The UK Labour government, led by Prime Minister Keir Starmer, is reworking its artificial intelligence (AI) strategy to focus on public sector adoption while cutting costs ahead of an autumn budget. The administration has scrapped a £1.3 billion ($1.72 billion) investment plan, which included an £800 million commitment to develop a supercomputer at the University of Edinburgh, a move criticized by industry leaders who argue it signals a retreat from innovation. Additionally, plans for a San Francisco office for the AI Safety Institute are under review, and there has been a notable shift in personnel, with the firing of Nitarshan Rajkumar, a co-founder of the institute. Critics express concern that these changes may hinder the UK's standing in the AI sector, especially in comparison to France's recent €2.5 billion ($2.77 billion) investment in technology development. Sources close to the Department for Science, Innovation, and Technology suggest that this shift reflects a broader strategy to appear distinct from the previous Conservative administration. The changes have sparked a debate on the balance between cost-saving measures and maintaining a competitive edge in AI innovation.