The lack of clear public understanding about the role of the armed forces represents one of the greatest strategic threats facing the military, MPs have warned.

The Commons Defence Committee said the ending of military operations in Afghanistan combined with a reduced appetite for overseas interventions could lead the public questioning the purpose of the forces.

It expressed concern that defence would be increasingly seen as a matter of "discretionary spending" and warned that any further cuts would result in a "disproportionate decline" in the forces' fighting power.

It was essential, it said, that future decisions relating to Britain's ability to deploy forces around the world were based on proper strategic thinking and not simply the political "horse-trading" which accompanies the Government's comprehensive spending review (CSR) process.

The committee called on ministers to develop a proactive communications strategy to bridge the "disconnect" with the public and explain why military force was still needed in the current strategic environment.

"Explaining the case for defence to the public only becomes harder in the light of public scepticism about both the objectives of recent operations and how success in them might be defined," it said.

"There is a lack of understanding amongst the public of what HM Armed Forces should be for, and this represents one of the greatest strategic threats facing the armed forces.

"Public sympathy and support for the armed forces is to be welcomed, but it must not obscure or undermine a hard-headed understanding of what they are for."

The committee said the last Strategic Defence and Security Review in 2010 had been driven by the "overriding strategic objective of reducing the UK's budget deficit" and that any further cuts would have a severe impact on the UK's military standing.

"A failure to meet the Ministry of Defence's budgetary assumptions could lead to a disproportionate decline in the armed forces' fighting power, which would have a significant impact on the UK's strategic ambition," it said.

"There is a danger of defence becoming a matter of discretionary spending .... Discretionary decisions about the expeditionary capability that the UK retains must be based on proper strategic decision-making about the UK's place in the world and not simply flow from the 'horse-trading' that surrounds the CSR."

The committee also highlighted the need for the Government to think more strategically about how to cope with the threat of cyber attacks or terrorism carried out by enemies it may not even be able to identify.

"The absence of a clearly identifiable enemy has very significant implications for the concept of deterrence in security policy," it said.

"The fact that a number of the asymmetric security threats to the UK, such as from terrorism or cyber attack, may not be capable of being deterred in all circumstances requires the Government to think more strategically about the resilience of the country's critical infrastructure and recovery following a successful attack."

Defence Secretary Philip Hammond acknowledged that public understanding of the role of the armed forces was essential to maintaining support for defence spending.

"The Strategic Defence and Security Review (SDSR) was the first thorough assessment for 12 years of the risks to our national security and the capabilities needed to defend the nation," he said.

"Shaped by the National Security Strategy and the urgent need to reduce the £38 billion black hole in the defence budget, it ensured we have the right capabilities and personnel to face the challenges ahead.

"We welcome the committee's focus on a strategic approach, but it is unrealistic to think that defence can operate in a vacuum, without having regard to the fiscal challenges the country faces. A meaningful SDSR has to balance strategic and fiscal challenges to find a sustainable solution for defence."

Shadow defence secretary Vernon Coaker said: "This report from the Defence Select Committee supports Labour's view that the Government made a mistake in not adopting a strategic approach to the 2010 Defence and Security Review.

"Instead of looking at what was necessary to ensure the continuing safety and security of Britain and our place in the world, the review was driven solely by financial considerations.

"That is not the right way to plan for the future defence capability of the United Kingdom. It is a short-sighted, false economy that ends up costing more in the long-run.

"No-one is disputing the financial constraints within which the UK military must operate. But the Government can't cut its cloth before taking the measurements.

"Labour will ensure that the next defence review will be strategy-led and financially responsible."