Deputy Prime Minister to boost economic defences against threats to British economic model
Deputy Prime Minister warns UK is “in cyber and economic contestation with an increasing range of state and non-state actors”.
- Government to launch a dedicated analytical team to deepen understanding of potential risks of outward investment in sensitive sectors
- Bolstering crisis capability to prepare for future economic security shocks- Response to ‘Call for Evidence’ on the National Security and Investment Act (2021) to be published
The Deputy Prime Minister, Oliver Dowden, will warn today in a speech at Chatham House, “while the financial crash exposed the economic risks of globalisation, today’s rising geopolitical competition is demonstrating the security risks behind such integration.”
He will say “we must be clear eyed that one of the great strengths of our system is its openness, but that also brings vulnerabilities. Covid and Russia’s war on Ukraine both laid bare the interconnectedness of global supply chains and the extent to which they can be exploited, such as Russia driving up the price of gas, and Chinese acts of economic coercion.”
The Deputy Prime Minister will also announce new steps to boost the UK’s economic defences, including a consultation run by the Department for Business and Trade on improvements to export controls on emerging technologies alongside steps to deliver more efficient and transparent decision-making for business.
The Department of Business and Trade will launch a review team to better understand potential risks from Outward Direct Investment (ODI), update National Protective Security Authority guidance to highlight the risks, and issue guidance on how the Government’s existing powers can potentially be used to mitigate this risk and evaluate whether further powers are required.
He will also announce measures to enhance crisis capability within Government, backed by funding from the Economic Deterrence Initiative. This includes new plans to increase stress testing and exercising within Government, and increase the number of security cleared analysts across Government announced in the Integrated Review Refresh. This will ensure departments are better equipped to respond to future economic security shocks similar to the Russian invasion of Ukraine in 2022.
Today, in line with the Deputy Prime Minister’s commitment to take “precise and proportionate action” the Cabinet Office is also publishing its response to the Call for Evidence on the National Security and Investment (NSI) Act (2021) which ran between November 2023 and January 2024.
He will say that the NSI Act continues to function well, but the Cabinet Office will bring forward updates to fine-tune the system to ensure it stays ahead of the threats facing the UK, and remains as pro-business as possible, without compromising the Government’s ability to conduct proper scrutiny and protect our national security. This includes considering a small number of targeted exemptions from the Act’s mandatory notification requirements, the publication of further guidance, and a new consultation on updates to the mandatory area definitions, which set out the areas of the economy subject to the NSI Act’s mandatory notification requirements. This is likely to include proposals for new areas for both critical minerals and semiconductors.
The Deputy Prime Minister will also announce the Government will launch a new online tool to help small businesses - such as tech startups or university spinouts - identify and fix gaps in their security. The Secure Innovation Personalised Action Plan, designed by the National Protective Security Authority (NPSA) and the National Cyber Security Centre (NCSC), launched this week.
Ends