Andy Burnham’s plan to gut the government department leading Britain’s AI strategy has prompted a fierce backlash from the tech industry.

Senior industry leaders warned that plans to abolish the Department for Science, Innovation and Technology (DSIT) and spread its functions between other departments would undermine the country’s AI strategy at a key moment.

In a letter to Mr Burnham, lobby groups Tech UK and Startup Coalition urged the incoming prime minister to rethink his plans, warning that breaking up the tech department would send a “terrible signal” and undermine the AI sector.

The UK Tech Cluster Group, another lobbying organisation, said breaking up DSIT would “create disruption at exactly the wrong moment”.

Tom Skinner, a former special adviser in DSIT under the previous government, said: “DSIT looks after the frontiers of all the technologies where the UK needs to excel.

“Understandably, the politicians’ focus will be on issues like nationalising the steel industry, or water companies, or post offices.

“But if the Government wants any growth at all, they’re going to need a growth miracle and the way to achieve that is by doubling down on all the things that DSIT looks after.”

Writing in The Telegraph, Julia Lopez, the shadow technology secretary, said the department was being “broken up in the knacker’s yard”.

Robert Jenrick, Reform’s Treasury spokesman, called Mr Burnham “a Luddite who cares more about hammering business and taking the country back to the 1970s with state control”.

In his first speech as Labour leader last Friday, Mr Burnham complained about the “deindustrialisation of the 1980s” but made no mention of AI or technology more broadly.

According to reports, Mr Burnham is considering redistributing DSIT’s functions across a beefed-up Department for Business and Trade and a bolstered Department for Culture, Media and Sport (DCMS).

Mr Burnham is expected to reward his allies with the briefs. Jonathan Reynolds, the current chief whip, has been lined up to lead the business department while Lucy Powell, who represented the incoming prime minister on media rounds on Sunday, is expected to take on the culture brief.

The senior Labour source said she had pitched for a “big department to run”, which could explain Mr Burnham’s potential expansion of DCMS to include some aspects of AI and science policy.