Huawei and 5G

Iain Duncan Smith Excerpts

Wednesday 4th March 2020 Westminster Hall

[Sir Iain Duncan Smith (Chingford and Woodford Green) (Con)]

I beg to move,

That this House has considered the security implications of including Huawei in 5G.

It is a pleasure to serve under your chairmanship, Mr Paisley. I am pleased to see so that many right hon. and hon. Members want to speak, so I will be as brief as possible.

The Government’s decision to go ahead with Huawei in the 5G network in the UK—it is clear from the evidence—has angered our allies and perplexed many of us who see this as an avoidable risk. In the rush—I believe it is a rush—to go ahead with the 5G system for the UK using Huawei’s products extensively, the UK Government have brushed aside the concerns of all our most important allies and the people we generally rely on. There is an overwhelming body of evidence indicating that Huawei is an untrusted vendor, which should not be given any further opportunity of access to our most vital communication networks.

The decision of the UK Government leaves us, at the moment, utterly friendless among our allies. After all, Huawei is effectively a state-owned corporation in the People’s Republic of China under the Communist party. Huawei Technologies is 99%-owned by Huawei Investment & Holding, which in turn is completely owned by Huawei Investment & Holding’s trade union committee. According to Chinese law, trade union committees are classified as public or mass organisations, which do not have shareholders, as they are recognised under Chinese law as legal persons or entities in their own right. An example of a public organisation would be the Communist Youth League.

[Bob Seely (Isle of Wight) (Con)]

The relationship between Huawei and the state is the same as the Communist Youth League to the state. Therefore, is it not baffling that the Government continue to argue that Huawei is a private company, given that, by the western definition, that cannot be said in any meaningful sense?

[Sir Iain Duncan Smith]

I agree. That is exactly the point I was making.

[Damian Green (Ashford) (Con)]

I was on a radio programme a couple of weeks ago with a director of Huawei in this country, who happens to be a former permanent secretary. I was surprised to hear him describe Huawei as being rather like John Lewis, in that it was owned by its employees, and that we had all got this wrong. Does my right hon. Friend agree that that is an absurd characterisation of Huawei?

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[Sir Iain Duncan Smith]

It is either absurd or I will have to review my purchase from John Lewis. My socks might even be bugged! My right hon. Friend is exactly right. I want to make this point, which often goes missing in this debate. Huawei is also seen as a national security threat. It continues to deal extensively with Iran without full public knowledge of how; it built a mobile network for North Korea; and it is providing security surveillance and censoring systems to authoritarian regimes, not least the Chinese Government.

It has long been documented that Huawei has a long and intimate history with the Chinese security services, and there are issues around the security systems that have been provided for them, which are now being used, I think, to supress the Uyghur people. I have real concerns about that.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

I want to bring to the right hon. Gentleman’s attention a recently published report from the Australian Strategic Policy Institute, “Uyghurs for sale”, which reports a horrific programme of exporting Uyghurs from Xinjiang to other parts of China. According to the report, Huawei is one of the companies that has benefited as a consequence.

[Sir Iain Duncan Smith]

That is shocking. If true, it is an absolute indictment. The British Government and other western Governments must speak up more about this and say that what is going on there is simply intolerable. If that were any other Government, it would be shocking. It is time that we call it what it is.

If all that is not enough to make one concerned—it should be—I hope that the UK Government, my Government, have noticed the following:

“A superseding indictment was returned yesterday in federal court in Brooklyn, New York, charging Huawei Technologies Co. Ltd. (Huawei), the world’s largest telecommunications equipment manufacturer, and two U.S. subsidiaries with conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act”.

That is a very serious charge, which was made a matter of weeks ago, yet the UK Government announced that although they recognise Huawei as an untrusted provider, we would not stop network providers using Huawei equipment in the new 5G system. Instead of banning them, as our allies have done, we would place limits on the locations and the extent to which Huawei products may be deployed in our 5G network, to reduce Huawei’s involvement over time to the figure of 35%.

[Mr Owen Paterson (North Shropshire) (Con)]

Does my right hon. Friend agree that by conceding that there is a problem and that it must be limited to 35%, the Government are admitting that the only safe option is to go to 0%? We have infuriated the Americans and our other allies in the Five Eyes. We know the Foreign Secretary had a bad time in Australia. Should we not have a concerted programme now with the Five Eyes allies to get to 0% over a short period of time?

