Criminals and foreign spy agencies launched more than 1,000 cyber attacks on the Ministry of Defence last year in an effort to steal secrets and disrupt services, Liam Fox has revealed.
In a speech on Tuesday night, the defence secretary laid out the growing threat to the country from cyberspace, saying that government departments were now under sustained attack.
He underlined the problem by saying that "across the core defence networks there were an average of over a million security alerts every day".
These comprise mainly of spam emails that are blocked before entering government computer systems. But many turn out to be deliberate attempts to infiltrate and steal from the MoD's computer systems.
Last week the Guardian revealed that the UK is now developing a cyber weapons programme to give ministers an attacking capability in cyberspace.
It also emerged that the FBI is investigating allegations that the Google mail accounts of senior US government officials have been attacked by Chinese hackers.
In his speech, Fox set out why the government had committed an extra £650m for cyber security in last year's Strategic Defence and Security Review. He also warned more would need to be done to protect the UK's core infrastructure from cyber attack.
"Between 2009 and 2010, security incidents more than doubled," he said: "Was this in Afghanistan? No. This was in cyberspace and the target was the MoD. I and my senior colleagues are routinely alerted to incidents that could have had severe consequences if they'd not been stopped.
"Our systems are targeted by criminals, foreign intelligence services and other malicious actors seeking to exploit our people, corrupt our systems and steal information.
"To give you an idea of the challenge, last year we in the MoD blocked and investigated over 1,000 potentially serious attacks. "
Fox described it as the "war of the invisible enemy" and said the boundaries between government, business and every individual internet user were becoming blurred."This threat is growing in scale and sophistication. My department is a prime target. Across the core defence networks there were an average of over a million security alerts every day."
He said the opening of a new Global Operations and Security and Control Centre would help to coordinate the Whitehall response to cyber attacks, but conceded that government could not do this alone.
"We now see weekly reports of cyber attacks against businesses, institutions and networks used by people going about their daily lives," he said. "The cost to the UK economy of cyber crime is estimated to be in the region of £27bn a year and rising. These are attacks against the whole fabric of our society.
"There is no Maginot Line in cyber space ... our national intellectual property in defence and security industries is at risk from a systematic marauding. Not only could it severely affect the future success of British industry, our economic advantage, and the country's financial recovery, but also directly impacts upon our national security today."
Last week, the US government said it was intending to rewrite its military rule book to make cyber-attacks a possible act of war. In May, the chancellor George Osborne said foreign intelligence agencies were carrying out cyber-attacks on the Treasury, targeting it with programs designed to steal information.
Some experts have warned against government's over-exaggerating the problems in cyberspace, noting that 80 per cent of all such attacks can be thwarted with better computer 'hygiene' – such as people using less obvious passwords.
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