Former Conservative leader Sir Iain Duncan Smith has attacked Labour’s decision to drop charges against two men accused of spying for China, warning that Britain’s national security is being undermined by the government’s refusal to classify Beijing as a hostile state.

Speaking in the Commons during a debate on the Official Secrets Act, Sir Iain said he had been assured the prosecution was a “slam-dunk” case.

He claimed prosecutors had “met every single requirement within the Official Secrets Act about passing secure information to the Chinese intelligence agency that would be directly or indirectly useful to the Chinese state.”

He questioned why the Crown Prosecution Service (CPS) had abandoned the case, insisting it could not be because of a lack of evidence.

Sir Iain, who has himself been sanctioned by Beijing, said the problem lay with the way the law defines an “enemy.” He accused ministers of weakness for refusing to place China in the same category as Russia, North Korea and Iran following the government’s audit of relations.

“The Labour Government had the chance to put China in the same upper tier as Russia, North Korea and Iran — but chose not to,” he said. “Ministers call China a ‘challenge’, not a threat. That position is indefensible. The Minister speaks of threats, but he does not say that China is a threat; he says it is a ‘challenge’, which is a ludicrous position to take.”

Sir Iain added that the collapse of the case had “let down Parliament and, indeed, Mr Speaker himself, who stood up for Members targeted by Beijing.”

He warned: “Until China is recognised for what it is, a persistent threat to individuals and states, our national security will remain compromised, and our reputation weakened as a strong state against terrorism.”

The CPS has said it does not comment on individual charging decisions.

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