Labour MP Sarah Champion said: “Very clear arguments have been made why the embassy would be a security and psychological threat to the UK. I’m not reassured they have been fully considered.”

Throughout the late 1990s and 2000s the site hosted major institutions, including Barclays, Deloitte, and BlackRock.

An assessment by UK intelligence agencies warned that the site’s proximity to cabling feeding the City’s financial hub was a national security risk.

Former Home Secretary Priti Patel said the claims were “extremely concerning” as she accused the Government of “showing total contempt for our national security”.

“Approving a spy hub in return for a cheap refurb would be simply ludicrous,” she said.

The offer was only on condition of the UK approving China’s plans at Royal Mint Court, near the Tower of London.

It came after the Chinese had been cutting off electricity, and turning off the heating at Britain’s own diplomatic post in Beijing.

Qiu and Shen used the professional social networking site to obtain “non-public and insider insights”, MI5 said, also targeting economists, think tank staff and civil servants due to their access to politicians.

In one approach from Shen to an official at the Dutch Ministry of Justice, the fake Chinese recruiter claimed to be offering a consultant role with a “global famous research center” and wanted to chat further about the opportunity.

Other connections to the pair include leading voices from UK think tanks as well as key policy makers among UK government departments on China, leading to serious concern among intelligence officials.

The committee found that the UK has “extremely large expenditure commitments” on defence, “without clear plans for how government will pay for them” in findings from its annual report.