Question to the Department for Digital, Culture, Media & Sport:

To ask His Majesty's Government what steps they are taking to support collaboration between artificial intelligence researchers and video game developers to increase innovation and high-skilled employment.

Answered by Baroness Twycross - Baroness in Waiting (HM Household) (Whip)

The government recognises AI’s established role in the UK's video game sector, such as supporting content generation and character behaviours. As technology advances, AI has the potential to further enhance creativity, efficiency, and accessibility in games development.

UK Research and Innovation (UKRI) has invested in the Centre for Doctoral Training in Intelligent Games and Game Intelligence (IGGI) since 2014. IGGI has produced over 60 PhD graduates at the intersection of AI, games, and human-computer interaction, focused on using games to drive innovation, improve well-being, and tackle societal challenges. Graduates have turned research into business value across the creative industries, including roles at Sony AI and Google DeepMind. The Government will continue engaging with the games industry to understand opportunities and challenges regarding responsible use of AI, to ensure the UK’s innovative games industry thrives in the age of AI.

Our Creative Industries Sector Plan, published in June, announced a number of measures that will support innovation across the creative industries. This includes a £100 million investment to support R&D creative clusters across the UK; and the UKRI will lead efforts to significantly increase public funding and leverage substantial industry investment to promote R&D and innovation in the Creative Industries.

Question to the Department for Science, Innovation & Technology:

To ask His Majesty's Government what steps they are taking to monitor the compliance of artificial intelligence systems deployed in the UK with standards on privacy, transparency and non-discrimination.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

The UK’s data protection framework adopts a technology-neutral and principles-based approach, that applies to all organisations processing personal data, including those deploying Artificial Intelligence systems. The Information Commissioner’s Office (ICO), which is responsible for enforcing data protection laws, has taken steps to provide guidance on how data protection law applies specifically to AI systems, including through updates following recent generative AI consultation series. The ICO also has the power to investigate and impose penalties for non-compliance. Organisations deploying AI systems are required to ensure that any personal data is processed fairly, lawfully, transparently, and securely. Where legal or similarly significant decisions have been made about individuals based solely on automated processing, organisations must put in place safeguards to allow individuals to exercise their right to make representations about the decisions, contest that decision, and to obtain human intervention for it.

Question to the Department for Science, Innovation & Technology:

To ask His Majesty's Government what steps they are taking to support the development of UK-based autonomous and agentic artificial intelligence start-ups, particularly in regard to partnerships and infrastructure.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

The Government is backing UK-based AI start-ups through targeted investment and strategic partnerships via several initiatives.

In partnership with DSIT, Innovate UK is launching a £1 million Prize Fund. This initiative aims to accelerate Agentic AI adoption for design across Advanced Manufacturing, Health and Life Sciences, and the Creative Industries.

Alongside this, the Sovereign AI Unit was announced in the AI Opportunities Action Plan as a new initiative specifically designed to build homegrown capability in emerging areas of the AI ecosystem. Backed by £500 million at the Spending Review, the programme is focused on unlocking opportunities where targeted public intervention can support UK leadership, scale national champions, and secure long-term strategic advantage.

The government has also committed over £1 billion to expand the capacity of the AI Research Resource (AIRR) at least twentyfold by 2030. AIRR is now live and is free to use for academics, public sector organisations, and SMEs. By taking these measures, we are ensuring the UK remains a top destination for leading AI innovation, fostering resilience and long-term prosperity.

Question to the Department for Science, Innovation & Technology:

To ask His Majesty's Government what assessment they have made of the impact of the decision of the High Court in Getty Images v Stability AI [2025] EWHC 2863 (Ch) on copyright and innovation policy, in particular in relation to the use of copyrighted materials to train AI models.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

The Government is aware of the judgment in this case and is considering its implications. We are currently preparing a report on copyright and artificial intelligence, for publication next year. This report will take into account a range of views and evidence, including this judgment.

