UK finance minister seeks AI, quantum funding boost as part of EU trade ties

Finance minister Rachel Reeves said on ​Tuesday that Britain wanted to align more closely with the EU on business regulations and would boost funding for quantum computing and artificial intelligence in a bid to generate elusive economic growth.

Britain's Labour government has sought a reset with the ‌EU and has become ⁠more forthright ⁠in its criticism of the cost of Brexit, while maintaining its red lines on not rejoining the bloc's single market or ​customs union.

Setting out closer EU ties as one of three pillars of her economic plans, Reeves said Britain would ​align with EU rules where this served the national interest, and while regulatory autonomy may be needed in some areas, "that should be the exception, not the norm."


"When the economic gains exceed the cost, the trade-off ​is worth making," Reeves said in a speech at the Bayes Business School ⁠in London.

Reeves says EU, AI and regional growth are key

Prime Minister Keir Starmer wants ​to reduce post-Brexit barriers ​to trade and cooperation with the EU, though he has ruled out rejoining ⁠the single market. Talks are instead focused on regulation and freer movement ​for young people.

Reeves said that "no partnership is more important than that between ​the UK and our European neighbours," and that she was prepared to "make and win the political argument" for alignment.

"I believe absolutely that closer alignment is the right course for our country: a course chosen as a sovereign nation."

Reeves and Starmer pledged before the 2024 election to accelerate Britain's sluggish economy, but growth remains weak and could falter further due to fallout from the conflict in the Middle East.

Reeves said ‌decisions taken in her first two budgets had left Britain better placed to face the latest economic shock, but argued the state needed to play a more active, ​strategic role in supporting ​future industries.

She said the ⁠government would spend up to 1 billion pounds ($1.33 billion) on powerful quantum machines capable of working on multiple possible solutions simultaneously, speeding innovation in areas such as medical diagnostics, greenhouse gas monitoring and secure communications.

Pitching to AI firms, Reeves said the 500 million-pound "Sovereign AI Fund," announced last year, would be launched in April to help British artificial intelligence companies.

She added that the government would consider giving regions greater control over tax revenues and would back new rail and housing projects in the arc between Oxford and Cambridge, using compulsory land purchases if necessary.

($1 = 0.7514 pounds)