Government response to Business and Trade Sub-Committee report is "inadequate" for threats to national economic security

Government rejects reforms as threats from hostile states mount

The Commons Business and Trade Committee today warns the Government's response to the Committee's landmark economic security investigation fails to meet the threats Britain now faces and cautions the UK risks becoming "the weak link in Western economic security defences."

Ministers fully accepted only four of twenty-five Committee recommendations. In a world where cyber-security, trade and economic policy are increasingly weaponised as tools of political coercion, the Committee is deeply concerned about Government's flat refusal even to draw the line on where the UK's acceptable or unacceptable foreign dependencies lie.  

In its response to the Committee's landmark report, the Government ruled out giving critical certainty on which supply chains and capabilities the UK must maintain as sovereign - leaving questions about its own strategic clarity but also leaving industry in the dark about where to commit resources.  

Allied governments "extremely concerned"

The report reveals allies have raised concerns with the Committee about shortcomings in the UK economic security defences. While the EU, Japan and US create disciplined models with clear risk prioritisation and strong enforcement, the UK relies on "a loose collection of initiatives not a governing system."

Critical gaps identified

Ministers refuse to specify which foreign dependencies are unacceptable or which sovereign capabilities are essential - leaving industry in the dark. The Government has rejected cross-Whitehall stocktakes, systematic scenario planning, and dedicated economic security legislation adopted by allies, and refused to provide backstops to the cyber-insurance market despite the need for huge government subsides last year. 

On deterrence against economic coercion, the response sets out no clear triggers, response options, or consequences for hostile actors. The Committee highlights weak safeguards against Chinese subsidies - "a material concern to our allies in the EU."

Rt Hon Liam Byrne MP, Chair, said: "Economic security is the foundation of national security. Our allies are building the institutions and enforcement capabilities to match. Britain is not - and allies are deeply worried.

“Before World War II, the UK had to assemble new defences against the risk of economic threats. Our allies have learned that lesson better than us. We have not yet assembled an economic security system that meets the threat of the future. 

“Economic security is not a slogan. It means clear rules, real consequences, and the capacity to act when Britain is targeted. Until ministers move from acknowledgement to action, we will remain vulnerable in a world that is getting harder by the day. Allies fear Britain is becoming the weak link. Ministers must prove them wrong and take steps now to strengthen our defences."