Delivering an unprecedented attack on the Government's security policy, the Royal United Services Institute report has accused ministers of a ''piecemeal and erratic response'' to urgent threats to the nation and of starving the armed forces of cash to the point of ''chronic disrepair''. The report urged ministers to abandon ''flabby and bogus strategic thinking'' and make the defence of the realm the ''first duty of Government'', the Daily Mail reported.
A new committee composed of Cabinet ministers, service personnel and other security experts should be created to solve the problem, it said.
It was released following a Britain's court ruling that unless there was clear evidence of ''terrorist intent'', merely possessing or sharing extremist material did not amount to a crime.
Laws making it a crime to possess extremist jihadi propaganda and literature were earlier designed to help police catch so-called ''clean-skins'' - would-be terrorists who were in the early stages of planning to carry out an attack.
The effect of the ruling is that the police would struggle to build a watertight case against suspects based on such early planning or research for an attack and would instead be forced to wait until the plans were far more advanced - increasing the risk of a successful attack.
The RUSI study urged for a radical shake-up of government saying, ''the world is living through a time of remission between the September 11 attacks six years ago and a yet-worse future atrocity which will deliver an even greater psychological blow.
It stated a serious decline in the armed forces has left Britain ''open to ambush'', with the military engulfed in an ''atmosphere of chronic disrepair''.
New threats emerging besides Islamist terrorism were ''ferocious'' Russian nationalism, climate change and competition for resources - while international bodies which Britain relies on such as the United Nations, NATO and the EU were ''weakening'', it said.
However, the Defence Ministry rejected RUSI's warnings of military decline, saying, ''The UK's Armed Forces have the ability to meet the broad range of tasks they may be required to undertake, often at short notice. They have a battle-winning capability that is second to none. The broad range of capability gives us insurance against the inherent uncertainty of the future.''