The ‘China Audit’ one year on: Clarification, procrastination, or obfuscation?
Part 3: Seeking truth from acts
The Thinker | No. 08/2026
This article is the third part of a mini-series analysing the ‘China Audit’ one year after the publication of His Majesty’s (HM) Government’s National Security Strategy. Part 1 can be read here, and Part 2 here.
Strategy and tactics are powerful weapons with which our Party leads the people in transforming the world, changing practices, and driving historical progress.
– Xi Jinping, General Secretary of the Chinese Communist Party (CCP), 7th February 2023
Labour’s 2024 general election manifesto promised to ‘improve the UK’s [United Kingdom] capability to understand and respond to the challenges and opportunities [the People’s Republic of] China [PRC] poses through an audit of our bilateral relationship.’ A year later in June 2025, David Lammy, then Foreign Secretary, presented the results to Parliament, declaring that ‘the audit is less a single act than an ongoing exercise which will continue to guide the UK’s approach to China.’ On the anniversary of the ‘China Audit’, how continuous and clear is that guidance?
Aims and intended outcomes
The Foreign, Commonwealth, and Development Office (FCDO), charged with carrying out the Audit, spoke of promoting four aims in the conduct of Britain’s relations with the PRC (discussed at an FCDO briefing on 23rd January 2025):
Secure growth of the UK’s economy;
National and international security;
Climate change and energy issues; and
Encouraging the PRC to play a responsible role in the international rules-based order.
These form a knotty nexus. Trade and investment can cut across security concerns, and climate change emission targets may contradict long-term economic or national security considerations. These contradictions exemplify why the UK needs a PRC strategy – more so than it does for dealing with the United States (US), the European Union (EU), or Russia. Britain shares interests, values, and history with the first two, while relations with Russia are uncomplicated, if antagonistic. Lammy spoke of Chinese ‘attacks on the rules-based order’, begging the question of how to encourage the PRC to play a responsible international role, given its very different values and interests.
The audit was to have four outcomes:
A public document about the China Audit and British interests. This would be limited in scope;
A non-public ‘Strategic Framework’, guiding government departments (ministries) in how to pursue the UK’s interests;
Clearer guidance to business, academia, Parliament, and society on how to engage with the PRC; and
A review of PRC expertise, both inside and outside government, consideration of how better to ensure that His Majesty’s (HM) Government could benefit from outside expertise, and how to ensure longer-term resilience.
HM Government’s progress report card
Space prevents a comprehensive look at all aspects of UK-PRC relations since the China Audit. Those mentioned by Lammy in his statement to Parliament have seen some limited progress.
‘On security, the audit described a full spectrum of threats’
Domestically, Lammy mentioned espionage, cyber attacks, transnational repression, and Critical National Infrastructure (CNI); internationally, the PRC’s aggressive behaviour in the South China Sea and towards Taiwan, and support for Russia in its full-scale invasion of Ukraine.
Lammy noted that ‘We are updating our state threats legislation, following Jon Hall’s review’, the need for which became obvious when HM Government could not bring itself to deem the PRC a threat for the espionage trial of Chris Cash and Chris Berry later that autumn. However, whatever the final National Security (State Threats) Act says (it is still before Parliament), whether the PRC is recognised as a threat and whether action is taken will remain a question of political will.
Other responses to the security threats included an increase in funding for the intelligence services of £600 million. This covers the spending review period up to 2028-2029, translating into an annual increase of below 15%. HM Government has tightened and made more precise the National Security and Investment Act, and has increased sensitive sectors of CNI from 17 to 19.
There has been a small uptick in calling out the PRC over cyber attacks. The CEO of the National Cyber Security Centre (NCSC) has said that it managed over 200 incidents in 12 months, 75% identified as coming from state actors. Assuming that a third of those might be Chinese, this is not a vigorous policy of shaming, although there may be operational security reasons for not calling out each and every attack.
HM Government has also not been loud in calling out the extent of Beijing’s support for the Kremlin, although it has started to sanction Chinese companies – around 20 since the China Audit.
Trade and investment
Critics of HM Government’s policy on trade should acknowledge the Audit’s intention to promote exports. It commends Joint Economic and Trade Commissions and ‘the launch of a new online hub bringing together detailed and specific business advice’. Speaking of ‘the important role China can play in delivering UK growth’ may be optimistic, given CCP policies of self-reliance, dual circulation, and ‘Made in China 2025’, which increasingly result in falling imports. It is also pertinent to ask whether the difficulties of exporting to the PRC mean that HM Government should be putting more effort into supporting exports to Japan, South Korea, and Taiwan, as these collectively add up to around the same as exports to the PRC. While ministerial support and visits are welcome, the efforts of businesses themselves are what determine exporting success.
Ministers and officials continue to say that Chinese investment is crucial to British growth prospects. Yet, according to most recent figures from the Office of National Statistics (ONS), of the stock of foreign investment in the UK over the last 25 years, only 0.1% is Chinese (the ONS methodology almost certainly understates the figure, but even at 1% or 2%, it is not high). The future may not be different: a failing Chinese economy is likely to invest less than in the past. Meanwhile, Chinese companies invest not to dispense charity, but to obtain technology. Others – connected vehicle manufacturers would be an example – would introduce technology to the UK. In both cases, security grounds suggest rejecting the investment.
Values and the rule-based order
The China Audit claimed that HM Government would continue to confront the PRC on destabilising activity in the South China Sea, abuses of freedom of navigation, human rights in Xinjiang and Tibet, and commitments under the Sino-British Joint Declaration on Hong Kong. It would not change Britain’s position on Taiwan.
Ministers claim that they raise these issues in meetings with opposite numbers. No doubt they do, although the terms and vigour are not known. However, the CCP no longer listens, no matter which country speaks. Actions are what count, such as sanctioning those responsible for human rights abuses, or making it clear in advance that an invasion or blockade of Taiwan would lead to a panoply of economic sanctions.
Domestically, actions such as excluding Confucius Institutes from universities, ensuring that the Chinese Students and Scholars Association acts as a normal university society and not an arm of the CCP and its United Front Work Department, and full reciprocity over visas for journalists, would make good the China Audit’s claims of protecting British values.
The final part of this mini-series, to be published shortly, looks at the failure of HM Government to live up to the aims of the China Audit, and offers some recommendations for filling the gaps.
Charles Parton OBE is Chief Adviser to the China Observatory at the Council on Geostrategy, and Senior Research Fellow in International Security at RUSI.
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