The UK government is pushing ahead with its AI ambitions yet is dragging its feet on replacing aging IT systems that leave departments vulnerable to cyberattacks, according to a damning assessment from Parliament's spending watchdog. Sir Geoffrey Clifton-Brown, chair of the House of Commons Public Accounts Committee (PAC), warns in his second annual report that Whitehall is failing to tackle its longstanding technology problems, even as AI gives criminals and hostile states new ways to attack government systems. "AI is approaching government like a tsunami, and I remain sceptical that government is prepared for the enormity of this challenge," Clifton-Brown writes. The Conservative MP says ministers have announced reforms to improve digital capability but have yet to explain how they will close the civil service's skills gap, or when. He also fears another Whitehall reshuffle, this time involving the creation of the Department for Business, Innovation, Science and Trade, will make matters worse. The numbers aren't encouraging. Just 6 percent of civil servants work in digital and data roles, well short of the government's 10 percent target. Senior specialists are particularly thin on the ground, and the PAC warns that meeting the target will mean recruiting, and retaining, many more of them. And then there's the technology itself. "Government is also showing a worrying lack of urgency in addressing the long-standing issue of legacy IT systems, which create significant risks for its cyber security and mean it cannot reap the benefits of new technologies," the report states. The report also warns that generative AI is giving fraudsters increasingly sophisticated tools, while government departments risk falling further behind. Fraud and error already cost taxpayers an estimated £55 billion to £81 billion annually, according to figures cited by the PAC. Clifton-Brown isn't impressed with efforts to reduce those losses either. The Department for Work and Pensions reckons it overpaid £9.9 billion in benefits through fraud and error in 2025-26, or 3.2 percent of its spending. Its plan is to get that down to 2.8 percent by 2028-29, but Clifton-Brown points out that even if that succeeds, billions will still be going out the door. Things aren't looking much better at the Home Office, where years of asylum backlogs and mounting costs have prompted what Clifton-Brown calls "counterproductive quick fixes." The Home Office and Ministry of Justice spent around £4.9 billion on asylum in 2024-25, and ministers have since promised an entirely new system without explaining how it will work. That criticism comes as digital rights campaigners at Open Rights Group have called for the Home Office to scrap its AI asylum tools over concerns about accuracy, transparency, and human oversight. Elsewhere, the report offers another reminder that government IT modernization has a habit of going wrong. Take National Savings & Investments (NS&I), which began overhauling its IT in 2020 in the hope of cutting running costs. By December 2024, the price tag had reached an eye-watering £3 billion, £1.3 billion more than first expected. The project has been rated red since 2022-23, meaning successful delivery looks unlikely, and NS&I couldn't even give MPs an up-to-date spending figure or a realistic completion date. The Bank of England, by contrast, managed to overhaul its Real-Time Gross Settlement system for £431 million, finishing the job in April 2025. The PAC was impressed enough to direct its recommendations at Whitehall rather than the Bank, suggesting ministers might want to take notes. Whitehall could start by applying those lessons to the systems it already runs. ®
