THE Turnbull Government has moved to quash concerns about secret government files being kept in a data centre with links to a Chinese consortium.

Treasurer Scott Morrison spoke out this morning after the ABC reported that the Department of Defence would spend up to $200 million moving its files back to a government-controlled data hub due concerns about the private data centre’s ownership.

It comes amid growing concerns in Canberra about Chinese influence in Australian politics through foreign donations.

Defence will reportedly end its agreement with the Global Switch-owned data centre in Sydney by 2020 after Chinese consortium Elegant Jubilee bought a 49 per cent stake of its London-based parent company, Aldersgate Investments, in December.

Classified government information, including Defence and intelligence files, are reportedly kept at the centre.

It’s understood the decision to terminate the contract comes after Australia’s Foreign Investment Review Board conducted an investigation into the company’s ownership change.

Mr Morrison said the issue had been blown out of proportion.

“The issue here for Defence was having its data ... in a private data centre, which was a decision they made some time ago,” he told reporters in Canberra.

“That data centre in Australia is not in Chinese ownership. It’s ownership hasn’t changed.

“They’ve [Defence] made a decision to get their data out of that data centre and that’s an entirely appropriate decision.”

Mr Morrison clarified that the data centre in Australia was “carved out” of the global deal for Aldersgate Investments.

“When that company sought to have the Australian operations included in that deal, well, they did not proceed with that,” he said.

“They got a very clear message from the government about how the government would feel about that being incorporated into that global deal.”

He said: “The government acted at all times to ensure the integrity of our foreign investment program when it came to that data centre.”

Global Switch’s group director, Asia-Pacific, Damon Reid told the ABC that the company did not have access to customer data.

“Our customers lease space which they fit out with their own secure cages with their own servers,” Mr Reid said in the statement.

“Global Switch operates under the highest levels of security and our shareholders are restricted from physical access to the data centre.”

China’s Ambassador to Australia Cheng Jingye last week rejected recent allegations about Chinese influence in Australian politics, saying they were “made out of thin air”.

His comments come after a joint ABC-Fairfax Media investigation exposed concerns held by Australian intelligence agency ASIO about Australian political parties and Chinese donors.

“I’ve heard those allegations more than once since I was posted here — in Chinese, we call it the overnight cooked rice, which means repeating the same old stuff again and again,” Mr Cheng said.

“Maybe the producers of the program believe that those groundless allegations may turn out to be truth after being repeated thousands of times.

“Those who have fabricated those allegations really have an imagination which is wild and morbid.”