Coventry city council has renewed a contract with Palantir despite opposition from councillors and trade unions.
The AI and analytics giant, whose technology is used by the Israeli military and by ICE to power US president Donald Trump’s immigration crackdown, will receive £750k in the deal.
The contract is an extension of an original 12-month pilot scheme, valued at £500k and signed in September 2025, for work in the children’s services department.
Despite trade unions warning that the agreement posed “serious ethical questions” and calls by councillors to cancel the contract, the Labour-run council said it has “decided to extend its Strategic AI Platform contract for a further year”.
Co-founded by billionaire Peter Thiel and built with CIA funding, Palantir holds more than £600m in contracts with public bodies in the UK, including a £240m deal with the Ministry of Defence and a £330m contract with the NHS.
It also has a number of smaller contracts with local councils and services in the UK, including Bedfordshire and Leicestershire police forces.
“When you outsource judgment about vulnerable children to a surveillance company, you are reaching into the very core of local democratic accountability” Labour MP Clive Lewis told The Nerve.
“These are decisions that should be made by trained, experienced social workers embedded in their communities – not by an algorithm built by a firm whose first clients were spy agencies.”
Independent MP for Coventry South Zarah Sultana posted: “Labour-run Coventry city council has just handed £750,000 to Palantir – a company that profits from hunting immigrants for ICE and produces ‘kill lists’ for the Israeli military.
“A company lobbied for by Mandelson himself. Shame on them.”
A spokesperson for Coventry city council said the pilot had reduced admin, freeing up social workers to spend more time with residents and providing cost savings.
The council insists “strong safeguards are in place” to protect resident data. “No data is shared with third parties or used to train AI models. AI supports staff but does not replace professional judgement – there is no automated decision-making about residents,” the spokesperson said.
Tom Midlane is a freelance journalist.
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