MPs have warned that "important work" being undertaken by the Foreign Office is at risk from Treasury spending restrictions.
The Commons foreign affairs committee said the recent Comprehensive Spending Review represented an annual real-terms reduction of 0.2 per cent in the department's budget, while other departments received an average 2.1 per cent increase.
"The Comprehensive Spending Review settlement for the FCO, one of the tightest in Whitehall, risks jeopardising the FCO's important work," it warned in a report on Monday.
MPs said the programme of upgrading security at British embassies must not be disrupted, and said they were "very concerned" that almost half of funds allocated to preventing wars had been diverted to Iraq and Afghanistan.
"The FCO should not have to direct funds away from long-term conflict prevention into crisis management," the report said.
It urged the government to reconsider plans to cut the network of defence attaches, saying it was "critically important" to a number of other departments and agencies - including those involved in licensing arms exports - that they remain in place.
And the committee urged foreign secretary David Miliband to lift the ban, imposed by his predecessor Margaret Beckett, on the traditional valedictory telegram sent by ambassadors to the foreign secretary at the end of a posting.
The practice was said to have been stopped after the contents of one such message were leaked.
