The Tories claim the Chancellor is plotting the creation of a Homeland Security Department after signalling the need for a national overhaul of security.
Alongside the confirmation that an extra £43 million is being set aside over the next 12 months to bolster the fight against al-Qa'ida, Treasury documents said the Government would "review counter-terrorism and security strategies" and "consider the case for a single security budget". Home Office sources insisted last night that the review does not indicate a loss of responsibility by the department for counter-terrorism if Mr Brown becomes Prime Minister. But David Davis, the shadow Home Secretary, said: "The Government is clearly trailing the idea of a single department of homeland security. We welcome this as a practical way of taking on the terrorist threat."
The £43 million will pay for new recruits to MI5, MI6 and GCHQ as the security agencies strengthen their efforts, as well as in high-technology surveillance equipment.
Mr Brown said a charitable fund to support Britons injured or affected by terrorist attacks overseas, as well as at home, would be established with an "initial endowment" of £1 million. He said money would also be allocated towards a memorial to the 52 people who died in the July 7 bombings.
He told MPs: "This is the first budget since the attacks and tragedies of July 7, a day when the nation stood as one against terrorism. We will never forget those who lost their lives and those who were injured."
Nearly 10,000 more community support officers (CSOs) will be recruited over the next year in an effort to meet Labour's election manifesto commitments on policing early. Mr Brown announced that £91 million was being allocated to boost the number of CSOs from the current 6,324 to 16,000 by April 2007.
Labour promised last year to boost the number of civilian patrol officers, condemned by critics as "plastic policemen", to 24,000 by the next election. The Chancellor's announcement means it will be a year ahead of its planned schedule.
He said: "The Home Secretary and I want every community to have a community policing team as soon as possible."
The cash will also pay for a new system to allow local police to publish details of police performance and crime rates at regular intervals.
Case Study, Fireman: '7/7 memorial is laudable - I'd like to see it extended'
By Deborah Linton
Russell James, 48, is head of people development at Greater Manchester Fire and Rescue Service.
Lives With his wife, Terri, 45, head of science at a secondary school in Oldham. They have two sons, Luke, 17, and Ethan, 14.
Income Their joint annual earnings are £108,000.
Outgoings Both sons attend Manchester Grammar School; their fees total £13,754 a year. Russel contributes 11.5 per cent of his salary - £623 a month - into the National Fireman's Pension Scheme, which allows him to retire after 30 years' service on a two-thirds salary. Monthly bills include council tax (£181), mortgage (£1,600) and utilities (£260). He drives 14,000 miles a year in his BMW 320, but 60 per cent of that is for work. He doesn't smoke, and drinks two-and-a-half bottles of wine a week.
Politics Voted Labour in election.
Hopes for the Budget Investment priorities are education and health. He is irritated to be paying for both private and state education and healthcare (Luke has had five private knee operations). But long-term financial stability is more important than budgetary gimmicks to win over the public.
Effect of Budget The family would be £289 a year better off, largely because of gains from income tax changes, worth an extra £450, but they lose out by £125 on alterations to National Insurance.
Reaction "The 7 July memorial is a laudable fund but I'd like to see it extended beyond just new terrorism dimensions, to natural disasters for example. What's the likelihood of it ever being used? How far will £1m go? Any money that the Government invests into our children can only be a good thing. But I want to know the full strategy that sits behind it. Is it administrators or teachers; books or nice, shiny classrooms?"