Hundreds of millions of pounds should be diverted from rural police forces to those that cover inner cities, an official report has recommended.
Sir Ronnie Flanagan, the Home Office's adviser on policing, said that some forces containing large cities need greater funding which may have to come at the expense of forces in the countryside.
He also said that civilians could carry out much of the work done by the 141,000 front line officers in England and Wales.
Police forces are paid for by grants from the Government and from council tax payers.
In a move that could fuel the row about Labour diverting public cash to its heartlands, Sir Ronnie said in his Review of Policing: "Some forces are not receiving the funding they need to meet the risks they face.
"If we are to get the best performance return for our investment over the lean times ahead, we must start to deal with these anomalies.''
West Midlands Police, which covers a relatively urban area, receives pounds 48 million -11 per cent less than it needs. Northumbria, which is more rural, gains an additional 12 per cent, or pounds 29 million, in grants.
Rural authorities that are likely to see their funding cut include Northumbria, Suffolk and Dorset.
The report added: "There is recognition among the leadership of the service that maintaining police numbers at their current level is not sustainable.''
His warning comes after the Association of Police Authorities said last year that numbers could fall by as many as 6,000 officers in the next three years because of a pounds 3 billion funding gap.
However, if levels of red tape were stripped back it could release up to seven million hours of police time every year, the equivalent of 3,500 officers, Sir Ronnie said.
As revealed by The Daily Telegraph, Sir Ronnie believes the "stop and account'' form, which officers have to complete every time they stop someone, should be scrapped.
The scheme could be expanded to incidents when police search members of the public and police could leave a "business card'' or receipt as a record instead.
Sir Ronnie recommended that serious crimes should be recorded in detail but less serious offences noted in a "much more concise way''.
David Ruffley , the Conservatives' police reform spokesman, said: "Labour see slashing red tape solely as a means to cut police officer numbers. But the Conservatives will cut red tape to put more officers on our streets.''
Jacqui Smith, the Home Secretary, said: "We are determined to cut unnecessary red tape and free up police officers to focus on protecting their communities.''
The Home Secretary said the "stop and account'' form will be scrapped in three pilot areas and probably nationally by the end of the year.
Instead police radios will be used to record any encounter and officers will give business cards to those stopped.
Stop and search forms will be streamlined and powers to tackle gang-related gun and knife crime will be extended.
Miss Smith said that officers would be allowed to stop and search suspects in designated areas.
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