Sadiq Khan blocks £50m Palantir deal with Metropolitan police

Sadiq Khan has blocked a £50m Metropolitan police deal with the controversial US tech company Palantir, sparking a bitter row between the London mayor and Scotland Yard.

After the UK’s largest police force had agreed to use Palantir’s AI technology to automate intelligence analysis in criminal investigations, Khan intervened, citing “serious concerns” about how the deal had been struck.

The mayor’s office said there had been a “clear and serious breach” of procurement rules and said police had only seriously considered one supplier (Palantir).

But after the Guardian reported the decision, Scotland Yard criticised the block as “disappointing”, saying that without new technology it would have to cut officer numbers, which would in turn affect the force’s ability to keep London safe.

The deal would have been Palantir’s largest yet in British policing, after others worth £330m and £240m with NHS England and the Ministry of Defence.

The row has been inflamed by the fact that Khan has previously made clear that Londoners only wanted to see public money being paid to companies that “share the values of our city”.

The row comes amid a growing public backlash over the British state’s use of services provided by Palantir, which was cofounded by the Donald Trump-supporting tech billionaire Peter Thiel, and also serves the Israeli military and the US president’s ICE immigration crackdown operations.

Last month its chief executive, Alex Karp, published a mini-manifesto extolling the benefits of US power and implying some cultures were inferior to others, in what one MP called “the ramblings of a supervillain”.

The Mayor’s Office for Policing and Crime (Mopac), which has to approve large contracts, vetoed the deal citing Scotland Yard’s failure to obtain its approval for its procurement strategy.

In a letter to the Met commissioner, Mark Rowley, Khan’s deputy mayor for policing and crime, Kaya Comer-Schwartz, said: “I have not been provided with any acceptable explanation for this failure, which I regard as a clear and serious breach of the applicable procedural requirements.”

She said the process had created “legal and reputation risks” to Scotland Yard and the mayor and noted the Met originally costed the contract at £15m-£25m a year, putting the proposed deal at the top of that range.

“The decision by Mopac is disappointing,” said a Met spokesperson. “We need to modernise and use the very best technology available. We must be able to innovate at a faster rate than hostile states and organised criminals. For now, this decision prevents us using technology already available to the MoD, the NHS and other police forces.”

The Met is facing a £125m funding shortfall in the coming year and 1,150 job cuts. Scotland Yard said “without new technology, delivered at pace, we will be forced to make further tough choices that cannot avoid reducing officer numbers, impacting our service to London and our ability to keep the capital safe.”

The mayor’s spokesperson responded that tight budgetary constraints made it “even more important that robust processes are followed when awarding contracts as large as £25m a year”, adding the public would expect full scrutiny of whether such contracts provided value for money.

Chi Onwurah, chair of the Commons science and technology committee, welcomed the mayor’s decision, saying: “I’m pleased that procurement processes are being reviewed by City Hall as it seeks to address the issue of vendor lock-in and dependence on a small number of large, US-based providers.”

The row has cast fresh light on Palantir’s record of winning public contracts in the UK. Scotland Yard previously appointed Palantir on a much smaller contract to use AI to monitor staff behaviour in an bid to root out corrupt officers. This contract was awarded directly, without advertisement or open competition, because its value was just below the £500,000 threshold required for City Hall’s approval.

Khan said on Thursday: “In general terms, what you’re allowing is these private companies to almost have a loss leader, so they give you a good deal or something for nothing for a short bit of time [and] you can become reliant upon them.”

In 2023 the government’s chief commercial officer raised concerns with Palantir about the practice of offering public services for a zero or nominal cost to gain a commercial foothold.

Donald Campbell, director of advocacy at the tech equity campaign Foxglove, said: “Palantir is notorious for its ‘land and expand’ approach, in which it wins small contracts or even offers free services at first, then uses those to build a much wider role in our public services.”.

He said Khan had “seen through this practice, and put a stop to it – while rightly highlighting Londoners’ concerns over Palantir’s ethical record”.

Scotland Yard insisted it had conducted the procurement “diligently” using the crown commercial services framework – a list of government approved contractors including Palantir. City Hall said this did not allow bids from suppliers other than the one that was selected by the Met based on their desktop assessment (Palantir).

There does not appear to be any block on Palantir bidding for a future contract, and Mopac said it wanted to work with the Met on a new procurement plan. Scotland Yard said it would “continue to pursue every avenue to resolve this issue swiftly”.

A spokesperson for Palantir said its software has already helped several English police forces, including identifying 1,000 women in Bedfordshire whose partners had a history of domestic violence in a single year; bringing to justice a criminal gang in Luton that had stolen £700,000 from cash machines; and helped Scotland Yard tackle serious corruption and criminality within its force, under a small pilot contract that used AI for detection.

“We are proud of that work and stand ready to further support law enforcement across the UK,” they said.

Martin Wrigley, a Liberal Democrat member of the Commons science and technology select committee said he was “delighted” by City Hall’s decision.

“To get another contract without competition would have been a disgrace,” Wrigley said. “Palantir have failed to deliver to their promises on too many projects. Buying projects through free trials to then write the contract spec should be banned from government procurement.”

Khan’s move will be a blow to the Labour government’s efforts to use AI to improve policing. In January, the home secretary, Shabana Mahmood, called for police to “ramp up use of AI” and to adopt the technology “at pace and scale”.