The United Kingdom is facing one of its most politically charged national security controversies in years — a full-blown storm now dubbed the “China Spy Scandal.” The fallout began when the Crown Prosecution Service (CPS) abruptly dropped charges against two British men accused of spying for China.

What might have remained a complex legal decision has spiraled into a political firestorm, with Labour’s Security Chief, Bridget Phillipson, at the center.

Her handling of the case, and the government’s perceived failure to protect national interests, has ignited outrage across Westminster and beyond. Critics are demanding answers, while Prime Minister Keir Starmer insists on standing by his embattled minister, insisting she acted properly at every stage.

Bridget Phillipson sparked fury yesterday as she sought to blame the Crown Prosecution Service for the China spy scandal.

The Education Secretary also claimed Keir Starmer has ‘full confidence’ in his beleaguered national security adviser Jonathan Powell.

Ms Phillipson insisted that Mr Powell had played no role in the collapse of a prosecution against two alleged Chinese spies amid mounting scrutiny over the decision to drop the charges.

She admitted that the national security adviser did brief ministers on China but said he was not involved in discussions about the ‘substance or the evidence’ of the case.

Mr Powell – a diplomat and former chief of staff to Sir Tony Blair – has been blamed for the Government’s failure to state that China represented a threat to national security.

The prosecution against Chris Cash, 30, and Christopher Berry, 33, collapsed last month when the Government refused to classify Beijing as a threat to national security. Both men were formally declared not guilty and deny any wrongdoing.

The Prime Minister has claimed his hands were tied, blaming the previous Tory administration for not designating China an adversary at the time of the alleged offences.

But Britain’s most senior prosecutor said the case collapsed because Sir Keir’s administration refused to provide evidence that China is a national security threat to the UK in court.

The public and political backlash was immediate. Critics slammed the CPS for what they called an “unforgivable lapse,” accusing the agency of failing to coordinate with government departments and intelligence agencies to provide clear evidence. But it was Bridget Phillipson, Labour’s Security Chief and Education Secretary, who found herself in the direct line of fire.

As questions mounted about who was responsible for ensuring that the CPS had the necessary documentation, Phillipson’s office was forced to deny accusations of negligence and political interference. She maintained that her role was limited to policy oversight, not operational involvement, and that no member of the government had interfered in the prosecution’s decisions.

Phillipson’s explanation did little to calm her critics. Former Home Secretary Priti Patel called the case a “national embarrassment,” claiming that Labour’s government had been “too soft” on China and unwilling to confront the extent of Beijing’s espionage operations in the UK.

Conservative MPs seized on the collapse of the trial as proof that Labour lacked the resolve to defend British security interests. “This government talks tough on national security,” one MP fumed in Parliament, “but when it comes time to act, they hide behind process.”

For many onlookers, the scandal underscored a broader concern: that the UK’s institutions are ill-prepared to handle the growing threat of foreign interference in an increasingly volatile geopolitical landscape.

The controversy grew even deeper when reports emerged suggesting that internal government documents existed—though never presented in court—showing that intelligence agencies had indeed flagged China as a significant espionage threat during the relevant timeframe.

If those documents existed, critics argue, why were they not shared with the CPS? Some legal experts have called for a full independent inquiry to determine whether political caution or bureaucratic confusion led to the failure.

Meanwhile, Labour ministers insist that the legal issue was purely procedural: under the Official Secrets Act, a formal ministerial designation of “hostile state” or “enemy” must exist at the time of the alleged offences, and the government of the day—then under the Conservatives—had not issued one.

Bridget Phillipson sparked fury yesterday as she sought to blame the Crown Prosecution Service for the China spy scandal

The Education Secretary also claimed Keir Starmer has ‘full confidence’ in his beleaguered national security adviser Jonathan Powell

But yesterday Ms Phillipson was asked for assurances that Mr Powell played no role in the decision. ‘Yes, I can give that assurance,’ she told Sky News’s Sunday Morning With Trevor Phillips.

Asked what the purpose of Mr Powell’s role was if he was not advising on such cases, Ms Phillipson said: ‘He will be, but as I say, this was a decision taken by the CPS.’

And asked whether he had Sir Keir’s full confidence, she replied: ‘Yes.’