We recognise how important decisions on AI and copyright are to individuals and business across the creative industries and AI sector and are committed to developing an approach that allows both to thrive.

Question to the Department for Science, Innovation & Technology:

To ask His Majesty's Government what assessment they have made of the Cyber Security Breaches Survey 2025 finding that over 40 per cent of UK businesses experienced a breach or attack in the past 12 months.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

The Cyber Security Breaches Survey shows the cyber threat is significant and it is critical businesses leaders take urgent steps to improve their cyber security. That is why the Government wrote to chief executives and chairs of leading UK companies recently asking them to make action on cyber security a top priority.

The Government has developed tools for businesses to protect themselves, including:

• The highly effective Cyber Essentials Scheme, shown to reduce the likelihood of a cyber insurance claim by 92%,
• The Cyber Governance Code of Practice, to help boards and directors manage cyber risks, and
• NCSC free tools and support, including training for boards and staff, the Early Warning system and the Cyber Action Toolkit for small businesses.

The Government is also taking action to protect the economy. The Cyber Security and Resilience Bill, introduced earlier this week, will boost our cyber defences and better protect our essential public services. Next year, we will publish a new National Cyber Action Plan setting out how Government will respond to the cyber threat and work with industry to raise resilience across the economy.

Question to the Department for Business and Trade:

To ask His Majesty's Government what steps they are taking to develop a regulatory framework to ensure that workplace use of artificial intelligence tools complies with UK employment and data protection law.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

The Information Commissioner’s Office has committed to developing a statutory code of practice on artificial intelligence, so organisations have certainty on how to deploy AI in ways that uphold people’s rights and build public confidence.

Artificial Intelligence is a general-purpose technology with many applications, which is why the government believes most AI systems should be regulated at the point of use by our existing regulators.

The Plan to Make Work Pay set out the Government’s commitment to work with workers, trade unions, employers and experts to ensure rights and protections keep pace with technological change.

Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of international policy cooperation on regulating artificial intelligence in financial services; and whether they plan to develop further UK policy in this area.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

The government’s ambition is to make the UK a global leader in AI, leveraging our dual strength in financial services and AI to drive growth, productivity, and consumer benefits. Encouraging safe adoption is an essential part of realising that ambition.

International collaboration is vital to ensure that we can collectively unlock AI’s potential. The UK remains committed to working internationally, including through fora such as the Financial Stability Board (FSB), to support the safe adoption of AI in the financial sector.

Question to the HM Treasury:

To ask His Majesty's Government what steps they are taking to review tax and residency rules, following reports of UK technology founders relocating overseas.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

The UK uses the Statutory Residence Test (SRT) to determine UK residency for tax purposes. UK tax residents normally pay tax on their worldwide income and gains, while non-UK residents only pay UK tax on their UK income and gains.

The Government’s priority is improving the UK’s competitiveness internationally and securing economic growth.

The Government is backing entrepreneurs and fostering a pro-business environment by ensuring the tax system is designed to support innovation and economic growth. That is why we have announced a package of measures to back entrepreneurship at Autumn Budget 2025.

The Government keeps tax and residency rules under review to ensure they remain competitive and responsive to the needs of innovative sectors, including technology.

Question to the Department for Business and Trade:

To ask His Majesty's Government what assessment they have made of the findings of SumUp's UK Business Confidence Report 2025, and of the implications of those findings for policies relating to the cost pressures faced by small and independent retailers.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

We recognise the challenges facing businesses at the moment. This is why we are taking action – including through creating a fairer business rates system which includes introducing permanently lower rates for eligible retail, hospitality and leisure properties.

We're protecting the smallest businesses from the impact of the increase to employer National Insurance by increasing the Employment Allowance from £5,000 to £10,500, which means that 865,000 employers will pay no employer NICs at all this year.

We also recognise the challenge in accessing the right skills which is why we've created Skills England, the new Growth and Skills Levy, the introduction of the Lifelong Learning Entitlement, as well as qualifications reform and the Independent Curriculum and Assessment Review, this Government is ensuring employers will be better supported to recruit and train the domestic workforce with the skills they need.

