Monday Morning Moan - why is the UK Government at war with its own beliefs regarding tech regulation?

Whatever you think of various governments, you could at least rely on them to have a set of beliefs when it came to innovation and new tech. Today, despite loud claims otherwise, not so much.

Regulating emerging technologies is a massive challenge for governments, as it means preparing the ground for events that haven’t happened yet; for both societal solutions and societal harms. This is particularly true for a British government looking to seize Brexit opportunities after the fact.

On that point, a quick history lesson (bear with me; its relevance will become clear). 

From our standpoint today, few would claim that Whitehall planned ahead for leaving the EU. In 2016, so-called ‘Re-moaners’ were accused of whipping up ‘Project Fear’, but most enterprise leaders would recognize their warnings as mere scenario planning – ‘what ifs’ that demanded forethought and remedy. 

The complete absence of Brexit strategy and operational detail in Whitehall has been explained by recent revelations, in documentaries such as the BBC’s State of Chaos, that the Leave campaign never expected to win. It was an internal point-scoring exercise – gamesmanship that somehow lifted the cup, backed by big personalities more than common sense. 

Cue years of administrative panic that, in the words of one peer of the realm, left the government – every department and every decision – “impaled on Brexit” for the foreseeable future: unable to move, with neither the time nor resources to escape the problems it had caused itself.

So, what has all this got to do with technology? Everything, now that the dust is settling and Britain finds itself in the new world it claimed it wanted, but somehow neglected to plan for.

In 2023, the UK Government wants Britain to be a technology “superpower”, given its strengths in Artificial Intelligence, robotics, fintech, engineering, autonomy, quantum computing, and more. A noble aim, with evidence of UK leadership in Europe to back it. Start-ups abound, backed by significant venture capital. That’s impressive, and we should say so.

So, might better, post-Brexit regulation help its ambition? It depends who you ask.

Bonfires burnt out

As my previous report revealed, the UK Government’s backbench-focused promise of a bonfire of EU red tape is now, slowly, morphing into something rather different – and certainly more pragmatic and realistic: simply asking businesses what problems EU regulations cause. Yup, that ‘bonfire’ was just another soundbite.

But while there are real opportunities for smarter, more innovation-focused regulation – the government has tasked its regulators with being commercial enablers more than citizen protectors – there are problems. And the biggest of those is: what belief system might those regulations represent? 

The answer is far from clear or simple, as I will explain.

This November, the UK is hosting a Summit on safe, ethical, and responsible AI – good news. But as our report earlier this month revealed, it has not even considered critical issues such as copyright and IP in its call for evidence, a concept that underpins many successful industries. Sectors it would be wise not to undermine.

Despite these oversights, senior Cabinet figures have been standing on the world stage warning about the dangers of AI, even as the UK wants to seize that technology’s advantages. A confusing message if ever there was one.

While Prime Minister Rishi Sunak busied himself rolling back climate pledges and stripping away imaginary rules – a bin-fire of the vanities – Deputy Prime Minister Oliver Dowden delivered a speech on AI to the UN. In it, he said:

The starting gun has been fired on a globally competitive race in which individual companies, as well as countries, will strive to push the boundaries as far and fast as possible. In the past, leaders have responded to scientific and technological developments with retrospective regulation. But in this instance, the necessary guardrails, regulation, and governance must be developed in a parallel process with technological progress. Yet, at the moment, global regulation is falling behind current advances.

Britain’s solution? Wresting greater control over AI from tech firms through smart – and in a sense, predictive – regulation, to anticipate societal harms. So far so good, you might think.

Another ambitious and sensible aim, in fact; but of a type that the UK has a lamentable track record in delivering (see Brexit). And it wants to achieve this from its new, post-Brexit position as semi-detached from every major economy – a “buccaneer” on the high seas, no less.

So, can the UK lead the world on these issues? Certainly, it has an excellent track record in AI, but the British economy may no longer be the attractive place for emerging tech that it once was, even as recently as last month. At least, not according to Matthew Feeney, Head of Tech and Innovation at the Centre for Policy Studies.