[Sir Iain Duncan Smith]

I completely agree. I think the figure of 35% has been plucked from thin air. I will come on to the reasons why it does not work. Imagine that in 1939 we had been developing our radar systems and decided to have one of the Nazi companies in Germany directly involved. Oh, but we reduced their involvement to 35%, so they only controlled 35%. I wonder how ridiculous that would have seemed.

[Richard Drax (South Dorset) (Con)]

My right hon. Friend is making an excellent speech. I am not an expert in this field, but as the technology catches up, the Government intend to reinject our technology into 5G. I assume that once the Chinese are in there, we will never get them out.

[Sir Iain Duncan Smith]

That is the point. Each time, we are told that they will reduce, but, in fact, we get more and more addicted to them and are unable to change.

When the Government announced the figure of 35%, they made the point that the plan to exclude Huawei products from the core of the 5G infrastructure meant that we would solve the problem by restricting them only to the edge, as it was described. This position critically rests on the assumption that the core cannot be compromised from the edge. Most cyber experts whom I have spoken to know that this is an unsafe assumption, because they know that the whole 5G network can be attacked starting from the compromised edge, given the nature of change to the technological capability of the edge.

The edge components can be compromised. Indeed, there is some evidence that such attacks have already taken place on a limited scale elsewhere. For example, a hostile adversary might disable our 5G network by simply shutting down our antennas and/or routers at the edge by remotely activating the malware already buried inside many of those processors. Those embedded in the edge will have kill switches, which are currently nigh on impossible to detect and, therefore, to mitigate.

[Mr Mark Francois (Rayleigh and Wickford) (Con)]

My right hon. Friend is making an excellent speech. One facet of living in a free country is that we are free to make our own mistakes. This is the first big mistake that we have made. As a former Armed Forces Minister, I want to reinforce everything he has said. Given what I learned when I was in office, the idea that we can keep them securely on the edge is complete and utter nonsense.

[Sir Iain Duncan Smith]

I agree with my right hon. Friend and he will see that in the course of my remarks I will point out that we—alone, it appears—are taking an enormous gamble.

The second reason the Government prayed in aid of their decision on 5G was the fact that it offered three main benefits: faster data transmission rates, shorter delays and increased network capacity. While faster data transmission rates can improve user experience—there is no doubt about that—for most people, 5G will not significantly impact their experience. Tasks such as viewing a movie will not be perceptibly different from 4G. In any case, the data speeds offered by 5G—100 megabits per second to 1000 megabits per second—are in the range offered by more conventional superfast fibre broadband. In many cases, the desired performance can and should be achieved by other means. Completing the roll-out of superfast fibre broadband, which my Government have constantly promised to complete to the level it should be at, is the No. 1 priority. Further, that will affect the ability of 5G to operate.

[Julian Knight (Solihull) (Con)]

This comes down to a rather taxing conundrum. On the one hand, we have the intense concern of our Five Eyes partners about potentially allowing China into our security and societal networks; on the other hand, there is the economic opportunity cost of excluding Huawei from 5G. In the final analysis, does my right hon. Friend agree that security and democracy trump economics in all circumstances?

[Sir Iain Duncan Smith]

I am really grateful to my hon. Friend for that intervention. He is absolutely right; at the end of it all, our point is that defence of the realm comes first.

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

The right hon. Gentleman is making a really first-class speech. Of course, the argument about 5G or 4G is rather esoteric in parts of my constituency, because far too many of my constituents have zero G; I will just put that on the record. However, when we buy the box of tricks from the Chinese, if I can call it that, is there not also an issue, in that we are losing something here? That is because in this country we must maintain our skills in all of this stuff, and I believe that in going down this route we are going down a very dangerous road indeed in that regard.

[Sir Iain Duncan Smith]

The hon. Gentleman is absolutely right and I will come back to that point in a short while.

Although the Government claim that 5G will increase network capacity, there are concerns about the proliferation of the connected internet of things—the IOT devices—and a dramatic increase in self-driving cars with next-generation telematics. That is the key point.

There may be response-time critical benefits—in fact, there certainly are—in future with 5G, such as how self-driving cars share safety-critical information with one another. However, these applications overwhelmingly lie in the future and importantly will rely on a wider set of technological changes and significant changes in social attitudes; we must bear that in mind. This pressure that we can do things tomorrow, or within a few years, will somehow be another one of those gains that are used to leverage the idea that we have to make this development.

