The government has launched an Office of Cyber Security, designed to coordinate policy on online security.

The new agency, expected to be up and running in September, will be based alongside the Government Communications Headquarters in Cheltenham.

It will be charged with protecting the UK from terrorists and “hostile states” attempting attacks in cyberspace.

As well as working to make “critical systems” in the public and private sectors more resilient to attacks, the organisation is charged with interacting with other countries to improve international law on cyber security.

Gordon Brown said the agency reflected the importance of the electronic world to UK interests in the 21st century and pointed out that some terrorists groups were using the internet in a “wholly exploitative way”.

Security minister Lord West said the government had employed former illegal hackers to help in their work, but said they were more “naughty boys” than “ultra criminals”.