Generative AI could save UK public sector £38 billion annually, says Google Cloud report

Google Cloud has released its "AI & The Public Sector" report, conducted by Public First, detailing the transformative potential of generative AI for the UK's public services. 

The report estimates that by 2030, adopting AI could save the public sector £38 billion annually while improving service delivery and efficiency.

Key findings highlight the impact AI could have on productivity, cost savings, and service quality. The study estimates that up to a third of daily tasks performed by public sector workers could be augmented by AI, enabling a reallocation of resources to high-priority areas.

Examples include the potential to provide an additional 3.7 million GP appointments annually, increase teacher-to-student ratios by 16%, and free up the equivalent of 160,000 police officers for frontline duties.

Despite the potential benefits, adoption remains limited. Only 12% of public administration leaders reported significant use of AI tools, with just 23% of public administration workers regularly using such technology. A majority of managers—66%—believe AI will fundamentally change public sector operations, though barriers such as regulatory concerns, outdated IT infrastructure, and a lack of digital skills persist.

UK Technology Secretary Peter Kyle, commented: "These findings are a powerful reminder of how generative AI can be revolutionary for government services.

"Today we have an opportunity to drive forward public service reform by empowering citizens with the information and tools they need to make better choices and hold services to account."

 To maximize AI's potential, the report recommends prioritizing IT modernization, workforce upskilling, and policy clarity. Examples include integrating datasets securely, clarifying AI use cases, and enabling employees to adopt AI tools effectively.

For broader societal impact, the report emphasizes AI's role as a complement rather than a replacement for public sector workers. Public First's research estimates that 56% of jobs could benefit from AI augmentation, with time savings allowing workers to focus on higher-value tasks.

Kyle added:

“Now the digital center of government, my department is testing how we can put AI to work in the public sector, whether that’s speeding up finding information on GOV.UK or empowering teachers by reducing administrative burdens, allowing them to dedicate more time to what they do best.”