[Damian Collins (Folkestone and Hythe) (Con)]

My right hon. Friend makes the very important point that if 5G is the technology of the future, it will drive many things that people use on a daily basis. Does he agree that we should not accept critical infrastructure for this country to be built by companies that we have no trust in and about which there are serious security concerns, and that if we do not have the capacity to build that 5G system now, we should build coalitions of companies that can work together and be credible alternative providers of this important technology?

[Sir Iain Duncan Smith]

My hon. Friend is absolutely right and prompts the question: who has been asleep on their watch? That goes right back to the time when the Labour party was in government and was not even told by civil servants that they had made the decision to approve the involvement of 5G. Saying that is not to blame Ministers; it was the fault originally of civil servants.

Even if the Government disagree about the urgent need for such developments or disagree with my argument about this issue, surely, as my hon. Friend the Member for Folkestone and Hythe (Damian Collins) said, security is a greater priority. Government policy must consider the wisdom of proceeding to deploy vast numbers of IOT sensors in our environment, offices and homes, unless and until current legitimate security concerns about this issue have been laid to rest.

[John Spellar (Warley) (Lab)]

I thank the right hon. Gentleman for securing this extremely important debate. First, may I say that it is quite clear in this Chamber that there is bipartisan support for his position, as indeed there is in the United States among Republicans and Democrats on this issue, and as indeed there is in Australia with the Australian Liberal Government and the Australian Labour party on this issue? Therefore, one must ask: why are the Government pursuing this course? I ask that because the right hon. Gentleman is slightly in danger of accepting the argument that somehow Huawei is light years ahead of other companies in this field. It is probably a few months ahead, given the nature of this industry, which is always changing rapidly, and companies such as Ericsson, Nokia and Samsung are clearly developing, too. What those companies really need are orders, which are what Huawei has had from the Chinese Government, to pull through their development.

[Sir Iain Duncan Smith]

I am grateful, as ever, to the right hon. Gentleman, who is in danger of making my speech before I do, because I am coming on to those points. He will find that we not do not just have cross-party support; we are absolutely linked in our concern about Huawei.

I will come back to this point later, but I am afraid that a lot of this issue is about the way in which the establishment at the moment in the UK has somehow found itself locked into this Huawei process, and we need to break it free; it is like getting somebody free of an addiction to heroin. We need to put it into rehabilitation, which is the point of my speech at the moment.

[Graham Stringer (Blackley and Broughton) (Lab)]

The right hon. Gentleman is making the case that security is paramount. Does he agree that there is also a commercial argument, in that the Government are going to reward Huawei, which has bought its way into the system? Its first tenders in the 3G and 4G networks were at a quarter of the costs of its commercial competitors in Europe and North America. We should not reward people who are basically trying to bankrupt our industry.

[Sir Iain Duncan Smith]

The hon. Gentleman is absolutely right. This relates to my earlier comment about the linkage with the Government. I will come back to Huawei’s ability to draw on support finance—which we might call Government support.

I am aware that you want me to make progress, Mr Paisely, so I shall. I will also ask others to restrain themselves slightly, although I will not refuse interventions. That will not win me points from you, Mr Paisley, but I will not defy my colleagues.

Perhaps most bizarrely, I think that the rush by the Government is being driven by the fear that we will be left behind by others. It is worth tackling that point. I find it difficult to comprehend their position, given that a growing number of leading western nations, many of them our competitors in many fields, intend not to use Huawei—in fact, they will depart completely from Huawei, even if that means a delay—or any other untrusted vendors. Surely, therefore, it is inevitable that the worldwide roll-out of 5G must slow down. Given that so many nations are saying no to Huawei, this should be an opportunity for us to prioritise national security over the breakneck speed with which the deployment of 5G is being pressed on us.

[Tom Tugendhat (Tonbridge and Malling) (Con)]

I, too, praise my right hon. Friend for making a very strong speech. Does he agree that the two successful roll-outs of 5G so far have been carried out in South Korea and Japan—by Samsung and Fujitsu respectively—and neither of them seems to have included Huawei?

[Sir Iain Duncan Smith]

Yes, I agree. My hon. Friend makes a very good point. In fact, I have read a note from Samsung declaring that it is completely feasible to do this work without any involvement from Huawei. Indeed, Samsung made very clear its belief that Huawei is a direct threat to our national security because its system is not a trusted one.

