Whitehall’s ‘Buy British’ Tech Push Falls Short: Less Than £1 in £6 Reaches UK Firms, IPPR Finds

The UK government talks a lot about buying British technology. A report from the Institute for Public Policy Research (IPPR) suggests the reality is very different. Less than £1 in every £6 the public sector spends with its biggest technology suppliers ends up with genuinely British firms.

The headline figure looks far healthier than it is. IPPR found that 42.5 percent of spending with the public sector's 150 largest technology suppliers appears to go to UK companies. Strip out firms that are foreign-owned, employ most of their staff overseas, or simply resell products made by US giants, and that figure collapses to 15.4 percent.

The report, titled Locked In: A Realist's Agenda for Digital Sovereignty, was published on 11 November 2026. It warns that Britain's dependence on American technology could become a real problem if Washington ever restricts access to advanced AI systems. That warning, the researchers say, is no longer purely theoretical.

Resellers Take the Lion's Share

A large part of the problem is who sits between the government and the technology it buys. IPPR found that 43 percent of the spending attributed to UK-headquartered suppliers actually goes to resellers, companies that buy technology from someone else and sell it on.

Two resellers, Bytes and Softcat, account for around £2 billion between them, making them two of the three biggest recipients of public sector technology spending. Much of the money that flows through them ends up with the mostly American firms whose products they sell.

Once IPPR traced reseller contracts back to the companies behind the products, the United States emerged as the biggest beneficiary by a wide margin. The US takes £9.2 billion of the £19.2 billion spent with the largest suppliers, close to half of the total. Britain's own technology industry sees far less of the money than the official figures suggest.

A Small Club Gets Most of the Money

The spending is heavily concentrated. Just 150 companies receive 83 percent of public sector technology spending, and the largest 15 account for almost half. Smaller suppliers receive just 12 percent of government technology spending, compared with 27 percent of spending across government as a whole.

Competition looks weak too. According to IPPR, 89.9 percent of government IT contracts awarded over the past 12 months had no published record of how many suppliers bid for the work, so it is hard for anyone outside government to judge whether procurements were genuinely competitive.

That concentration matters because it shapes what the government can do next. When a handful of large suppliers dominate, switching to a different provider becomes expensive and disruptive, and the government loses bargaining power. The report's title, Locked In, is a reference to exactly that problem. For most people, government procurement sounds distant from daily life. But the technology the state buys shapes the services everyone uses, from NHS systems to tax services and benefits. When that technology comes from a small number of foreign suppliers, the government has less control over prices, less say over how data is handled, and less room to support home-grown firms.

AI Arrives Through the Back Door

The picture gets murkier when artificial intelligence enters the frame. Government spending records show relatively little money going directly to AI companies such as OpenAI and Anthropic. That does not mean Whitehall is not buying their technology. Much of it arrives bundled into existing cloud agreements, enterprise software licences, and partnerships, where it is hard to see and harder to challenge.

One example in the report is NHS England's rollout of Microsoft 365 Copilot to 505,000 staff, carried out under a national licensing agreement signed in June 2023, before Copilot was even generally available. AI tools reached half a million public sector workers through a deal negotiated before those products were on the market, potentially leaving rival suppliers without an opportunity to compete.

The report points to recent US restrictions on Anthropic models and limits on early access for Britain's AI Security Institute as evidence that dependence on American technology carries real risk.

What IPPR Wants the Government to Do

The researchers do not argue that Britain should try to build everything itself. They say that would be unrealistic, and the government's existing £500 million Sovereign AI Fund will not be enough on its own to loosen Silicon Valley's grip.

Instead, the report calls for a change in how Whitehall buys. It wants the government to negotiate technology contracts as a single customer, rather than department by department, so it can use its full buying power. It wants it to be easier to switch suppliers, and it wants Britain to work with other countries, including France, Germany, Japan, and South Korea, to secure access to advanced AI.

Roa Powell, senior research fellow at IPPR, said: "But we cannot do it alone, and building domestic capability can't be our only bet. The UK should be working with other middle powers, pooling our buying power to shape markets and using shared leverage to secure access to frontier AI."

Darren Jones MP, who wrote the report's foreword, made a similar argument, saying Britain should work with international allies rather than attempting to build everything itself.

Whitehall may keep talking about buying British. On the evidence of this report, it will need to change how it buys before the slogan matches the spending.

Frequently Asked Questions

What did the IPPR report find about UK government tech spending?

IPPR found that while 42.5 percent of spending with the public sector's 150 largest technology suppliers appears to go to UK companies, the figure falls to 15.4 percent once foreign-owned firms, firms with most staff overseas, and resellers are stripped out. The United States takes £9.2 billion of £19.2 billion.

Why do resellers distort the figures?

Resellers buy technology from other companies and sell it on to the government. IPPR found 43 percent of spending attributed to UK-headquartered suppliers goes to resellers, and much of that money ends up with the US firms whose products are being resold.

What does IPPR recommend the government do?

The report recommends negotiating technology contracts as a single customer, making it easier to switch suppliers, and working with countries such as France, Germany, Japan, and South Korea to secure access to advanced AI.