British spies are developing an offensive cyber capability to attack terrorists, hackers and rogue states, finance minister George Osborne said on Tuesday (17 November) after warning that Islamic State (Isis) militants wanted to launch deadly cyber-attacks of their own. Osborne said IS fighters were trying to develop the ability to attack Britain's infrastructure such as hospitals and air traffic control systems with potentially lethal consequences.

In response to this threat and others, Britain was creating its own offensive cyber capability so spies could launch counter attacks, he said.

"ISIL's (Islamic State of Iraq and the Levant) murderous brutality has a strong digital element. At a time when so many others are using the internet to enhance freedom and give expression to liberal values and creativity, they are using it for evil. Let's be clear – ISIL are already using the internet for hideous propaganda purposes, for radicalisation, for operational planning, too," Osborne said in a speech at Britain's Government Communications Headquarters (GCHQ).

He said Friday's (13 November) attacks in Paris, which killed at least 129 people and were claimed by IS, had underscored the need to improve Britain's protection against electronic attack. IS was already using the internet for propaganda, to radicalise people and for planning purposes, said Osborne.

"They have not so far been able to use it to kill people by attacking our infrastructure through cyber-attack. They do not yet have that capability, but we know they want it and we know they're doing their best to build it. So when we talk about tackling ISIL, that means tackling their cyber threat as well as the threat of their guns and their bombs and their knives," he said.

Osborne said public spending on cyber-security would be almost doubled to a total of £1.9bn ($2.9bn) over the period to 2020, even as he prepares to announce fresh overall spending cuts next week in a bid to return Britain to a budget surplus by the end of the decade.

"And all this is reflected in the cyber breaches that we see being reported with increasing frequency and increasing severity. Last summer GCHQ dealt with 100 cyber national security instances per month. This summer the figure was 200 a month. Each of these attacks damages companies, their customers and their public's trust in our collective ability to keep their data and their privacy safe," he said.

Cameron said on Monday (16 November) that the size of Britain's intelligence agency staff would be increased by 15 percent. Osborne said the decision to ramp up cyber defence funding had been taken before Friday's bloodshed in Paris.