An unseemly row has broken out between Ed Miliband and David Cameron over the crisis in Gaza after the Labour leader claimed the prime minister's "silence" on events was "inexplicable".

Downing Street responded with a statement accusing Miliband of "playing politics" as the death toll of Palestinians exceeded 1,650 and Israel confirmed that it had lost 63 soldiers and three civilians, its highest death toll since the 2006 Lebanon war.

In a further effort to deflect Labour's attacks, the foreign secretary Philip Hammond said on Sunday that the effect of the Israeli bombing on Gaza's civilian population was "intolerable".

Hammond told The Sunday Telegraph: "The British public has a strong sense that the situation in Gaza is simply intolerable and must be addressed - and we agree with them.

"There must be a humanitarian ceasefire that is without conditions. We have to get the killing to stop."

The row came as the Israeli prime minister Binyamin Netanyahu indicated on Saturday night that Israel's nearly month-long military operation was coming to an end with the destruction of Hamas tunnels into Israel almost complete. Israel also said that Hadar Goldin, the soldier believed captured by Hamas, had been killed in action.

Earlier on Saturday, Nick Clegg issued a plea for the Israeli government to halt its military operations and talk to Hamas, warning that the assault on Gaza appeared to be a "disproportionate" response to rocket attacks from the territory.

In the Commons last month, Cameron did voice "grave concern" about the death toll in Gaza but had stressed that Israel had a right to defend itself and accused Hamas of triggering the crisis.

But in a statement on Saturday, which broke with the norm of presenting a united front on matters of foreign policy, Miliband said Cameron had so far failed to send out "clear and unequivocal message" to both sides in the conflict.

Miliband said: "With the breakdown of Friday's ceasefire and the prospects of peace seemingly distant, it is now more important than ever that the international community acts to get the two sides to agree to a renewed ceasefire, and thereafter to reestablish meaningful negotiations to achieve a two-state solution.

"David Cameron should be playing a leading role in these efforts to secure peace. He is right to say that Hamas is an appalling, terrorist organisation. Its wholly unjustified rocket attacks on Israeli citizens, as well as the building of tunnels for terrorist purposes, show the organisation's murderous intent and practice towards Israel and its citizens.

"But the prime minister is wrong not to have opposed Israel's incursion into Gaza. And his silence on the killing of hundreds of innocent Palestinian civilians caused by Israel's military action will be inexplicable to people across Britain and internationally."

A Downing Street spokesman said in response: "The PM has been clear that both sides in the Gaza conflict need to observe a ceasefire.

"We are shocked that Ed Miliband would seek to misrepresent that position and play politics with such a serious issue."

In his statement, Miliband said that while he was a supporter of Israel and believed in its right to self-defence its military actions in the last fortnight had been "wrong and unjustifiable".

He said: "The escalation of violence engulfing Gaza has led, and is leading, to suffering and destruction on an appalling scale, and is losing Israel friends in the international community day by day.

"Israel's present military action will increase the future threats to its security rather than countering them. Israelis rightly and justifiably want that security, yet their government's present actions instead risk simply a growing a new generation bent on revenge.

"Sustainable security for Israel cannot be achieved simply by permanent blockade, aeriel bombardment and periodic ground incursion. Instead, it requires acknowledging the legitimate claims of Palestinians to statehood, and sustained efforts to secure a viable Palestine alongside a secure Israel.

"As for the British government, its job now is to develop a collective response not a differentiated one and to speak with one voice. We need the clear and unequivocal message that has not so far been provided to be sent from Britain to both sides in this conflict. David Cameron and the Cabinet must put Britain in a leading role in pressuring both sides now to end the violence."

Britain is making a further £3m available to allow a rapid response by aid workers in Gaza to what international development secretary, Justine Greening, described as "nothing short of a humanitarian catastrophe".

The activation of Britain's Rapid Response Facility – which brings total UK aid in the current crisis to £13m – will allow pre-approved non-governmental organisations (NGOs) to access funds within a few days.

Priority is being given to projects to provide clean water and sanitation following extreme water shortages, as well as emergency healthcare, clearance of unexploded ordnance and counselling and care for civilians, particularly women and children.

The UK's Department for International Development said that since the Israeli offensive began on 8 July, 136 schools – some serving as shelters – 24 hospitals and clinics and 25 ambulances have been damaged or destroyed, while eight UN aid workers and at least two Palestinian Red Crescent volunteers have now been reported as killed.

Some 40% of the sixth-most densely populated area on Earth is now a war zone, with a quarter of the Gazan population displaced.