A former private school boy from Edinburgh is today being reported as the Tory parliamentary researcher arrested on suspicion of spying for China.

The man, who is in his late twenties, was employed by a senior Conservative MP.

He is reportedly the son of a GP and grew up in a wealthy suburb of the capital where he attended George Watson’s College before studying at a university in Scotland.

When he was arrested in March a handful of ministers were informed but details of the alleged security breach were not made public until this weekend, prompting outrage from MPs who were left in the dark.

In a statement released through his lawyers to PA this morning, the former parliamentary researcher insisted he is "completely innocent".

The man said he had spent his career highlighting the "challenge and threats presented by the Chinese Communist Party".

The arrest under the Official Secrets Act led to the Prime Minister confronting Chinese premier Li Qiang at the G20 summit in India on Sunday over "unacceptable" interference in democracy.

In the statement, the researcher - who has not been officially named by police - said: "I feel forced to respond to the media accusations that I am a 'Chinese spy'.

"It is wrong that I should be obliged to make any form of public comment on the misreporting that has taken place.

"However, given what has been reported, it is vital that it is known that I am completely innocent.

"I have spent my career to date trying to educate others about the challenge and threats presented by the Chinese Communist Party.

"To do what has been claimed against me in extravagant news reporting would be against everything I stand for."

Several MPs have been outspoken in their condemnation of China’s human rights record and have been sanctioned by Beijing.

They fear that they are targets for the Chinese security services. The MPs were so concerned by the arrest that they were preparing to use parliamentary privilege to name him as the suspect in the Commons this week.

Sir Iain Duncan Smith, the former Tory leader who has been sanctioned by China, told The Times: “It’s a remarkably dangerous situation. This is a guy who allegedly spies on behalf of the Chinese government in the place where decisions are made and sensitive information is transferred."

Another Tory MP who has been sanctioned by China told the paper: “I’m in a complete state of shock. We weren’t told about this, we haven’t been given any support."

A third sanctioned Tory MP said: “We didn’t know anything until we read it in the paper [The Sunday Times].”

China has labelled the arrest a”political farce” and “malicious slander”.

“The claim that China is suspected of ‘stealing British intelligence’ is completely fabricated and nothing but malicious slander,” the Chinese embassy in London said in a statement published late on Sunday.

“We firmly oppose it and urge relevant parties in the UK to stop their anti-China political manipulation and stop putting on such self-staged political farce.”

The case is likely to raise serious questions about security. The researcher was vetted as a parliamentary passholder but did not have a security clearance.

The Times reported that it understood the material exchanged was not necessarily classified or top secret.

However, a security source said that information did not need to be top secret to be highly sensitive and valuable to China: “It’s about networks and about influence. What do people in parliament think, which other people can be spoken to?”

The man became active on Westminster’s social scene and used a dating website, making several attempts last year to arrange a date with a political journalist.

Last year the alleged work of Christine Lee, an alleged agent for the Communist Party, prompted MI5 to release a rare interference alert even though she is not believed to have accessed top secret material. She denies any wrongdoing and is understood to be suing MI5.

Matt Jukes, the Met’s assistant commissioner in charge of counter-terrorism, said earlier this year that investigations linked to threats from foreign states have quadrupled in the last two years.

The National Security Act, which became law and replaced the Official Secrets Act this summer, contains new powers to make it easier to prosecute the passing of information to hostile states. It does not apply in this case.

The researcher from Edinburgh was arrested at the same time as a second man in his thirties. Both have been released on police bail until October.

Tory MP Caroline Noakes called for a review of the passes. She told Times Radio: “We need them to be looking at what passes have been issued ... and making sure that those who shouldn’t have them don’t.”

Responding to the reports that a parliamentary researcher has been arrested amid accusations that he was spying for China, Scottish Liberal Democrat leader Alex Cole-Hamilton MSP said: “I am deeply troubled by these reports which suggest worrying evidence of Chinese interference in the operation of our parliamentary democracy.

“Scottish Liberal Democrats have been warning about the reach of Chinese influence for some time now. We cannot afford to be complacent in the face of national security threats.

“To this end, I would like to see a commitment from both our governments to conduct an immediate strategic audit of the reach of China’s influence in Scotland.”