Smart city technology designed to streamline public services could prove an “attractive target” for hostile states seeking to disrupt Britain’s infrastructure or steal sensitive data, UK spies have warned.

The intervention by the National Cyber Security Centre, a branch of GCHQ, reflects growing fears in the intelligence community that local authorities may inadvertently enter risky contracts which could expose them to cyber attack or compromise individuals’ privacy. A deal that was aborted at the last minute involved Bournemouth council in Dorset, which was preparing a contract with the Chinese ecommerce company Alibaba to provide “smart place” services, the Financial Times has discovered.

Guidance to councils published on Friday highlights the risk that overseas smart city technology suppliers may come under pressure to “access and exfiltrate data” on behalf of security and intelligence services in their countries of origin. Safety suggestions include cyber security and data protection measures, as well as tips on understanding threats posed by suppliers.