The real lesson from the Palantir fallout: digital sovereignty is now a national security issue

The recent debate around Palantir’s role in the NHS and other public-sector systems has sparked important questions about the use of large technology providers in critical national infrastructure. While much of the focus has been on one company, the real significance lies elsewhere.

This moment reflects a shift in how governments and organisations must think about technology. Digital sovereignty is no longer just a procurement consideration, but is increasingly a matter of national security and long-term resilience.

For years, technology decisions have been driven by familiar criteria such as capability, cost and speed. Can the solution solve the problem? Can it be deployed quickly? Will it deliver measurable value?

Those questions remain essential. In many cases, partnering with leading technology providers has enabled rapid transformation, unlocking advanced capabilities that would be difficult, and in some cases unrealistic, to build independently. However, as public services become more reliant on data, analytics and AI platforms, the context around those decisions has changed.

When technology becomes infrastructure

Technology is no longer simply supporting operations; it is becoming the backbone of how operations function. In areas such as healthcare, policing and defence, data platforms increasingly shape decision-making, workflows and service delivery itself. This includes predictive policing tools guiding resource allocation, to AI-driven triage systems helping prioritise patient care in overstretched NHS services.

That raises a new set of strategic considerations. Who ultimately controls the data and underlying systems? How portable are those capabilities if priorities change? Does a given solution contribute to building long-term in-house capability, or does it increase reliance on external providers? And how resilient is the broader ecosystem that supports it?

From a national security and investigations perspective, the issue is not who provides the technology, but whether the state retains sufficient operational control over the systems that underpin critical services. That includes control over access, governance and ability to adapt or respond in times of crisis. For instance, ensuring that law enforcement agencies can independently access and analyse intelligence data during a national security incident, without being constrained by vendor dependencies or contractual limitations.

Importantly, there is a balance to strike. Global technology firms bring scale, expertise and proven platforms that can significantly enhance public sector capability. In many cases, they are essential partners in modernising legacy systems and delivering better outcomes for citizens. This has been seen with cloud providers enabling rapid digital service rollouts across government departments, or AI platforms accelerating fraud detection in financial crime investigations. The challenge is how to work with them in a way that preserves long-term flexibility and resilience.

A strategic shift for the UK

This is where the concept of digital sovereignty becomes more practical than political. It’s not about exclusion or protectionism, but about ensuring that critical capabilities remain adaptable, interoperable and ultimately under appropriate levels of control.

Concerns raised by MPs about a reliance on a small number of providers reflect a broader recognition that concentration risk is an industry-wide issue in technology. Similar questions are now shaping policy across Europe, with a growing emphasis on interoperability, open standards and reducing lock-in.

The UK faces the same challenge: how to balance access to world-leading technology with the need for long-term resilience and autonomy.

The focus must now shift towards clearly defining which capabilities require assured control, where reliance on external partners is appropriate, and what safeguards are needed to manage long-term risk. Procurement approaches will need to evolve accordingly, placing greater emphasis on flexibility, interoperability and resilience alongside traditional measures of cost and performance.

These are no longer theoretical considerations. They are becoming central to how national resilience is defined.

Crucially, this is not just a public sector issue. Organisations across industries are making similar trade-offs as they adopt modern data and AI platforms, balancing speed and capability against flexibility, control and risk.

Control is the new bottom line

The Palantir debate has brought these issues into sharper focus, but it should be seen as a part of a much wider inflection point.

The most important technology decisions are no longer purely procurement decisions. They are strategic choices that will shape how resilient, adaptable and independent organisations, and nations, are in the years ahead.

This does not mean stepping back from innovation or global partnerships; it means approaching them more deliberately, with a clearer understanding of where control must sit, how dependency is managed and what happens if circumstances change, particularly in scenarios such as geopolitical tension, cyber incidents or supplier withdrawal, where access to critical systems cannot be left to chance.

Digital sovereignty is not about who builds the technology; it is about ensuring that control, accountability and resilience remain where they need to be.