October 18, 2010 / 1:46 PM / in 7 years

Terrorism, cyber attacks top UK security threats

LONDON (Reuters) - Cyber attacks, terrorism, inter-state conflict and natural disasters are the top threats to British security, officials said on Monday, before a major military review expected to usher deep defense spending cuts.

<p>A general view of the Global Response Centre of the International Multilateral Partnership Against Cyber Threats (IMPACT) in Cyberjaya September 10, 2009. REUTERS/Bazuki Muhammad</p>

A new National Security Strategy highlighted threats from al Qaeda and Northern Ireland-linked groups, as the government sought to convince critics that an armed forces review due on Tuesday is policy-driven, and not a money-saving exercise.

The report also said the Olympic Games, which London will host in 2012, would “be an attractive” target for disruption.

“Our strategy sets clear priorities -- counter-terrorism, cyber (attacks), international military crisis, and disasters such as floods,” the government said in its report entitled “A Strong Britain in an Age Of Uncertainty.”

The government is trying to reduce a record budget deficit of nearly 11 percent of national output while keeping Britain a strong military power in Europe and a capable ally of the United States, which it has backed in wars in Iraq and Afghanistan.

The focus on unconventional threats is likely to be used to justify cuts to big military hardware orders.

“Our most urgent task is to return our nation’s finances to sustainable footing,” the report said.

Britain will aim to strengthen security ties with other nations, particularly emerging ones such as China and India, and will spend some 500 million pounds ($794 million) on a “transformative” programme for cyber security.

Cyber attacks include criminal activity for financial gain, as well as attacks by state and non-state groups that could disrupt military, transport, utility and other networks.

The report explains the principles underpinning a Strategic Defense and Security Review due on Tuesday, the first since 1998, which critics say has been rushed and ill-thought out.

<p>A notice on an underground tube train advises passengers to report 'unattended items or suspicious behaviour' in London, October 18, 2010. REUTERS/Luke MacGregor</p>

INDUSTRY SHIFT

“It’s pretty much areas one would have expected them to highlight ... What’s going to be interesting is what kind of reductions we see over the next four or five years and the number seems to settling around 8 percent,” said Zafar Khan, an analyst at Societe Generale.

Negotiations between the Ministry of Defense and the Treasury have resulted in cuts of less than 10 percent over four years in a defense budget of 36.9 billion pounds.

This is well below cuts averaging 25 percent expected in most departments’ budgets, but will still lead to reductions, delays or cancellation of major hardware orders.

This will be a boon for software and security firms, while some traditional hardware manufacturers are re-positioning themselves. British firm BAE Systems recently acquired L-1 Identity Solutions’ U.S. counter-terrorism business.

“We welcome the fact that the government has recognized the need to invest in cyber security, intelligence and counter terrorism, three areas where we have allocated increased resources,” said Andrew Thonis, head of defense technology firm Cohort.

Shares in the firm ended 6.6 percent higher at 64.5 pence.

Threats in the National Security Strategy report were split into three tiers, with those threats that are most likely or would have the deepest impact at the top.

The report relegated threats from insurgencies abroad that could foster terrorist attacks in the Britain -- such as the Taliban harboring al Qaeda in Afghanistan -- to a lower, “tier two” level priority.

Other threats highlighted were nuclear proliferation, organized criminal networks and attacks on UK space satellites.

Officials at the unveiling of the new security strategy gave little indication of the contents of Tuesday’s military review.

Additional reporting by Michael Holden; Editing by Alison Williams

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