Cyber crime 'costs �27bn a year'

17 February 2011 Last updated at 05:51 ET

Cyber crime costs the UK economy �27bn a year, the government has said.

The figures, published for the first time, are a mid-range estimate and the real cost could be much higher.

They are made up of �21bn of costs to businesses, �2.2bn to government and �3.1bn to citizens.

Security minister Baroness Neville-Jones said the government was determined to work with industry to tackle cyber crime.

At the moment, cyber criminals are "fearless but they do not think they will be caught", she said in a briefing in central London.

'Frightening'

But efforts to get a grip on the problem had been hampered by firms who did not want to admit they had been the victims of attacks for fear of "reputational damage".

This also meant that it was difficult to accurately estimate the cost to the economy - and "worst case scenario" was likely to be much greater than �27bn.

"It is a bit like terrorism - the more you know the more frightening it looks," said Baroness Neville-Jones.

But she said the government was not at "panic stations", adding that it had a strategy to tackle the problem and had committed �650m over the next four years to it.

Prime Minister David Cameron and Foreign Secretary William Hague had met the bosses of some of Britain's biggest businesses, including Barclays, HSBC, Tesco and BA, on Monday to urge them to take the problem more seriously.

Baroness Neville-Jones said ministers would be unveiling a plan to disrupt cyber criminals and ensure more of them were prosecuted "in the spring" and had agreed to form a joint working group with industry to tackle the problem.

Martin Sutherland, chief executive of Detrica, the consultancy which compiled the report with the Cabinet Office, said the perpetrators of cyber crime ranged from "state-sponsored" activists to organised crime gangs down to "spotty teenagers sitting in their bedrooms".

Nearly half of the �21bn cost to business was made up of intellectual property theft - which included illegal downloading and file sharing. But industrial espionage, such as the theft of designs and commercial secrets, was also a significant problem.

The hardest-hit sectors were pharmaceuticals, biotech, electronics, IT and chemicals.

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