Keir Starmer’s AI Legislation: A Departure from Rishi Sunak’s Conservative Approach?

• Keir Starmer is set to announce major AI policies during at the King’s Speech tomorrow.
• The Labour Party believes AI is key to kickstarting the UK economy.
• Labour intends to introduce robust regulations for the AI sector.

Newly appointed UK Prime Minister Keir Starmer will introduce a new artificial intelligence (AI) bill at the King’s speech on Wednesday, July 17, 2024.

Expected to focus on large language models (LLMs), deepfakes, legal safeguards, and plans to spur innovation, the Labour Party will be taking a different approach to the AI sector than its Conservative predecessor.

AI Rules

During Rishi Sunak’s time as Prime Minister, the UK hosted the world’s first  AI Safety Summit in November 2023. It came as part of Sunak’s enduring commitment to position the UK as a leader in AI governance. This also included the creation of the world’s first AI Safety Institute to oversee and evaluate AI models with potentially dangerous capabilities.

Unlike the European Union, which has produced comprehensive AI regulations, the Conservative government was reluctant to regulate the industry. In a February 2024 paper , the Conservative Party explained that it had held back  on introducing “binding measures” and rules. However this was done in fear of stifling innovation and preventing the UK from relishing the full benefits of AI.

Having already promised to outlaw sexually explicit deepfakes, Labour intends to take a different approach to AI regulation and pledged in its manifesto to support innovation through:

“[…]the safe development and use of AI models by introducing binding regulation on the handful of companies developing the most powerful AI models.”

Despite a pro-innovation approach, Starmer has reservations about AI’s impact on the job market and has previously  urged that AI must serve the working people, not replace them.

AI Initiatives

The Labour Party manifesto has several AI-specific commitments under its “Kickstart economic growth ” section.

Firstly, it intends to address the regulatory gaps by establishing a “Regulatory Innovation Office and Developing Ethical AI” to consolidate and speed up the approval process for AI products and services. It will also introduce targets for tech regulators, monitor decision-making speed, and compare it against international benchmarks, which it hopes will guide industrial strategy.

Labour will also introduce a Regulatory Innovation Office, though it remains yet to be seen how it will differ from the AI Safety Insitute established by the Conservative government at the start of 2024.

Furthermore, Labour plans to remove planning barriers for data centers and designate them as Nationally Significant Infrastructure Projects, which could speed up their approval process. This also includes the creation of a National Data Library, which comes as part of a broader national industrial strategy to consolidate existing research programs and deliver data-driven public services.

There’s also mention of long-term research and development (R&D) funding. This will see Labour scrapping short funding cycles in favor of ten-year budgets, which it hopes will spur meaningful industry partnerships.

Labour Eyes Tokenization

According to its “Financial Growth” plan, the Labour Party has some intentions for crypto and blockchain technologies, with a particular focus on the “tokenization” aspect of the technology, writing :

“Tokenization, which U.K. Finance defines as ‘the digital representation of financial assets using distributed ledger technology,’ presents a significant new opportunity for the U.K.,”

The document, introduced by Labour’s Shadow Chancellor Rachel Reeves, and Tulip Siddiq, Shadow Economic Secretary to the Treasury, also outlined its intentions to make the UK a global securities tokenization hub.

“A Labour government will also look to develop partnerships with other financial centres to establish interoperable standards and enable trade of tokenised assets across borders.”

Furthermore, they intend to leverage the latest technologies such as Artificial Intelligence (AI) and others to deliver “the next phase of Open Banking” and define a roadmap for the future of “Open Finance”.

This includes “embracing”  securities tokenization, CBDCs, and creating more regulatory sandboxes for financial products “to reach underserved communities.”

It is worth noting that Labour supports plans for a digital pound, and a decision on whether or not the Bank of England will issue a central bank digital currency (CBDC) is due in 2025/26, though Parliament will need to approve said legislation.

It’s an angle not too dissimilar from that of the Conservative’s “crypto hub” ambitions. However, the focus on the tokenization of securities, and their use in cross-border trade, may prove fruitful for crypto regulatory clarity  in the UK.

Crypto in UK Politics

A survey  of 3,142 UK adults by Zumo has found that around 38% of 18-24 year-olds have invested in crypto, and a further 40% say they know friends and family who own crypto.

As per the survey, 34% of young adults (18-34) believe that the growth of the UK’s crypto sector should be a primary concern for politicians. Furthermore, approximately a quarter of survey respondents think that becoming a digital assets hub is important for economic growth.

The survey also found that 39% of 18-24 year-olds, and 37% of 25-34 year-olds, view cryptocurrencies as a long-term investment pathway to higher returns.

A similar sentiment is being felt across the pond. As the Biden Vs. Trump campaign trail heats up in the U.S., both candidates are bidding to capture the crypto vote. It is estimated that almost half of all adult Americans own, or have owned cryptocurrencies, and this could have a tangible effect on the outcome of the elections.

The Conservatives on Crypto

Having an economist and innovation advocate such as Rishi Sunak in N0.10 should have boosted the UK’s crypto scene. But with priority legislation struggling to pass through parliament, cryptocurrency has not been a top priority for the UK’s conservative party.

Nonetheless, the Conservatives did manage to introduce several bills that bring crypto under regulation. These have largely been safety and security-centric, granting authorities greater powers to supervise, monitor, seize, and prosecute crypto activity.

About the Author

Eddie Mitchell

Eddie has been writing news and content primarily for crypto news and industry players over the past seven years. With an eye for the bigger picture, Eddie prefers to investigate the broader implications of a story, as well as explore the weird and wonderful world of crypto. He believes blockchain has already changed the world, but observes the space overall with a skeptical and adoring eye.

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