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

Government’s Cloud Reliance Faces Scrutiny After Global AWS Disruption

This week’s widespread Amazon Web Services outage has laid bare the UK government’s deepening dependence on the cloud computing giant, raising urgent questions about national infrastructure resilience and regulatory oversight. The disruption affected thousands of businesses globally and highlighted what procurement data reveals to be a £1.7bn relationship between the British state and AWS since 2016.

The Scale of Government Dependency

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

Key ministerial departments relying on AWS infrastructure include:, according to recent developments

• Home Office
• Department for Work and Pensions
• HM Revenue & Customs
• Ministry of Justice
• Cabinet Office
• Department for Environment, Food & Rural Affairs

Regulatory Warnings Ignored

The situation presents what technology experts describe as a striking contradiction between government practice and regulatory guidance. Tim Wright, technology partner at law firm Fladgate, noted the irony: “That’s a very significant exposure considering how the FCA and PRA have repeatedly highlighted the dangers of concentration risk in cloud service provision for regulated entities for a number of years.”

This concern about concentration risk—where critical infrastructure becomes dependent on too few providers—has been a recurring theme in financial regulatory circles. Recent initiatives by HM Treasury, the Prudential Regulation Authority, and Financial Conduct Authority to establish direct oversight of ‘critical third parties’ were specifically designed to address the very type of risk manifested in this week’s AWS outage., according to recent developments

Political Response and Oversight Questions

The House of Commons treasury committee has taken direct 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 company to formal financial regulatory oversight.

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

Global Impact and Service Restoration

The outage’s reach was substantial, with Downdetector recording over 2,000 affected companies worldwide and 8.1 million problem reports. The UK experienced approximately 1 million reports of service issues, while the US saw 1.9 million and Australia 418,000.

Among UK government services, HMRC confirmed disruption, acknowledging that customers were “having problems accessing our online services” and experiencing busy phone lines. While most services were restored within hours, some organizations reported persistent problems throughout the day. Amazon confirmed by Monday evening that all cloud services had “returned to normal operations.”

Broader Concerns Beyond Technical Reliability

The incident has amplified existing concerns about Amazon’s suitability as a government partner. Unions have long questioned whether the company’s track record on working conditions should disqualify it from public contracts.

GMB union national secretary Andy Prendergast voiced strong criticism: “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 for fulfilment centers countered that the “vast majority” of ambulance callouts at its sites were not work-related., as additional insights

Strategic Implications for National Infrastructure

The outage occurs against a backdrop of increasing government-cloud provider collaboration, highlighted by Amazon CEO Andy Jassy’s June meeting with Prime Minister Keir Starmer to announce £40bn of UK investments. At the time, Starmer celebrated the partnership as evidence that “our plan for change is working.”

This week’s events suggest that the government’s cloud strategy may require reassessment. As Wright concluded, “Until significant diversification or sovereign cloud adoption occurs, the UK government’s own stance shows an uncomfortable contradiction with the very resilience principles regulators have advocated.”

The incident serves as a stark reminder that as digital transformation accelerates, the concentration of critical infrastructure in few hands creates systemic vulnerabilities that extend far beyond individual service disruptions.

References & Further Reading

This article draws from multiple authoritative sources. For more information, please consult:

• https://www.aboutamazon.co.uk/news/job-creation-and-investment/amazon-40-billion-uk-investment
• https://health.aws.amazon.com/health/status

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