The UK government has announced over £100bn in private AI investment since taking office. It says its AI sector grew 23 times faster than the wider economy last year. It says it’s “mainlining AI into the veins” of the British economy.

A Guardian investigation published this week suggests much of this is fiction.

The newspaper found that several large-scale datacentre investments — led by firms with ties to Nvidia — have been announced with great fanfare but lack basic documentation. In one case, a £1.9bn investment was announced with a press release claiming a contract had been signed. When the Guardian asked, the government acknowledged there was no contract in place.

In another case, the government said it was “not playing an active role in auditing these commitments.” The site of a promised supercomputer 12 miles north of London was, at time of writing, a scaffolding yard.

Former deputy prime minister Sir Nick Clegg and former Meta COO Sheryl Sandberg were recently announced as board members at one of the firms, NScale, which claimed a $2bn funding round days earlier. Whether that money is real is now a legitimate question.

Why This Matters

This isn’t just a UK story. The £500bn in AI investments promised globally in 2025 represents a wave of government-press release economics that deserves scrutiny everywhere. Big tech companies have every incentive to inflate job creation and economic impact to secure favourable treatment from governments desperate to claim a win in the AI race.

Professor Cecilia Rikap at UCL called it what it is: “phantom investments.” Big tech artificially inflating datacentre impact to please governments that are desperate to claim they delivered something.

The UK government rejected the Guardian’s findings and pointed to its broader growth figures. That’s not entirely without merit — some real investment has happened. But the specific claims about specific projects don’t survive scrutiny.

The Real Problem

The UK is not alone in this. Governments across the world are competing to announce the biggest AI investment numbers, and the incentive structure rewards announcements over outcomes. A press release costs nothing. A datacentre takes years.

What’s telling is the lack of basic oversight. The Department for Science, Innovation and Technology acknowledged it doesn’t audit these commitments. That means companies can announce whatever they want and face no consequences if it doesn’t materialise.

The broader context: Keir Starmer claimed AI could bring £47bn to the UK economy each year if “fully embraced.” That’s probably not wrong — AI will deliver significant economic value. But the value will accrue to the companies building it, largely American ones, not to the governments that posture around their press releases.

Sources: The Guardian investigation, UK Government AI Opportunities Action Plan