Andy Burnham searches for UK alternative to Palantir

Andy Burnham’s government is searching for a UK alternative to Palantir, as the prime minister’s “buy British” push triggers a hunt to find a homegrown replacement for the controversial US software group in the NHS and the Ministry of Defence.

Ministers have identified a handful of UK technology companies they hope might be candidates to take over the health service’s Federated Data Platform, as they consider applying a break clause in Palantir’s contract in March next year, people familiar with the matter told the FT.

Meanwhile, a defence minister has told parliament that the government is sounding out alternative suppliers for its MoD contract.

Some government figures are pushing to replace Palantir, which has come under fire over its links to the Trump administration and the US defence sector, to reduce the risk of a backlash by progressives against Burnham’s drive to foster the British AI industry.

Palantir won a £330mn contract from NHS England (NHSE) in 2023 to run the health service’s Federated Data Platform, a system designed to drive efficiencies and improve care in hospitals by joining up data better.

But the project has been beset by controversy, with NHSE claims about the success of the platform under growing scrutiny after the FT identified a litany of errors in a key underlying dataset.

This year, a minister was forced to apologise after the FT revealed some Palantir staff would have “unlimited access” to identifiable patient information while working on one part of the FDP, which NHSE had failed to disclose.

One option under consideration is to offer Palantir a temporary contract extension of about 12 months to give more time to develop a British alternative, according to people familiar with discussions. The current contract stipulates a minimum two-year extension from March.

Ministers are also considering whether the FDP programme could be divided between several companies, rather than run solely by Palantir.

Quantexa, which was in the running for the FDP contract in 2023, is among three or four British tech companies being considered, according to people familiar with discussions. The others are not known.

However, no decisions have yet been taken, and some Labour figures argue that Palantir’s UK-based business should be considered a British company under Burnham’s definition.

Tom Bartlett, former deputy director of data engineering and integration at NHS England, said it would be “hugely risky” to replace Palantir and “a leap into the unknown”.

“There isn’t a platform that can replace the functionality that Palantir can bring,” he said. “They [the NHS and government] can assemble a group of people who are confident they could do it, but they would be proving themselves for the first time and it would be a gamble.”

While the government began a review of Palantir’s contract when Sir Keir Starmer was prime minister, a specific search for a British alternative is under way after Burnham said he wanted more government spending to go to UK businesses.

“I don’t think we should allow the culture of sending everything outside of this country to continue — this will be a big change under this government,” he said in his first House of Commons appearance as prime minister.

At the Labour Party conference in Liverpool this week, first secretary of state Louise Haigh said the government wanted to build “sovereign capabilities” in AI and boost the UK tech sector. This would ensure the country would not “be in hock to foreign giants”, she added.

One Labour figure confirmed that Haigh’s intervention was “a shot across the bows” at Palantir, adding: “There’s a wider question here about building up sovereign capabilities and capacity — and we do have world-leading UK expertise in this area.” The person said there was a general sense among officials that the UK state was “overly reliant on Palantir and overseas capabilities more widely”.

The Cabinet Office, which runs the machinery of government, has recently reviewed its public procurement rules and rewritten the “social value” requirements to focus more narrowly on UK job creation and skills development.

However, officials have stressed that these criteria are legally “country agnostic”: while they favour companies supporting British jobs and training, that does not have to mean British-owned groups.

Another government figure said there was a particular focus on sovereign capabilities in health technologies, which ministers hoped could transform the NHS while fostering an industry based on its rich data sets.

AI minister Kanishka Narayan told a Politico event on the sidelines of Labour’s conference that polling consistently showed “the British public wants to make sure that their private data, particularly in healthcare, isn’t in the hands of foreign billionaires and foreign firms abroad”.

James Frith, the health innovation minister, told MPs last month that he was “concerned about mistrust of Palantir and the impact it could have on people’s willingness to share data with the NHS”.

Questions about Palantir’s involvement in the health service are seen as more acute than its work with the MoD, according to officials, but it is also being examined.

In November 2022, Palantir was awarded a three-year contract by the MoD worth £75.2mn after the tender was not advertised. In December 2025, the company was directly awarded another three-year contract, again without any competition, worth £240.6mn.

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Speaking in June, in response to questions on the contract, defence minister Lord Vernon Coaker said: “We are seeking to look at options with small and medium-sized and other companies that could provide the same capability, so that we have a competitive process in future.”

The process would “keep Palantir on its toes in the marketplace as well”, he added.

Other European governments are seeking to cut their reliance on American technology providers amid growing concern over US President Donald Trump’s foreign policy.

France and Germany have excluded or cut contracts with Palantir from their armed forces and intelligence agencies in recent months, seeking more local alternatives.

Palantir said in a statement that its software was “helping to deliver better care” and that it was “deeply committed to the UK”.

“More than one in six of our global workforce is based here . . . And all UK government data is stored in the UK,” it added.

The Department of Health did not immediately respond to a request for comment.