​The battle against "electronic warfare" is being hampered - because GCHQ can't get the right staff, a hard hitting report said today.

The threat to Britain from electronic warfare must be treated “very seriously”, the Intelligence and Security Committee (ISC) urged.

Government information, national infrastructure and private firms are at risk from state-sponsored attacks, many from China and Russia, the cross-party parliamentary committee said.

In its annual report on the work of the UK’s security agencies, the ISC warned the threat posed was “a matter for concern” that needed to be given a high priority.

Work by GCHQ to tackle the problem had yielded “tangible benefits”, it said.

But it was well below the capacity initially planned because of problems with the recruitment and retention of specialist staff.

“The potential threat posed to the UK Government, critical national infrastructure and commercial companies from electronic attack is a matter for concern,” the committee said.

“We have heard from our American and Canadian counterparts that they treat this threat very seriously, and we recommend that the UK accord it a similar priority and resources.”

The Centre for the Protection of National Infrastructure, a Government agency, told the ISC that foreign intelligence services, particularly from China and Russia, were behind “large-scale” electronic attacks.

Their aim is to steal government, defence and technology information. Most large firms have been targeted and, in “many cases”, the attacks have been successful.

Islamist terrorists are also behind attacks via the internet. Although their efforts are more limited, they are on the increase.

GCHQ, based in Cheltenham, set up the Network Defence Intelligence and Security Team in 2008 to provide detection, analysis and investigation into electronic attacks.

The ISC said it had been informed of “a number of tangible benefits, both in terms of practical emergency responses for government networks and developing a better understanding of the future threat”.

But it went on: “Nevertheless, work to tackle the threat of electronic attack is about a third below the level planned.

“We have been told that the shortfall is because of the difficulties GCHQ has had in recruiting and retaining skilled internet specialists in sufficient numbers – although specialist recruitment campaigns have been set up to try and address this problem.”

The ISC said it had been unable to assess a new cyber security strategy introduced last summer. That includes a UK Office of Cyber Security (OCS) and a UK Cyber Security Operations Centre (CSOC) established in September.

In its response to the report – presented to the Prime Minister in December but published today – the Government said it agreed that the electronic threat was “a matter for concern”.

It said the OCS and CSOC had been “tackling early priority areas in support of the cyber security strategy”.

“OCS provides strategic leadership and cross-government coherence in this area, and CSOC co-ordinates significant cyber security incident response, enables a better understanding of attacks and provides improved advice and information about the risks,” the Government said.

“The Centre for the Protection of National Infrastructure (CPNI) also works closely with OCS and CSOC in this field. It provides advice to businesses and organisations across all sectors of the UK’s critical national infrastructure, helping to mitigate risk and reduce vulnerability to threats in the cyber domain.

“It also provides them with warnings, alerts and assistance in resolving serious IT security incidents.

“CPNI has a further ’response’ function: it is available 24/7 to act as a reporting point for UK companies with concerns about potential national security threats, including cyber attack.”

The ISC also raised concerns about a decline in spending on counter-espionage, or hostile foreign activity (HFA), by MI5. Specific figures were redacted from the report.

The Security Service’s director general, Jonathan Evans, told the committee he would like to spend more on HFA but resisted ring-fencing the budget because of the need to be able to redirect resources quickly in response to specific threats.

He said: “I would like to do more on HFA, because I think there are unanswered questions out there and ones which are slow-burn rather than rapid problems, and if you ignore them for long enough they are likely to cause us problems.”

But he added that MI5’s resources need to “go where the operational demand is that day, and it’s very flexible and we can change it around by lunchtime if we need to”.

The ISC said: “We accept the view of the Security Service that ring-fenced funding would limit its operational flexibility.

“However, as we stated last year, we are still concerned that counter-espionage is not sufficiently resourced in light of the levels of hostile foreign activity in the United Kingdom.

“This is a serious threat that must not be overlooked.”