UK leads Europe in public sector adoption of generative AI

New research from Capgemini indicates that the UK is ahead of other European nations in adopting artificial intelligence within government, with a significant proportion of public sector organisations either exploring or actively deploying generative AI initiatives.

According to Capgemini's latest report, 'Data foundations for government – From AI ambition to execution,' three-quarters (75%) of UK public sector organisations are currently engaged with generative AI projects. The report also identifies key barriers to wider adoption, citing concerns over data security (78%), data sovereignty (78%), and cost constraints (68%) as the principal limiting factors.

The environmental impact of generative AI is also a prominent concern, with three-quarters (75%) of UK public sector organisations expressing apprehension about the technology's effects on sustainability.

The study, which included a survey of executives from 350 public sector organisations across multiple regions, reveals broader trends in AI readiness among government bodies worldwide. Overall, two-thirds (64%) of public sector organisations are exploring or using generative AI to improve public services, decision-making, and operational efficiency.

The report also highlights the emergence of agentic AI as a focus for many governments. Capgemini finds that nine in ten public sector organisations globally plan to explore, pilot, or implement agentic AI technologies in the next two to three years, with 39% seeking to evaluate feasibility, 45% preparing to pilot, and 6% aiming to scale existing initiatives.

Sector-specific findings show a higher rate of adoption in some public sector areas, with 82% of defence agencies, 75% of healthcare organisations, and 70% of security bodies globally either scaling, piloting, or exploring generative AI.

Marc Reinhardt, Public Sector Global Industry Leader at Capgemini, commented on the findings: "With rising citizen demands and stretched resources, public sector organisations recognise the ways in which AI can help them do more with less. However, the ability to deploy Gen AI and agentic AI depends on having rock-solid data foundations. Looking ahead, governments can be more agile and effective as AI augments the work of government employees to source information, conduct policy analysis, make decisions, and answer citizen queries. However, to reach this future, governments need to focus on building the right data infrastructure and governance frameworks."

Despite growing interest in AI applications, there is widespread acknowledgement in the public sector of the significant barriers that remain before full adoption can be realised. Data security is viewed as a major obstacle by 79% of global respondents, while 74% cite limited trust in AI-generated results as a primary concern. Regulatory readiness also emerged as an issue, with less than four in ten (36%) of EU organisations confident in their ability to comply with the EU AI Act.

Capgemini's data shows that progress in data management and skills since 2020 has been modest. Only 12% believe their organisation is highly mature in activating data effectively, 7% report being very mature in developing data and AI skills, and just 21% feel they have sufficient data for training and fine-tuning AI models, such as those used for generative AI.

Data sharing is recognised as crucial for maximising the effectiveness of AI models. However, concerns regarding data, cloud, and AI sovereignty remain prevalent. While all public sector organisations surveyed have data sharing initiatives either active or in the planning stage, 65% report their efforts are not yet mature and remain at the pilot or planning stage globally.

The report explores organisational strategies for developing the necessary leadership to address these challenges. It finds that 64% of public sector organisations globally have appointed a Chief Data Officer, with a further 24% intending to establish the role. Similarly, the increasing importance of AI strategy is reflected by 27% of organisations having a Chief AI Officer and 41% planning to introduce this post in the future.

The survey underlying the report was conducted during December 2024 and January 2025, targeting executives from a range of public sector segments, including public administration, tax and customs, welfare, defence, security, and healthcare. Respondents represented multiple government levels across several geographic regions.