UK Government’s £1.7bn Cloud Dependency Exposed as AWS Outage Reveals Critical Infrastructure Vulnerability

Cloud Crisis: When Public Services Hang on a Single Provider’s Stability

The recent Amazon Web Services global outage has revealed more than just temporary technical difficulties—it has exposed the UK government’s deep and potentially risky dependence on a single cloud provider. While Amazon CEO Andy Jassy was celebrating a £40bn UK investment partnership with Prime Minister Keir Starmer just months earlier, this week’s disruption demonstrated the fragility beneath the surface of this technological marriage., according to technology insights

Cloud Crisis: When Public Services Hang on a Single Provider’s Stability
The Scale of Government Reliance on AWS
Regulatory Warnings Ignored
Political Scrutiny Intensifies
Global Impact and Government Response
Beyond Technology: Ethical Concerns in Procurement
The Path Forward: Diversification and Sovereignty

The Scale of Government Reliance on AWS

According to data compiled by public procurement intelligence firm Tussell, AWS has secured 189 UK government contracts worth £1.7 billion since 2016, with approximately £1.4 billion already invoiced. The current landscape shows 35 public sector authorities utilizing AWS services across 41 active contracts valued at a combined £1.1 billion.

Critical ministerial departments including the Home Office, Department for Work and Pensions, HM Revenue & Customs, Ministry of Justice, Cabinet Office, and Department for Environment, Food and Rural Affairs all maintain contracts with the cloud giant. This widespread adoption creates what experts describe as a “significant exposure” to single-point failures in the nation’s digital infrastructure., as detailed analysis

Regulatory Warnings Ignored

The irony of this situation hasn’t escaped legal and technology experts. Tim Wright, technology partner at law firm Fladgate, noted the contradiction between this dependency and repeated warnings from UK regulators. “The FCA and PRA have repeatedly highlighted the dangers of concentration risk in cloud service provision for regulated entities for a number of years,” Wright stated.

Despite recent moves by HM Treasury, the PRA and FCA to establish direct oversight of ‘critical third parties’—measures designed specifically to address outage risks—the government’s own technology strategy appears to contradict the resilience principles advocated by these same regulators.

Political Scrutiny Intensifies

The House of Commons treasury committee has taken formal action, writing to Economic Secretary to the Treasury Lucy Rigby to question why Amazon hasn’t yet been designated a “critical third party” to the UK’s financial services sector. Such designation would subject the tech giant to financial regulatory oversight, potentially mandating higher resilience standards and contingency planning.

Committee chair Meg Hillier revealed that Amazon had recently assured the committee that financial services customers were using AWS specifically to support their “resilience” and that AWS offered “multiple layers of protection.” This week’s events have cast doubt on those assurances.

Global Impact and Government Response

The outage affected more than 2,000 companies worldwide according to Downdetector, with 8.1 million problem reports including 1 million from UK users. Within UK government services, HMRC confirmed it was affected, acknowledging that customers were “having problems accessing our online services” and experiencing busy phone lines.

While Amazon reported that all cloud services had “returned to normal operations” by Monday evening, some systems experienced persistent problems throughout the day, highlighting the challenge of restoring complex interconnected services after major disruptions.

Beyond Technology: Ethical Concerns in Procurement

Unions have raised additional concerns about the government’s relationship with Amazon, pointing to the company’s track record on working conditions. GMB union national secretary Andy Prendergast stated: “Amazon has a truly terrible track record on treating workers fairly. Shocking conditions in warehouses lead to mass ambulance callouts, staff complain they are treated like robots… In this context, for it to trouser almost £2bn of public money is a disgrace.”

Amazon representatives have previously stated that the “vast majority” of ambulance callouts at its sites were not “work related,” but the ethical questions continue to shadow the company’s government contracting activities.

The Path Forward: Diversification and Sovereignty

Technology experts suggest that until significant diversification or sovereign cloud adoption occurs, the UK government will remain vulnerable to similar disruptions. The tension between leveraging the efficiency and innovation of major cloud providers and maintaining control over critical national infrastructure represents one of the defining digital policy challenges of our era.

As government services continue their digital transformation, this incident serves as a stark reminder that technological dependency requires careful management, robust contingency planning, and perhaps most importantly—viable alternatives when primary systems fail.