UK critical systems cyber warning

14 September 2011 Last updated at 15:10 GMT Both government and private companies are criticised over their preparedness The UK government is failing to take a strong lead in protecting critical systems such as power and water from cyber attack, according to a leading think tank.

Chatham House said there was a reluctance to share information with institutions that might be targeted.

It also criticised those same institutions for putting up with an "unacceptably high level of risk".

The government said that it ranked cyber security as a top priority.

Last year it announced £650m of additional funding to help tackle computer-based threats.

Around £130m or 20% is specifically earmarked for critical infrastructure projects.

The Chatham House report questions what that money will be used for given that "the vast majority of critical infrastructure in the UK is privately owned."

There have been numerous warnings in recent years about the risk of computerised systems being vulnerable to attack.

The issue received additional prominence following the discovery of the Stuxnet worm which was used to damage systems used in Iran's nuclear programme.

Chatham House's review was based on a series of interviews with senior figures in companies considered to be part of the critical national infrastructure, such as electricity, oil and gas.

Many were searching for guidance, according to the report, but government had failed to create an "authoritative 'big picture'... that could help develop a more comprehensive and urgent sense of the cyber threats that need to be tackled."

It recommends that government assumes an "integral role in shaping the discourse, informing wider society and raising levels of awareness."

Private problem

The report also contains criticism of the private sector.

With large parts of the UK's infrastructure - such as nuclear and the power grid - being run by private companies, there was an expectation that they would be alert to growing online threats.

The reality was often very different, according to David Clemente, a cyber security researcher at Chatham House.

"Many only pay attention to it after something unpleasant has happened to them or a competitor and they realise they have to pay attention, perhaps throw some money at the problem," said Mr Clemente.

The report urges companies to make cyber security a key component of their risk strategy.

It also warns against cutting corners "in the pursuit of efficiency savings and improved quarterly returns."

In a statement, the Cabinet Office, which looks after the UK's cyber security strategy said: "Closer collaboration between the government and the private sector is crucial to protecting our interests in cyberspace, including critical national infrastructure."

The government is expected to announced a revised cyber security plan next month.

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Spending cuts hurt BAE Systems

28 July 2011 Last updated at 19:20 GMT The new RAF Nimrod is one of the BAE projects scrapped as a result of spending cuts Military spending cuts have led to a drop in profits at UK defence company BAE Systems.

Profits before tax for the first six months of the year were £691m, down from £781m a year ago, with global sales down 13% to £9.2bn.

Despite this, BAE announced a dividend rise of 7% and a share buy-back scheme.

BAE benefited from a one off payment of £125m from the UK Ministry of Defence in compensation for contract changes over the past nine years.

The company reached a separate settlement agreement with regards to the cancellation of the Nimrod surveillance jet and Harrier jet programmes, but did not disclose the numbers.

BAE also took a one off loss of £160m linked to a contract to provide an Omani patrol vessel.

Continue reading the main story The scheme to purchase £500m of its own shares was well received by investors, with BAE shares closing up by 4.9%.

Chief executive Ian King said the company would focus on new areas of business such as cyber weapons.

"We continue top pursue the fast lanes of growth in the areas of military and technical services, cyber and intelligence and high-end electronics," he said.

Analysts said the results were not as bad as they could have been given the spending cuts.

"These results are by no means a disaster, and the increased shareholder returns should be taken as a positive," said Andrew Gollan from Investec Securities.

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