Big Boss Interview

Artificial intelligence is advancing faster than the safeguards around it, and industry self-regulation is "not sufficient any longer". That is according to Brad Smith, president of Microsoft. Speaking to Will Bain on BBC's Big Boss Interview, Mr Smith said the world should worry more about AI safety than about any previous generation of digital technology in his 33 years in the industry.
Microsoft is one of the world's largest AI developers and an investor in OpenAI. Mr Smith's comments set out a position that goes beyond the "tremendous self-regulation" praised in a recent White House AI accord.
"Right now I'd argue that AI is moving forward faster than the speed of safety," Mr Smith said. "That's not good for the protection of the public. It's not even good for the industry itself."
Mr Smith set out three measures. The first is a "safety brake or emergency brake" on any AI system controlling autonomous devices or critical infrastructure, an idea often described as a kill switch. He said it should sit in the companies running the models and in the cloud infrastructure they run on. The second is a legal obligation to report incidents: if AI agents "break loose" and break into systems, the victims should be told, as they are after a data breach.
The third measure, which he called the biggest and most important, is whether government evaluators should have to sign off frontier models before release. "Just remember, right now, your washing machine is subject to more safety rules than AI," he said. He added that cartons of milk and passenger aircraft are subject to inspection and certification.
He said the UK was the country best placed to lead. The AI Security Institute, he said, has the strongest technical capability in the world to test AI models: "It's the United Kingdom. They are the best." In his account, the US began building similar capability and then slowed down. Asked about Anthropic declining UK testing of one of its models, he said the question now was when developers should be required to satisfy a government regulator that a product is safe before it is released. He described Britain as "a bridge across the Atlantic and across the English Channel". He also noted that in Washington, people "don't look at London the same way they look at Brussels".
Mr Smith also responded to Vice President JD Vance, who had accused Microsoft of abusing the H-1B visa system more than any other US company. Mr Smith said the vice president's staff "got the maths wrong". He said about 80% of the company's 6,000 visa applications were for existing employees, every green card applicant was already employed by Microsoft, and the company hired 9,000 Americans last year.
On data centres, he said the cost of new grid capacity "should not be the neighbours… it should be the industry itself".
Presenter: Will Bain
Producer: Olie D'Albertanson
Editor: Henry Jones

Negative perceptions of London’s stock market influenced companies’ decisions about where to list, according to Dame Julia Hoggett, chief executive of the London Stock Exchange. Speaking on Big Boss Interview, she acknowledges that companies had delayed or considered listing elsewhere because of the narrative surrounding London, but says that reflected the mood three or four years ago.
“Markets do operate on sentiment,” she says. “We need to stop throwing shade at ourselves as a nation and being a bit surprised if it’s a bit dark, a bit chilly and a bit damp.”
Hoggett also argues that coverage of London’s difficulties does not fully reflect the scale of its markets. She says the London Stock Exchange is Europe’s largest equity market by capital raised that year, the world’s second-largest fixed-income market and its largest market for closed-ended funds. She also points to Britain’s record of creating and growing businesses, saying the country produces more companies valued at over $1bn than anywhere outside the United States and China.
She challenges the assumption that British companies will necessarily perform better by listing in the US. Citing figures for a group of British businesses that raised money there since 2014, she says many have subsequently delisted and only a minority are trading above their listing prices.
Hoggett also says regulatory reform needs to be accompanied by stronger incentives to invest in Britain. Her argument is that the country has substantial pools of savings and promising businesses, but too little domestic capital flowing into those companies.
She wants a route towards abolishing stamp duty on share purchases, which she calls “a pernicious tax”. She proposes starting with relief for UK investment through ISAs and eligible pension funds, while acknowledging the revenue the government would lose. She also advocates a 10% dividend tax credit and inheritance-tax incentives linked to pension investment in Britain.
Asked whether ISA tax advantages should be restricted to British investments, she says: “I genuinely think it’s worth looking at.” She maintains that she is not asking pensioners to accept lower returns, but wants the tax system to make investing in UK companies more attractive.
Presenter: Will Bain
Producer: Olie D'Albertanson
Editor: Henry Jones

Britain is "walking into a second significant energy crisis", the boss of the country's largest electricity generator has warned. Simone Rossi, chief executive of EDF in the UK, told the BBC's Business Editor Simon Jack on the Big Boss Interview that household bills are forecast to rise by around 20% in January. Customers still owe more than £5bn from the last crisis, four years ago.
Gas is driving the rise. Gas prices are up 25%, while the electricity part of the price cap is 4% lower than in January. His advice is blunt: where you can, choose electricity over gas. He blames wars hitting the world's two biggest gas suppliers at once (Russia and Qatar), which he calls "almost unthinkable".
Closer to the UK, he is asked whether ministers should approve the Rosebank and Jackdaw fields, he says: "Green light. Absolutely. No doubt about it." With most homes heated by gas and most cars running on petrol or diesel, weaning Britain off fossil fuels will take decades. Until then, he argues, producing oil and gas at home keeps jobs and tax receipts in the UK and pollutes less than importing it. "It's a no-brainer."
Nor does he expect relief soon. Ed Miliband promised bills £300 lower by the end of this parliament. Mr Rossi expects them to stay stubbornly high until 2030. Britain built an energy system for rising demand, but demand fell even as the economy grew by 30% and the population by about 10 million. The cause, he says, is deindustrialisation. The fixed costs of the grid are now spread across fewer users, and "somebody's got to pay".
That explains the paradox of cheap renewables and expensive bills. Wind and solar are the cheapest power to produce, but cost is not the same as value. Electricity is hard to store and does not travel well, so every wind farm far from where people live needs costly cables, grid and storage. Last year Britain paid wind farms to switch off nine terawatt-hours of power while importing more than £40bn of fuel.
His answer runs against intuition: more demand means lower bills. Ten million electric vehicles, two million heat pumps and more data centres would spread those fixed costs more widely. He wants ministers to move more policy costs from bills into general taxation, extend the zero VAT rate on electricity beyond April, and introduce a proper social tariff. Bills, he says, have become "a tool to pay for a lot of stuff", and that makes them regressive.
Then there is the winter. Britain's gas storage is low, and relying on imports could mean "staggering" prices at peak times. "If we are caught short," he warns, "basically we are naked in front of the markets."
Presenter: Simon Jack
Producer: Ollie Smith & Olie D'Albertanson
01:15 Why UK energy bills are so high
04:11 Why cheap renewables don't mean cheap bills
07:30 Walking into a second energy crisis
12:33 Paying wind farms to switch off
13:48 Rosebank, Jackdaw and the North Sea
17:20 Bills stubbornly high until 2030
21:58 Clean power 2030 versus reindustrialisation
27:41 Hinkley Point, Sizewell C and the cost of nuclear
32:28 Low gas storage and summer grid scares

