- DEPUTY NATIONAL SECURITY ADVISER: Because the process that we used through the Investment Security Group is intended on a case-by-case basis to look at individual Foreign Direct Investments into the UK. That is not to say that the broader questions were not discussed or were not part of the equation. As I say, I have not seen the minutes of the [NSC] discussion from that time but certainly the advice that we gave as intelligence professionals and security professionals was on the basis of the Hinkley project.[1]
This is astonishing. If correct, then it raises very serious questions as to the basis on which the Government is allowing foreign companies into our CNI—and shows that lessons have not been learned.
- Numerous sources indicate that China's investment in Bradwell B is contingent on its investment in Hinkley Point C. Furthermore, this assessment was available to Government in 2016 when investment in Hinkley Point C was being considered. We would have expected this information to have been a principal factor in the Government’s decision-making process. However, the omission of any reference to it in the 2016 Cabinet Office note suggests otherwise.
- We asked why the linked investment had not been highlighted to Ministers and were told that there had been no investment security process undertaken in relation to Bradwell B and that each case was looked at on its own merits.[2]We then requested sight of the NSC minutes on the Hinkley Point C decision to ascertain whether the linked investment in Bradwell was discussed. The (then) Prime Minister refused to provide these, on the grounds of Cabinet collective responsibility.[3]
- Our concerns on this matter are grounded in experience: in 2013 this Committee held an Inquiry into the decision to allow BT to purchase Huawei telecommunications equipment. The Committee concluded:
The Committee’s investigation into the handling of the BT/Huawei case highlights a number of weaknesses in the UK's approach to investment in the Critical National Infrastructure (CNI). The Government's duty to protect the safety and security of its citizens should not be compromised by fears of financial consequences, or lack of appropriate protocols. However, a lack of clarity around procedures, responsibility and powers means that national security issues risked, and continue to risk, being overlooked.
The BT/Huawei relationship began nearly ten years ago; the process for considering national security issues at that time was insufficiently robust. The Committee was shocked that officials chose not to inform, let alone consult, Ministers on such an issue.[4]
It appears that, by 2016, the Government had still failed to take action, and that security decisions were still being compromised in a way that leaves the UK at risk.
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