Finally, our Plan for small and medium-sized businesses aims to tackle late payments, boost access to finance, and remove red tape to enable SMEs across the country to grow and thrive.

Question to the Department for Science, Innovation & Technology:

To ask His Majesty's Government what steps they are taking to work with technology companies and child safety agencies on regulatory frameworks for detecting child protection risks in artificial intelligence systems.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

Illegal provisions have been in place since March, and additional protections for children since July of this year. Under the Online Safety Act, AI services that allow users to share content with one another or search live websites to provide results must protect all users from illegal content and children from harmful content.

The Government engages with a range of stakeholders on the impact of AI and will continue to act to address new and emerging AI harms. Through the Crime and Policing Bill we are introducing an offence to criminalise AI models which have been optimised to create child abuse material and have tabled amendments to support the stringent testing of AI systems for child sexual abuse material risks.

Question to the HM Treasury:

To ask His Majesty's Government what steps they are taking to improve data quality standards in financial services to ensure the reliable use of artificial intelligence in regulatory compliance.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

The government’s ambition is to make the UK a global leader in AI, leveraging our dual strength in financial services and AI to drive growth, productivity, and consumer benefits. Encouraging safe adoption is an essential part of realising that ambition.

As set out in the Bank of England and Financial Conduct Authority’s October 2022 discussion paper on artificial intelligence and machine learning, a range of existing legal requirements and guidance are relevant to the UK financial sector’s use of AI across the AI lifecycle. This includes in relation to data quality.

The government’s response to the AI Opportunities Action Plan also sets out the steps we will take to responsibly unlock data assets in the public and private sector.

Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the risk to consumers using AI chatbots for financial advice, following the consumer study findings from Which? stating such tools provided inaccurate financial advice.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

The government recognises that many people lack the support they need to make financial decisions and are increasingly turning to technologies such as general purpose large language models for help.

Together with the Financial Conduct Authority (FCA), the government wants to ensure that people can receive meaningful support from firms they know and trust, such as their bank or pension provider. That is why we are enabling trusted firms to do more to proactively support their customers.

To deliver this, the government is introducing a new regime for targeted support, which will allow firms to engage directly with customers and suggest products or courses of action for their financial situation. As announced by the Chancellor at Mansion House, targeted support will be available online in time for the next financial year.

Alongside this, the UK’s data protection framework applies to the processing of personal data across the design, development and deployment of AI tools. Organisations are required to ensure that personal data is processed fairly, lawfully, transparently, and securely. People also have a number of rights over how their personal data is used, such as the right of access, rectification, or erasure.

Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of reports that UK inflation slowed to 3.6 per cent in October, and what the implications are for policies aimed at reducing cost-of-living pressures for households and businesses.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

The OBR expects inflation to have peaked in Q3 2025, and that it will fall progressively to the Bank of England’s 2% target in Q1 2027. The Bank of England has overall responsibility for controlling inflation and beyond this, the government is targeting inflation at its source, by bearing down on everyday expenses such as energy bills, transport and childcare costs to ease cost of living pressures.

Taken together the OBR’s forecast shows government policy will reduce CPI inflation by 0.4 percentage points in 2026/27. This is the biggest near-term reduction in inflation due to government policy ever forecast by the OBR at a single fiscal event, outside of a crisis.

Question to the HM Treasury:

To ask His Majesty's Government what steps they are taking to encourage UK-based fintech founders to retain and expand their companies in the UK, including through targeted tax and regulatory incentives.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

The Financial Services Growth and Competitiveness Strategy identified Fintech as a priority growth opportunity, and set out the government’s ambition for the UK to remain a leading jurisdiction to start, scale and list a Fintech business.

