Sajid Javid has demanded a boost to police funding; Philip Hammond has said no

Philip Hammond has dismissed calls for more money for the police, leading to warnings in government that the chancellor risks undermining the fight against terrorism.

Well-placed sources said a budget showdown last week between Hammond and Sajid Javid, the home secretary, “did not go well”.

Javid has demanded several hundred million pounds in three parts: money for general policing, a new pot of cash to fund counter-terrorism and greater leeway for local authorities facing a crime crisis to raise a local tax called the “precept”.

Figures released last week show that crime is rising around the country.

Hammond has refused to budge, however, and is said to think the police would help their case for more money if they were more responsive to local residents