UK’s multibillion AI drive built on ‘phantom investments’
TL;DR: A Guardian investigation has found that flagship AI investments by CoreWeave and Nscale, central to the UK government’s AI strategy, are largely unverifiable. CoreWeave’s £1 billion “investment” amounted to renting space in existing data centres, while Nscale’s promised supercomputer site remains a scaffolding yard.
The UK government’s AI investment programme is facing serious scrutiny after an investigation revealed that headline-grabbing commitments from two Nvidia-backed companies may amount to far less than claimed.
What the investigation found
CoreWeave’s £1 billion investment, announced in 2024 with promises of “two new data centres”, turned out to involve renting space in facilities built in 2002 and 2015. The company deployed Nvidia chips into existing buildings rather than constructing anything new. CoreWeave described this as “industry-standard” but declined to say how many jobs the investment had created.
Nscale’s position is more striking. The company’s flagship project, a supercomputer site near Loughton billed as “the largest UK sovereign AI data centre”, was still being used as a scaffolding yard when journalists visited in February. The government acknowledged that Nscale’s £1.9 billion ($2.5 billion) commitment was “not a formal contract, rather an intention to commit capital”. The company only submitted a planning application after the Guardian began asking questions.
No government oversight
The Department for Science, Innovation and Technology confirmed it is “not playing an active role in auditing these commitments”. Investment figures came from the companies themselves, and the government could not provide breakdowns of what the money covered.
Professor Cecilia Rikap of UCL described the claims as “phantom investments”, arguing that tech companies “artificially inflate data centres’ job creation and economic impact to please governments”.
CoreWeave’s next project, an AI growth zone in Lanarkshire promising 3,400 jobs and 1GW of on-site renewable energy, has also drawn scepticism. The site currently has just 24MW of capacity, less than 3% of what is promised.
Looking forward
The findings raise uncomfortable questions about AI investment claims worldwide. With more than £500 billion promised globally in 2025, the UK example suggests governments may need stronger mechanisms to verify that announced investments translate into actual infrastructure, jobs, and economic benefit.