Ms Phillipson added: ‘The Crown Prosecution Service are best placed to explain why they were not able to bring forward a prosecution, but what I can be absolutely clear about is that ministers and others, including the national security adviser, had no role to play in either the substance of the case or the evidence in question, and evidential questions are matters for the Crown Prosecution Service.’

Shadow national security minister Alicia Kearns said the Government’s ‘attempts to blame the CPS are preposterous at this point’.

And Shadow Foreign Secretary Dame Priti Patel said it is ‘appalling’ that the ‘scrutiny-shirking’ Government is blaming the CPS over the collapse of the China spying case.

The White House is said to have concerns that the failure to prosecute the two alleged spies risks undermining the special relationship.

Christopher Berry leaves Westminster Magistrates’ Court, central London, where he appeared accused of an offence under the Official Secrets Act, Friday April 26, 2024

Starmer’s defence of Phillipson is as strategic as it is loyal. For the Prime Minister, admitting any degree of ministerial fault could not only weaken his government’s credibility but also inflame tensions with China at a moment when the UK is trying to balance national security with trade diplomacy. By standing firm behind Phillipson, Starmer hopes to project stability and confidence.

“This government will never compromise on national security,” Starmer declared in a press conference. “But we will also ensure that our legal processes remain independent and above political influence.” To his allies, it was a statement of integrity; to his detractors, it was a deflection.

Behind the political posturing, however, the scandal has exposed deeper systemic problems. Legal scholars warn that the Official Secrets Act, drafted decades ago, may no longer be fit for purpose in an era of digital espionage and hybrid warfare. The requirement for formal designations and explicit witness statements—rather than intelligence assessments—creates what one security analyst called “a dangerous blind spot.”

Without reforms, the UK could face more collapsed prosecutions, even as foreign operatives exploit legal grey zones. For intelligence professionals, the failure of this case is more than a legal setback; it is a signal that Britain’s counter-espionage framework is outdated.

Public confidence in the system has also taken a hit. Ordinary citizens, reading headlines about spies walking free and officials dodging blame, are asking whether the government truly has control over its own security mechanisms. Social media has been ablaze with criticism, much of it aimed directly at Phillipson.

Some accuse her of being naïve about the scale of Chinese infiltration; others argue she’s being made a scapegoat for a broader institutional failure that spans multiple governments. The emotional temperature of the debate has only risen with each passing day, reflecting growing public anxiety about both foreign threats and political accountability.

The prosecution against Chris Cash, 30, and Christopher Berry, 33, (pictured) collapsed last month when the Government refused to classify Beijing as a threat to national security

And pressure was mounting on Downing Street and Mr Powell after it was reported that intelligence agencies were prevented from directly submitting spying concerns about the proposed Chinese super-embassy near the City of London.

The planning application is being considered by ministers, but intelligence agencies have been prevented from submitting concerns to the Government because their evidence would be disclosed to Beijing.

The Tories called on Downing Street to reveal whether Mr Powell has been involved in talks to allow a Chinese company to build a wind turbine factory branded a threat to UK national security.

Ministers are still considering whether to approve the £1.5 billion investment by Ming Yang.

The company’s proposed wind turbine factory in Scotland, which was announced on Friday, would be the largest in the UK.

The case that sparked the uproar began with the high-profile arrests of parliamentary researcher Christopher Cash and teacher Christopher Berry. Both men were charged under the Official Secrets Act, accused of gathering and sharing information intended to benefit the Chinese state.

At first, the case seemed poised to become a landmark trial against foreign interference in British politics. But in a stunning twist, the CPS announced it was dropping all charges in September 2025, citing an “evidential failure.”

According to prosecutors, they could not secure the necessary witness statements confirming that China was officially recognized as a national security threat during the period the alleged spying took place. Without that legal foundation, they said, the case could not proceed.

Whether that argument will convince the public remains to be seen. What is clear is that the “China Spy Scandal” has become more than just a failed prosecution — it’s a prism through which questions about leadership, transparency, and national security are being fiercely debated.

It has exposed the fragile intersection between politics and justice, where the pursuit of truth often collides with the imperatives of diplomacy and law. As the dust settles, Bridget Phillipson may survive the political fallout, buoyed by Starmer’s backing.

But the larger issue — how Britain confronts espionage in an age of global rivalry — is far from resolved. And unless systemic reform follows, this scandal may mark only the first of many national security crises to come.