Ministers intend to push through emergency legislation to stop terrorists from being released from prison halfway through their sentence.
Justice Secretary Robert Buckland said the Government would table legislation within days that will mean terrorist prisoners will not be released before serving their full sentence, without a strict risk assessment by a new arm of the Parole Board.
It comes 24-hours after Sudesh Amman was shot dead by police around a minute after launching an attack on two bystanders in Streatham High Road, south London, on Sunday. A third person was injured by flying glass during the gunfire.
Investigations continue with officers also searching two addresses in south London and Bishop's Stortford, Hertfordshire.
“We cannot have the situation where an offender - a known risk to innocent members of the public - is released early by automatic process of law without any oversight by the Parole Board,” he said.
“We face an unprecedented situation of severe gravity and, as such, it demands that the Government responds immediately and that this legislation will therefore also apply to serving prisoners.
Mr Buckland added: "We face an unprecedented situation of severe gravity and, as such, it demands that the Government responds immediately and that this legislation will therefore also apply to serving prisoners."
He said offenders will not be considered for release until they have served two-thirds of their sentence and that no terrorists will be released before the end of their full custodial term unless the Parole Board agrees.
Counter terrorism expert Dr Afzal Ashraf told TalkRADIO's Julia Hartley-Brewer: "We know that terrorism and radicalisation are evolving. We need some form of an enquiry that gets us to the causes very quickly.
"What we need is people who have the skillsets, who understand the environment of terrorism. We start changing the procedure, the policy and legislation framework.
“By being slow and using systems which are not optimised, we are putting the public at risk."
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