listen to them, whether government understands the barriers they face, whether there is a clear route into policymaking, and whether someone has the authority to act. DSIT provided an increasingly recognisable answer to those questions, but the new structure makes it less obvious where tech is concerned.

The UK’s challenge has never simply been producing world-class science. It has been translating those strengths into productivity, successful commercialisation and sustained economic growth. That challenge remains exactly the same today.

The machinery-of-government changes must be handled properly so that any gains aren’t outweighed by the significant costs of disruption. The priority now must be ensuring a smooth transition which strengthens, not slows, the UK’s ability to adopt, commercialise and scale the technologies that will stimulate greater private investment, accelerate the diffusion of innovation, and deliver sustained improvements in productivity and economic growth.

Moving forward, maintaining clear accountability, specialist expertise, credible mechanisms for cross-government coordination, meaningful engagement with business, and measurable delivery will be essential. We look forward to working with colleagues across government as new structures take shape.