The boss of Aviva, Britain's biggest insurer, has warned that some homes being built today could eventually become impossible to insure because of flood risk.
Speaking to Sean Farrington, Dame Amanda Blanc said Britain is continuing to build homes in areas exposed to flooding, despite the growing threat from climate change. Aviva estimates 6.3 million UK homes are already at risk of flooding, a figure it expects to rise to 8 million by 2050.
She said insurance works by spreading risk across large groups of people, but once flooding becomes almost certain, cover becomes much harder to provide. She questioned why thousands more homes are still being built in flood-prone areas and called for greater care in planning decisions.
Dame Amanda also used the interview to send a message to the Chancellor ahead of the Budget, urging ministers not to fuel speculation about changes to pensions. She said rumours before last year's Budget led many savers to make decisions they later regretted.
The conversation also covers whether pension funds should invest more in UK infrastructure, the cost of regulation, why millions of people are not saving enough for retirement, and what businesses need from government to drive growth.
And, after a turbulent period at BP, where she is stepping down from the board, Dame Amanda explains why she has no intention of discussing the oil giant's recent troubles.
Presenter: Sean Farrington
Producer: Olie D'Albertanson
Editor: Henry Jones
01:55 Chancellor's speech and the end of coal mining
05:30 Aviva's £100bn UK investment and new industry
09:00 Heathrow third runway and backing big projects
11:20 Budget warning on pensions speculation
14:25 15 million people not saving enough for retirement
20:00 Are insurance premiums working for customers
22:39 Rising flood risk
25:40 Homes that could become uninsurable
26:57 Super El Niño and preparing for extreme weather
28:54 The Aviva turnaround
36:31 BP board exit and questions on leadership
45:15 Welsh Rugby Union and governance
50:10 Sexist comments at her first AGM
52:17 Opportunities for young people and business as a force for good

The chief executive of Britain’s biggest listed technology company has questioned the government’s push to build more data centres, arguing that the UK does not have the scale to become a truly sovereign AI nation.
Steve Hare, chief executive of Sage, says Britain should be realistic about where it can compete.
He argues that data centres themselves are simply infrastructure and do not give the UK control over the underlying technology. If Britain wants greater technological sovereignty, he believes it would need to work with larger economies rather than try to build the whole AI stack alone.
Instead, Hare thinks the bigger opportunity is in applications: using increasingly cheap and widely available AI models to build products that solve real problems for customers.
He points to the rapid fall in the cost of leading AI models and believes much of the value will ultimately sit with the companies building useful services on top of them.
His caution is informed partly by experience. Hare was finance director of Marconi when the dotcom bubble burst in 2001. Looking at the huge sums now being spent on AI infrastructure, he thinks much of that capacity will eventually be used, but not necessarily at today’s prices.
He is also worried about the wider UK economy.
Sage provides accounting, payroll and finance software to millions of small and medium-sized businesses, giving Hare a close view of what is happening inside companies. Its data suggests profits are rising faster than revenues, with many business owners holding on to cash rather than investing.
Hare says uncertainty around tax and economic policy is making that caution worse. He is particularly critical of repeated speculation over capital gains tax, which he believes risks pushing entrepreneurs to build their next businesses elsewhere.
He also points to Britain’s long-running problem with scale. The UK creates large numbers of new businesses, but relatively few grow into major global technology companies before being sold, often to overseas buyers.
Hare is due to meet the new prime minister at Number 10 and says the government now needs to make some difficult choices.
His central message is that stronger growth is the only sustainable answer to rising spending pressures, borrowing costs and the demand for higher public revenues.
And his advice to both business leaders and government is simple:
“Be bold and be paranoid.”
Presenter: Sean Farrington
Producer: Olie D'Albertanson
Editor: Henry Jones
01:47 AI hype and the pace of change
08:14 How AI will change work
09:18 Growth as the UK's biggest challenge
15:03 Tax speculation and entrepreneurs moving abroad
19:35 Apprenticeships and employment rights
23:49 The prime minister's tough choices
27:20 Britain's scale-up problem
28:49 Data centres & why the UK cannot be a sovereign AI nation
36:02 Lessons from the dotcom crash
41:02 Be bold and be paranoid