Government in the AI era
Technological breakthroughs, particularly in artificial intelligence and automation, are redefining what is possible in governance. But even as AI assumes a greater role in governmental operations, it can never replace the dedication, judgment, or empathy that defines public leadership. When implemented responsibly and strategically, AI can optimize the ability of public servants to deliver impact at scale, anticipate crises, and deliver more tailored services and experiences for constituents.
A new IBM Institute for Business Value (IBM IBV) survey of senior government technology leaders shows that governments currently dedicate an average of almost 8% of their IT budgets to AI technologies. This share is expected to climb to more than 13% by 2030—an increase of nearly 70%. And by the end of the decade, that spending is expected to shift decisively toward generative AI and agentic AI tools.
Leaders estimate that less than one-quarter of their organizational data is AI-ready today and only about 7% of total data is actively used by AI. At the same time, they say between 50% and 80% of their enterprise data could be valuable if properly prepared—a reminder that the current constraint lies not in technology but in the structure and accessibility of information itself.
While an average of 63% of enterprise data is identified as valuable and 24% has already been prepared, only 7% is actually being used with AI today.
In what ways are government balancing the potential risks and rewards of adopting AI?
69% of public sector executives acknowledge that the potential productivity gains from AI-driven workflows and automation are so great they must accept significant risk to keep pace. And nearly nine in 10 plan to accelerate transformation despite uncertainty. The message is clear: inaction is an unacceptable risk.
69% of government executives acknowledge that the potential productivity gains from AI and automation are so great they must accept significant risk to keep pace.
What is the share of government-collected data currently leveraged by AI systems and how much of this enterprise data could be useful?
Today only about 6% of government data is actively used by AI systems. This indicates that the full organizational value of AI-driven technology remains largely untapped. However, as investments in data management, quality, and governance mature, leaders expect 50% to 80% of enterprise data to become useful for AI applications.
Where are the most critical areas for government leaders to focus on during their AI development journey?
62% of government services leaders point to workforce and talent and development as their top concern, followed closely by the need to build out ethical, legal, and regulatory frameworks for AI solutions, which is cited by 55% of government technology executives.
62% of government executives point to workforce and talent development as a critical area to focus on during the AI readiness journey.
Why should governments treat data as national infrastructure?
Government data is a public good. Governments must define and manage datasets to help ensure interoperability without sacrificing sovereignty. Federated data fabrics can connect critical systems—such as healthcare, transportation, and security systems—to support real-time situational awareness and decision-making while protecting privacy. Countries that treat data as strategic infrastructure will move from reactive to predictive governance.
How can AI-enabled tools improve government resilience to shock events?
In a world of continuous disruption, resilience is a strategic imperative. AI-powered digital twins and predictive analytics allow leaders to simulate crises and test responses before incidents occur. Governments must embed this capability into infrastructure planning, supply chain management, and social service delivery. Anticipation, not reaction, will define the next generation of governance and public services.
When should agentic AI be integrated into core government missions?
To scale AI capabilities responsibly, government agencies should start by building standard governance models that define where AI acts autonomously and where human oversight is required. By embedding AI agents into core missions—such as policy design, emergency response, benefits processing, and other high-impact use cases—leaders can achieve measurable productivity and decision quality gains. Early adopters will set the public trust and transparency standards for others to follow.
Download the report to learn how bold investments in AI adoption, along with ethical leadership and strong partnerships, can build governments that are not only more efficient and secure, but also more personal, inclusive, and resilient.