The Strategy set out a series of measures to shape a regulatory environment for financial services that is proportionate, predictable and internationally competitive. These included working with the regulators to make it quicker and easier for new firms to achieve regulatory authorisation, as well as the launch of a joint FCA-PRA Scale-Up Unit, to enhance engagement with fast-growing, innovative regulated firms.

The Government published its Corporate Tax Roadmap at Budget 2024, which set out a number of commitments for this Parliament. Central to this is the commitment to cap Corporation Tax at 25 percent for the duration of this parliament, confirming the UK as the jurisdiction with the lowest rate in the G7. This is supplemented by some of the most generous business investment tax reliefs and allowances in the OECD - includes full expensing, R&D tax reliefs, and the Patent Box regime.

Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the confidence of financial technology company founders in the UK economy.

Answered by Lord Livermore - Financial Secretary (HM Treasury)

The UK has a long history as a powerhouse of financial services innovation, which has made the UK one of the most attractive locations worldwide to establish Fintechs. The Financial Services Growth and Competitiveness Strategy set out a comprehensive package of reforms to maintain the UK’s global leadership in Fintech.

The Government is committed to making the UK the best place to start and grow a business, recognising the importance of a competitive investment environment for economic growth. The UK is already the best place in Europe to establish a business, and, to make it even easier for entrepreneurs to scale and stay in the UK, the most recent Budget set out a series of measures which will help unlock billions in investment, expand tax reliefs, and make government a better customer for innovative businesses.

Question to the Department for Science, Innovation & Technology:

To ask His Majesty's Government what assessment they have made of the impact of artificial intelligence tools on employment levels, in the light of the finding in the Chartered Institute for Personnel and Development Labour Market Outlook report, published on 10 November, that 17 percent of UK employers expect to reduce their workforce due to AI tools in the coming year.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

We want to ensure people have access to good, meaningful work. AI has the potential to transform the labour market and Government is working to ensure the UK is well prepared, so that AI drives growth and opportunities for workers, businesses, and communities.

We are closely monitoring data on the impact of AI on the workforce, such as the CIPD report, and actively preparing for a range of scenarios. We are supporting workforce readiness for AI through multiple initiatives. Including our commitment to give 7.5 million workers essential AI skills by 2030.

Question to the Department for Science, Innovation & Technology:

To ask His Majesty's Government what steps they are taking to develop accessibility standards for AI-enabled assistive communication technologies used by people with disabilities.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

The Public Sector Bodies Accessibility Regulations require most public sector organisations to ensure their services, websites, intranets, extranets, published documents, and apps are accessible to disabled people by meeting the requirements of the Web Content Accessibility Guidelines v2.2 to level AA and by publishing a prescribed format accessibility statement. This includes requirements to work with assistive technologies. The regulations apply regardless of if the technology is AI enabled or not. The Government Service Standard requires Departments to make sure everyone can use the service. The standard doesn’t apply to the wider public sector.

Question to the Department for Science, Innovation & Technology:

To ask His Majesty's Government what assessment they have made of reports that children are using artificial intelligence chatbots for mental health advice, in particular with regard to online safety and child protection.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

This Government is committed to improving NHS mental health services to ensure that children and young people receive the right support at the right time for their mental health.

The Online Safety Act requires all in-scope services, including AI chatbots, to proactively remove illegal suicide and self-harm content. Services likely to be accessed by children must take steps to prevent children from accessing suicide, self-harm, or eating disorder content.

DHSC’s 10 Year Plan has set out an ambitious reform agenda to transform mental health services to improve access and treatment and promote good mental health and wellbeing for the nation.

Question to the Department for Business and Trade:

To ask His Majesty's Government whether they plan to review the regulatory requirements applying to AI-enabled toys for children.

Answered by Baroness Lloyd of Effra - Baroness in Waiting (HM Household) (Whip)

Government has committed to reviewing product regulations including the Toys (Safety) Regulations. These reviews will examine whether changes are needed to detailed safety requirements to reflect modern challenges, such as the use of AI in toys.

