The government has “no strategy” to tackle the threat from China and has left the UK “severely handicapped” due to its “short-termist approach”, a new report has claimed.

The Intelligence and Security Committee has published its work on the threat the country poses, saying China has managed to “successfully penetrate every sector of the UK’s economy”.

But it pointed a lot of fingers at Whitehall, saying resources invested into tackling the threat were “completely inadequate” and the “slow speed leaves a lot to be desired”.

The committee, made up by MPs from across parties, said interference from the Chinese government in the UK was “not hard to detect”, but departments “may not previously have been looking for it” – and agencies were focused on overt operations rather than interference activity.

“The UK is now playing catch up and the whole of government has its work cut out to understand and counter the threat from China,” it said.

“The government told the committee that its response to the threat is ‘robust’ and ‘clear eyed’.

“China experts were rather less complimentary, concluding that the government has no strategy on China, let alone an effective one, and that it was singularly failing to deploy a ‘whole-of-government’ approach – a damning appraisal indeed.”

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The committee’s report said Chinese state intelligence targets the UK “prolifically and aggressively” and in a way that poses a “challenge” for British intelligence agencies.

The report, published on Thursday, said the UK is of “significant interest to China when it comes to espionage and interference”, placing the country “just below China’s top priority targets”.

“China’s state intelligence apparatus – almost certainly the largest in the world with hundreds of thousands of civil intelligence officers…. targets the UK and its interests prolifically and aggressively, and presents a challenge for our agencies to cover,” it said.

The government has been accused of sitting on the sensitive report after the ISC launched its inquiry in 2019 and sent a draft to the prime minister on May 15.

In response, Mr Sunak today welcomed the committee’s report and “proposals for further action”.

“They are rightly challenging,” he said. “We are alive to the need to make effective use of the new legislation and powers that we have introduced and to continue adapting our approach and actions to meet the challenge that China presents.

“In concert with our international partners we will continue to engage with China to preserve and create space for open, constructive, predictable and stable relations that reflect China’s significance in world affairs and to ensure our interests and those of our allies are best advanced.”

Mr Sunak said China poses an “epoch-defining challenge to the international order”.

He added: “Wherever China’s actions or intent threaten the national interest, we will continue to take swift action.”

The prime minister’s statement concluded: “The government will consider the committee’s recommendations and conclusions with care to assess where further action should be taken.

“We will publish a full response in due course and in the usual manner.”