Intelligence services under fire in squeeze on funding

The squeeze on budgets of most government departments announced in the Budget is likely to hit the intelligence services hard, and at a time when they are in as much demand as ever, according to Whitehall insiders.

The intelligence agencies and services cost roughly £3 billion a year — “very good value for money” according to chairman of the public accounts committee Margaret Hodge.

This includes the Security Service (MI5), the Secret Intelligence Service (often known as MI6), and the General Communications Headquarters in Cheltenham. GCHQ is able to enhance its budget with commercial contracts for work on cyber security. The intelligence services will be spared the full force of the cuts, but will still need to make savings as they seek to protect Britain. What worries counter-intelligence experts is the growing threat from al Qaeda. One expert in the field said: “The picture is about as grim as I can ever remember.”

He said new al Qaeda cells were taking root in eastern Afghanistan. This is likely to be aggravated by growing chaos in Pakistan as it approaches elections this year.

“The fact that there have been no major incidents in Europe itself means very little,” the expert said. “Their long-term intent remains the same — and we are targets.”

Special Forces face outright cuts under the Government’s Comprehensive Spending Review due to be announced in June. There are fears the Special Forces Support Group, based on 1st Battalion the Parachute Regiment, may be scrapped altogether.