Following an appropriate consultation as required under The Product Regulation and Metrology Act 2025, Government will decide whether to implement any changes to the Toy (Safety) Regulations to ensure they address modern safety issues and technological developments, harness opportunities to create economic growth, and continue to protect people and places from product-related harm.

Question to the Department of Health and Social Care:

To ask His Majesty's Government what steps they are taking to assess the clinical safety and cost effectiveness of AI mental health tools funded and used by the NHS.

Answered by Baroness Merron - Parliamentary Under-Secretary (Department of Health and Social Care)

The Government is committed to ensuring that artificial intelligence (AI) tools used in mental health care within the National Health Service are clinically safe and deliver value for money. We are working with regulators such as the Medicines and Healthcare products Regulatory Agency, the National Institute for Health and Care Excellence, and other partners to ensure all AI mental health tools deployed in the NHS meet the requirements of the United Kingdom’s regulatory system, to ensure these technologies are safe for use and cost-effective.

Additionally, NHS England applies the Digital Technology Assessment Criteria to evaluate the safety, security, and usability of digital health tools. Independent clinical evaluations and pilot studies are also undertaken prior to wider implementation of these technologies.

Through the AI in Health and Care Award, which ran from 2020 to 2024, the NHS AI Lab funded the testing and evaluation of two mental health technologies, Limbic Access and Wysa. As set out in the 10-Year Health Plan, the NHS is working towards rolling out digital mental health tools. As part of this process, each technology is assessed not only for clinical safety but also for cost-effectiveness, ensuring that these innovations deliver measurable benefits and represent good value for the NHS and taxpayers.

Question to the Department of Health and Social Care:

To ask His Majesty's Government whether they have had discussions with commercial users about pricing arrangements for access to datasets through the Health Data Research Service.

Answered by Baroness Merron - Parliamentary Under-Secretary (Department of Health and Social Care)

To ensure an appropriate commercial model is developed for the Health Data Research Service (HDRS), discovery work has been undertaken to gain insight into existing commercial models that might be applicable for the HDRS. This discovery work included engagement with 19 commercial organisations representing users of health data, allowing the development of a robust, up to date, and United Kingdom-wide evidence base. Decisions regarding what commercial model and pricing arrangement is used will be within the remit of the incoming HDRS senior leadership team.

Question to the Department of Health and Social Care:

To ask His Majesty's Government what assessment they have made of expanding community-based diagnostic and treatment services to reduce pressure on hospital capacity.

Answered by Baroness Merron - Parliamentary Under-Secretary (Department of Health and Social Care)

The 10-Year Health Plan sets out a transformed vision for elective care by 2035, where the majority of interactions no longer take place in a hospital building, instead happening virtually or via neighbourhood services. Planned care will be more efficient, timely, and effective, and will put control in the hands of patients.

The Elective Reform Plan sets out the productivity and modernisation efforts needed to reach the 92% standard by March 2029. This includes expanding existing community diagnostic centres (CDCs), and building up to five new ones in 2025/26, as well as extending opening hours to 12 hours per day, seven days a week. We will also expand the number of hubs over the next three years. Further details and allocations will be set out in due course.

CDCs are key to delivering on the Government’s ambition to move more planned care from hospitals to the community, reducing pressure on hospitals and delivering more convenient care close to home. Under the Government, CDCs have delivered over 9.4 million tests and scans since July 2024, supporting patients to access vital tests, scans, and checks around their busy working lives.

Dedicated and protected surgical hubs transform the way the National Health Service provides elective care by focusing on providing high volume low complexity surgery, as recommended by the Royal College of Surgeons of England. By separating elective services from urgent and emergency care, hubs improve patient outcomes and reduce hospital pressures. There are currently 123 operational hubs across England, 22 of which have opened since the Government took office.

The 2025 Spending Review confirmed over £6 billion of additional capital investment over five years across new diagnostic, elective, and urgent care capacity. Further details and allocations will be set out in due course.