The Chancellor Gordon Brown announced a new crackdown on terrorist financing today, targeting "dubious" charities used to transfer funds for terrorist groups.
In a wide-ranging speech to the Chatham House foreign affairs think tank, Mr Brown promised to make security a top priority in his forthcoming comprehensive spending review.
The Chancellor said that for the first time secret intelligence evidence would be used to freeze the assets of suspected terrorist financiers.
And he said that the Government should be prepared to re-open the issue of holding terrorist suspects for more than 28 days without charge if the evidence warrants it.
"Today we face terrorists who act without warning, who can take the lives of thousands in one act - and who are willing not only to take the lives of others, but their own as well," he said.
"So we cannot now risk waiting for someone to commit an act. Indeed it would be a failure of our duty to protect people to do so."
The Chancellor also offered support for Leader of the Commons Jack Straw - criticised in recent days by other ministers - saying the debate he had started about the wearing of the veil by Muslim women would continue.
"In the wider debate about diversity and integration, we should also emphasise what we in Britain need to have in common - the responsibilities we should accept as citizens, as well as the rights," he said.
"I believe all who live in this country should learn English, understand our history and culture, take citizenship tests and citizenship ceremonies."
He launched a strong attack on "anti-Americanism", saying that it should have no place in Europe.
"Indeed, we should explicitly state that American values and European values are as one in counter-posing to extremist ideology that glorifies terrorism the values of liberty, democracy and justice as essential to the dignity of all," he said.
At the same time, Mr Brown stressed that it was important to tackle the "roots of terrorism" - most urgently by getting the Middle East peace process back on track.
He said he would be making further visits to the region to offer asssistance in addressing the economic problems of poverty and unemployment.
"What we confront is not a conventional fight, and therefore cannot be won by conventional methods," he said.
"But as we tackle injustices that breed resentment, we must match our security strategy with an economic and political strategy too.
"And it is by showing we are not just fighting against terrorism, but fighting for peace and prosperity for all people across the world, of whatever religion, that we will extinguish the heat that ignites the extremists' fire."
On terrorist financing, Mr Brown said there would be a review of the entire charitable sector to "root out" those organisations which were being exploited by terrorists.
At the same time, he said, there would a new, more stringent, licensing system for bureaux de change, cheque cashers and money remitters which were also subject to abuse by terrorists.
And he said consultations were under way on new measures to deal with money laundering, adopting a "risk-based approach" to ensure legitimate businesses were not penalised.
On possible moves to extend the time terrorist suspects could be held without charge beyond the current 28 day limit - on which the Government has already suffered one defeat in the Commons - Mr Brown said they would have to be accompanied by new safeguards to ensure they were not abused.
"I believe that in any subsequent legislation, Parliament should reassure itself that this oversight is working and improve it if necessary, and to ensure even greater accountability there be a right of appeal to the High Court," he said.
"But it is in my view right also that, if we did go beyond 28 days, we give the independent reviewer of terrorism law the explicit power to look at and to report on any case which goes beyond 28 days without charges."