To put that in context, most British institutions saw reduced budgets, ranging from 10% for local government to 6% for Whitehall's business department. Even law enforcement had its funding crunched, with the Home Office's budget cut by 6%.
[ Information Commissioner's Office gives Google 35 days to purge personal data collected via Street View. Read Britain Orders Google To Delete Street View Data. ]
The extra money is intended for the security and intelligence agencies to achieve "key national security priorities, maintain core counter terrorist capabilities, and protect U.K. citizens and interests against terrorism threats."
Part of the funding will come in the form of extended support for cybersecurity, said to be a "the new frontier of defense -- and a priority for this government." Specifically, £210 million ($323 million) in the cross-government National Cyber Security Program (NCSP) will be invested in a broad range of projects across government to deliver the U.K.'s cyber security objectives, details of which have been promised later in the year.
Projects will be set up to protect U.K. interests in cyber space, making it harder for hostile states and criminals to target the country, and to raise business and public awareness of online threats, with a focus on how they can protect themselves and invest in the skills and standards needed to support a vibrant and internationally competitive U.K. cybersecurity sector.
The £210 million adds to the previously committed £650 million ($1 billion) funding for the NCSP. According to government sources, this money is generating significant benefit to the U.K. by increasing the capability to tackle cyber threats, turning cybersecurity into an economic opportunity and establishing the U.K. as a leader in this field.
Osborne has also called for an ongoing efficiencies package to enable Britain's intelligence and counter-intelligence agencies to operate more effectively and to encourage further collaboration between GCHQ, MI5 and MI6 as part of this process.
For the Chancellor, Britain's spies' work remains critical. He stated in his speech to Parliament Wednesday, "Silently, and often heroically, these fellow citizens protect us and our way of life."