Far from Huawei having some insurmountable technological lead, it seems, when one starts to investigate, that the quality of its work is no better than anybody else’s, and in some cases somewhat worse. I recall even Dr Ian Levy, the technical director of GCHQ’s National Cyber Security Centre, saying about a year ago that Huawei’s security was “very, very shoddy”. He also said that

“it’s engineering like it’s back in the year 2000”.

We need to take stock of this nonsense propaganda that Huawei is light years ahead as an organisation. Yes, it has a lot of people in research and development, but the reality is that its development has been about money.

The Government say that telecommunications companies are all reliant on Huawei. It was said earlier in the debate that telcos are absolutely reliant on Huawei, so delay would leave them significantly out of pocket. According to that line of argument, however, I would argue that reducing Huawei’s involvement to even 35% would leave telcos out of pocket, so we are already halfway there, as it were. It seems daft to try to make that argument.

Of course, the reliance on Huawei comes as a result of it having constantly bid well below other market competitors for UK and other business. After all, there is a long history of the China Development Bank providing low-cost financing for Huawei customers, and that approach is updated every few years. A recent report estimates that, when one takes in tax breaks, grants and low-cost land acquisitions, the subsidy comes to more than $75 billion. No western company in this sector will be able to compete on those grounds.

Despite all that, it is not common knowledge that at least one very significant UK service provider has contacted me to say that it has already made clear that it will not use Huawei in its 5G network. O2 suggests that the idea that these systems cannot be created without Huawei—my hon. Friend the Member for Tonbridge and Malling (Tom Tugendhat) mentioned this earlier—is complete and utter nonsense.

The NCSC’s guidance does not even mention services. I understand that Huawei is now taking over the managed services for another operator, Three, which opens up yet another huge area to gather information from. If someone has a map of a radio network, they will also have a map of everything connected to that radio network. They will know what each piece is, what it does and how to attack it.

Yet our dependence on Huawei goes even deeper—much deeper than many people realise. I have just noticed that Huawei is present in the emergency services network, which is often referred to as the blue lamp or blue light service. The service is part of our critical national infrastructure, but the issue did not come out in the statements. I am astonished that that would be allowed. We can imagine how dangerous any form of disruption would be to that service. It beggars belief. Then I discovered that MI5 uses a systems provider that is heavily dependent on Huawei equipment. These decisions are barking mad.

[John Spellar]

The right hon. Gentleman mentions Three. My hon. Friend the Member for Leeds North West (Alex Sobel), who is much more technically proficient, has looked that up for me. Three is owned by a company in Hong Kong.

[Sir Iain Duncan Smith]

The point I am making is that the systems and everything else that is being used are making things very vulnerable. The right hon. Gentleman makes my point exactly.

I am worried about the Government mobile system, which I understand the Government are working on. As usual for the civil service, it has some ghastly acronym. It is called gomo for short, which rather describes the process that we have been going through so far with Huawei. The Government have decreed that it will be one supplier only. It stands to reason that unless the Government block untrusted providers from the system, we will likely be handing over control of yet another vital and sensitive system to the organisation under discussion. That is a big question for the Government. Will they ensure that when that contract is let, the supplier will not have any input from untrusted providers such as Huawei? The Minister needs to answer that question.

[Mr Francois]

And can John Lewis bid for it?

[Sir Iain Duncan Smith]

I do not think John Lewis is in the market, but we can check that. I have not been there for any telecommunications.

I say to my colleagues and to you, Mr Paisley, that the situation is an utter mess at the moment.

[Mr David Davis (Haltemprice and Howden) (Con)]

I have been listening carefully to my right hon. Friend’s brilliant speech. As far as I can see, so far he has knocked down the Government’s arguments on technical grounds, diplomatic grounds, security grounds, practical grounds, commercial grounds and public safety grounds. After listening to his speech, there are no grounds on which to accept Huawei involvement in our national infrastructure. Can it be, therefore, that the Government’s only argument for accepting Huawei’s involvement is fear of China’s economic and geostrategic power? Giving in to that may be expedient, but does my right hon. Friend agree that it would be geostrategically wrong to kowtow to the Chinese Government?

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[Sir Iain Duncan Smith]

My right hon. Friend is right. He also comes to a point that I will make shortly. My concern is that there are other logical reasons in play, which I want to talk about in a second.

[Richard Drax]

Will my right hon. Friend give way?

[Sir Iain Duncan Smith]

I will give way one last time. I am aware of Mr Paisley’s guidance.

