Government industrial strategy will back cyber tech in drive for economic growth

UK to fund Ukraine cyber defence

The minister will also announce plans for the UK to invest £8m in Ukrainian cyber defences, more than £1m to protect Moldovan elections, and an extra £7m for artificial intelligence (AI) security research.

The minister is due to tell the audience at the National Cyber Security Centre’s CyberUK conference in Manchester that digital technology also presents a “huge economic opportunity” for the whole country, including the regions.

He will say the government will “turbo charge” the cyber sector in Labour’s upcoming industrial strategy, as part of a drive to “kick-start” economic growth in the UK and to put more money in working people’s pockets.

“There is enormous potential for cyber security to be a driving force in our economy – creating jobs, growth and opportunities for people,” he will say. “It’s already a sector on the up – with over 2,000 businesses across the UK.

“We want the benefits of the cyber industry to reach into communities all across the country,” he will add. “And that is why cyber will be a prime target for economic growth in the upcoming industrial strategy, as the government secures Britain’s future. It is going to be a significant commitment.”

More support for Ukraine

The government will also announce plans to spend £8m supporting Ukraine to defend itself against Russian cyber attacks over the next 12 months.

“Ukraine has put up an incredibly brave fight against Putin’s cyber warfare, and we have vowed to stand shoulder to shoulder with Ukraine for as long as it takes to defend their sovereignty,” he will say.

Support for Ukraine comes on top of a £1.1m investment to give the Moldovan government tools to protect the country’s upcoming parliamentary election against Russian disinformation campaigns.

Russia was accused of “massive” election manipulation in Romania leading to the annulment of elections in March, after Russia supported pro-Moscow populist candidate Cǎlin Georgescu.

Cyber security growth in UK regions

In the UK, according to the Cabinet Office, cyber technology is contributing to growth across the UK regions

The sector holds 67,000 jobs, up 6,600 in the past year, and revenues now top £13bn, up by 12% year-on-year, McFadden will say.

The North West of England is one of the regions that has seen a big upswing in cyber security. The area has benefited as the intended home of the National Cyber Force in Samlesbury, Lancashire, the UK’s offence cyber operation, which aims to counter threats from terrorists, criminals and states, and has prompted collaborations between universities and high-tech businesses in the region.

According to figures released today, 8% of UK cyber security firms and 10% of UK cyber security employment is based in North West England, with the average cyber security salary in the region reaching £54,600.

For the first time last year, the highest proportion (49%) of external cyber security investment was in the North West, following six investments worth over £100m in 2024. This was followed by the South East (21%) and London (14%).

Retail hackers are ‘wake-up call’

McFadden will also urge businesses and organisations in the UK to take cyber security seriously following ransomware attacks on retailers in recent weeks, which the minister described as an “old-fashioned shakedown”.

“Cyber attacks are not a game,” he will say. “Not a clever exercise. They are serious organised crime. The purpose is to damage and extort. What we have seen over the past couple of weeks should serve as a wake-up call for businesses and organisations up and down the UK, as if we needed one, that cyber security is not a luxury but an absolute necessity.”

More funding for AI security research lab

The Chancellor of the Duchy of Lancaster will also give a progress report on the Laboratory for AI Security Research (LASR) he launched last November. 

The AI cyber lab was to be backed with £8.22m of public money to give the UK an advantage in the “AI arms race”, McFadden said last year.

LASR has now funded 10 PhDs at the University of Oxford; nine researchers at The Turing Institute and “pioneering research” through eight leading UK universities including Queen’s University Belfast and Lancaster University.

The minister will announce an additional £7m of government funding, and a partnership between the AI lab and Cisco.

“Cisco will work with LASR, and in particular the NCSC, to run challenges across the UK and build a demonstrator here in the North West to showcase how our scientists and entrepreneurs can work together to manage the risks, build the skills and grasp the opportunities of AI security,” he will say.

“This is the first collaboration of its kind with LASR, and will be a trailblazer where others can follow to help LASR drive cutting-edge research into the impact of AI on national security.”

Cyber protection initiatives

Feryal Clark MP, the Parliamentary under-secretary of state for AI and digital government at the Department for Science, Innovation and Technology, will use the conference to launch a series of initiatives to boost cyber protection for individuals and businesses.

They include a Software Security Code of Practice promoting “essential steps” to secure software sold by suppliers or developed internally.

The guidance will mirror an earlier AI Security Code of Practice, which will today be adopted by the European Telecommunications Standards Institute.

The government will also “drive investment” in the development of a secure chip technology, Cheri, that protects memory in microprocessors against cyber attacks.

Some £4.5m will be spent helping firms bring the chips to market, find customers and encourage their use, Clark will announce.