For anyone assuming that he is some – in tabloid speak – woke Re-moaner or academic undermining the patriotic cause, bear in mind what the Centre for Policy Studies is - a neo-liberal thinktank founded by Margaret Thatcher. In other words, exactly the type of organization that successive governments have tried to appease since the 2008-09 financial crisis. (Feeney tells us he was pro-Remain and considers himself 'woke' on matters of race, policing, and immigration.)

Speaking at a Westminster Business Forum this week on regulating new technologies, Feeney initially sounded upbeat and positive, welcoming No 10’s stance on AI and other emerging technologies:

I think that the current government rhetoric on technology is good. There is widespread acceptance in the government that the UK has a lot of comparative advantage when it comes to technology, and AI in particular. The Government, I think rightly, boasts the number of unicorns in the country.

But then he said:

However, I think there are three buckets of challenges that I'd like to highlight. The first is there is a widespread worry about post-Brexit regulatory divergence.

Yes, you read that right: a neoliberal thinktank is warning against the very thing that recent neo-liberal governments have been shouting from the rooftops. 

Feeney continued:

This has been highlighted in a number of industries, driverless cars being just one example. [It would certainly help the concept of personal transport if next-generation cars could actually go outside the UK!]. 

A lot of the campaigners for Brexit were quick to highlight how great it would be to be outside of the EU, and to engage in deregulation for a lot of industries. But of course, deregulation in some sectors imposes new costs – on firms that are going to have to navigate a number of new regulatory regimes.

Do try to keep up: now a neo-liberal thinktank established by Margaret Thatcher is warning against deregulation! Extraordinary. But Feeney was just getting started:

The second issue, unfortunately, is a lot of new government legislation at this point is empowering regulators in a way that is frightening a lot of tech investors, entrepreneurs, and market incumbents. 

One is the Online Safety Bill. A good example of a kind of Bill that hands a huge task to a regulator, in this case Ofcom. Part of the problem is that the government is asking Ofcom to, effectively, police the internet for troves of harmful content, regardless of the context in which it appears. But this will involve Ofcom policing the internet in a way that removes a lot of legal and valuable speech.”

But wait, there was more:

Not to mention there's a lot of concern about the privacy issues associated with the Online Safety Bill. And although the Bill is widely discussed in the context of big California-based companies, it is going to affect tens of thousands of organisations and firms that have nothing to do with internet search or social media. And the end encryption concern – although the government might say it has headed this off – still remains.

Ouch. Or as one wag put it on Twitter – sorry, ‘X’ – this week, “If the road to Hell is paved with good intentions, the Online Safety Bill is a motorway.” 

So, what did Feeney think the net effect of this might be? He said:

I wouldn't blame international investors and entrepreneurs for looking at the UK with caution after the passage of the Online Safety Bill, given that it finished its final lap in the Lord's [this week].

If, at this point, you feel your grip on reality weakening, here’s a quick recap: a neoliberal thinktank is lambasting the flagship technology and legislative policies of three successive Conservative governments – including the none-more-neoliberal administration of Liz Truss (PM for 49 days – how’s that for fast moving!).

But he wasn’t finished yet:

And the other is the DMCC, the Digital Markets, Competition and Consumers Bill.  Here, again, we have the government throwing the regulator a massive task. The main concern is the Digital Markets Unit [within the CMA], which will have effective power to micromanage some of the biggest decisions associated with large market incumbents. There a number of issues associated with this Bill, but one I'd like to highlight is the relative lack of appeals, and the effect that this could have on innovation and growth.

No idea

So, it seems that successive neoliberal governments have no idea how to legislate and regulate new technologies. At least, in the view of one of their key policy pressure groups.  But did Feeney offer any solutions, or just overwhelming criticism? He said:

[We advocate] an environment where businesses are put in a position of asking for forgiveness rather than permission from regulators.

Stop sniggering at the back, Big Tech CEOs. He continued:

Regulators should be upfront, explaining what kind of likely and catastrophic harm – to life, limb, national security, and infrastructure – they aim to prevent. And make it clear that, absent those, technology companies are free to experiment.

In short, to hell with the concept of the UK government wresting control of AI, or any other technology, from Big Tech. Says a Conservative thinktank to the Conservative government whose aim is to do exactly that.

Got all that? Good. Does any of it make sense? No. 

Welcome to buccaneering UK, riding the high seas of… er… transparency?