ok, first of all, the pricing you quote is just a clickbait, because 20 USD is the price of individual licences, and volume licencing is entirely different, while volume licence pricing when you're negotiating with a GOVERNMENT can be completely unrelated to retail pricing - see the latest deal with Trump administration struck to offer ALL federal agencies access for a whole year, for the total sum of $1 per agency. In fact, a corporation of this size and this... intent, would be even happy to PAY a government (at least for some time) to have their system used widely in order to get their fingers into this warm, luvely, mega-pie. Clearly though, if the deal didn't happen, they wanted money, which the uk gov didn't want to part with.
On one level, such a deal might LOOK like attractive from any government's point of view, as you're buying 'your' population a 'cheat' to get ahead of all others and - in theory at least - this might convert into some wide-ranging economic benefits hard to predict. In theory. As to the users themselves, well, such 'free' offer would be similar to the drug-dealing 'the first one's free!' which might have unpredictable social and political side-effects once the licence expires.
And all that skipping the core uncertainty: very much unproven and potentially dubious benefits of AI furiously peddled by the AI evangelists who try to cash in on the hype.