[Richard Drax]

I am so grateful. This is my second intervention, and then I will sit down and shut up. On the list that my right hon. Friend just gave, one thing he did not mention was trade. As the UK leaves the EU, we desperately seek our friends and allies to make a good trade deal. As I understand it, the US is now thinking not to sign up to a trade deal if 5G is linked to any part of it.

[Sir Iain Duncan Smith]

There is no question that the US Administration are very exercised by the UK’s decision to go ahead with 5G and Huawei. In fact, I cannot think of any other time when we have been so separated from most of our allies that we respect. The thing I cannot get is that even Vietnam, for God’s sake—a communist country next door to China—will not have Huawei in their systems.

[Tom Tugendhat]

They knows their neighbours.

[Sir Iain Duncan Smith]

Indeed. We are all neighbours in the global environment, as the dreadful coronavirus shows us.

The problem is compounded—this is not really spoken of in these debates, and the Government never make any mention of this—is a deeper and further problem. It exposes the degree to which western Governments, including our Government, to a degree—I am talking about successive Governments; this is not a shot at my Government, as the issue goes back further than that—have taken their eye off the ball. Much of the available equipment, including electronic sub-assemblies, is of unknown security provenance. At present, beyond existing contracted functions, we have little to no idea what else lies in our installed systems. UK Governments and others—I particularly want to focus on my Government—have done little to tackle the problem. Understanding what is inside the chips and processors is critical. Any malware needs to be detected. Surely, after all these years, we could have worked to ensure as much as possible that products deployed into secure or critical national infrastructure are auditable, so that we understand what is in them. What better way to do that than by collaboration with our Five Eyes allies, to ensure that we drive security much deeper? Nothing has happened, however.

We are in a mess, and the only way to get out of it, as my right hon. Friend the Member for North Shropshire (Mr Paterson) said, is to ensure that Huawei’s involvement is reduced from the Government’s present position of 35% down to 0%. I recognise that may take a little time, but that should be the purpose of the Government over the next two years.

Successive British Governments—this is the point that my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) made—have tried to get close to China in the hope that we can take advantage of their markets. I recognise that that is not unreasonable, but in so doing, we seem to be playing a dangerous game. After all, this totalitarian regime is not an ally of ours, and we get confused about that at times, even if the Foreign Office is reluctant to admit that China poses a threat to us, for fear of upsetting the Chinese Government. That threat is not just in its cyber-attacks on our systems, but also in the way in which it does not obey the international rules-based order in trade. That point has been made today. By the way, no other country does a level of business proportionate to its population as much as Australia does with China. Australia is not frightened of saying no to the procedure, and I do not see anybody trying to beat it up on trade. Sometimes I wonder if we do not project the sense of power or force that we should.

As the UK leaves the EU, we should avoid kowtowing, as my right hon. Friend so rightly said—that wonderful Chinese act of placing one’s forehead on the ground in front of one’s respected superior—to China or anyone else. The British Government should commit to reducing and eradicating our dependence on Huawei, in line with our allies. That is really important. After all, defence of the realm is surely our first priority, and that goes for cyber-space as well. If defence of the realm is our first priority, what the Government are proposing today is not defence of the realm, but semi-defence of the realm, and that simply will not do.

[Ian Paisley (in the Chair)]

We have had a 26 minute-speech or thereabouts and 15 interventions, some very substantial, which have maybe taken the ardour out of some people already. I have 11 speakers to get in, including the Front-Bench spokespersons for the Government and the Opposition parties. I will therefore be time-limiting Members to four minutes, to allow all the speakers on my official list to speak. However, if they take interventions, that could be reduced or may knock a speaker out.

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[Matt Warman]

As I say, we want to get to a position where we do not have to use a high-risk vendor in our telecoms network.

[Sir Iain Duncan Smith]

This is a very important point. I want to know, and I think the rest of the House would like to know, whether it is now Government policy to drive to 0% involvement by Huawei and other non-secure vendors. Is that now the policy—not just to 35%?

[Matt Warman]

Our aim is not to be reliant on high-risk vendors at all. I appreciate that my right hon. Friend would like me to set out a timetable for that, but I cannot do that today.

There are major market problems we need to address and they are common to all western nations. We have to remain hard-headed and evidence-based. We want to ensure that, as new technologies develop, we have a vibrant and diverse ecosystem of suppliers that we can rely on. The decisions we have made in this area are the right ones because they are based on hard evidence.