Theresa May personally rejected “horrific” proposals for cuts to fill the defence budget black hole, its has been disclosed, but has been warned of a Tory rebellion unless she fixes the Armed Forces funding crisis.

Cost-cutting options proposed as the Ministry of Defence tries to find £20bn of savings amid a wider Whitehall security review would have seen 11,000 axed from the Army and 2,000 cut from the Royal Marines.

The leaked proposals described as “horrific” and “ugly, ugly and ugly” were blocked before Christmas by the new Defence Secretary, Gavin Williamson, and Mrs May, who both decided they were politically unacceptable.

But defence sources and MPs warned the three suggested packages of cuts laid bare the scale of possible reductions still hanging over the forces unless more money is found.

The three proposals included cutting up to seven Royal Navy frigates and as many as 100 helicopters, and merging parts of 3 Commando Brigade and 16 Air Assault Brigade.