UK scraps dedicated tech department in Burnham reshuffle
Prime Minister Andy Burnham has abolished the UK's dedicated science and technology department, raising concerns among investors that bureaucratic disruption will delay the country's artificial intelligence strategy.
Prime Minister Andy Burnham has abolished the Department for Science, Innovation and Technology, merging its remit into a broader business department. Jonathan Reynolds was appointed secretary of state for business, innovation, science and trade to lead the newly combined entity. The structural shake-up was confirmed today, alongside the appointment of former defence minister John Healey as chancellor.
The dissolution of DSIT removes a dedicated Whitehall pillar that was specifically designed to navigate the commercial and regulatory complexities of the modern tech sector. Created in 2023 under former prime minister Rishi Sunak, the department centralised responsibility for artificial intelligence, digital regulation and broader scientific innovation. It served as the institutional anchor for the UK's AI Opportunities Action Plan, the expansion of sovereign AI compute infrastructure, and the AI Security Institute.
For investors and tech executives, the immediate concern is administrative disruption. The closure prompted a swift backlash from startup founders, investors and tech policy leaders over the weekend. Several warned that another reorganisation would consume valuable time and bureaucratic bandwidth. That is time the market argues would be better spent delivering on the UK's stated AI and digital ambitions rather than managing internal government restructuring.
Reynolds returns to the business brief after previously leading the Department for Business and Trade from 2024 until September last year, prior to his stint as chief whip. He now inherits a sprawling portfolio that folds cutting-edge technology policy into traditional trade and commerce. Under the previous administration of Keir Starmer, these functions were split, with Peter Kyle leading the business department and Liz Kendall overseeing DSIT.
Market participants will now be looking for rapid clarity on how critical tech programmes will be managed under the new hierarchy. The continuity of AI regulation and the deployment of sovereign compute investments are key areas requiring immediate attention to prevent a loss of market confidence in the UK as a competitive tech jurisdiction.
