Government departments been ordered to prepare for cuts of up to 40% as Chancellor George Osborne fired the first shot in the latest Whitehall spending review.
Mr Osborne warned ministers in unprotected departments would be expected to deliver "more for less" in the Government's drive to save £20 billion over the next four years.
Treasury Chief Secretary Greg Hands is writing to departments to set out plans to achieve savings of 25% and 40% by 2019-20 - in a repeat of what happened at the start of the last parliament in 2010.
Cabinet Office Minister Matt Hancock acknowledged that cuts of 40% would mean radical changes for the departments involved but said that it was important to look at all the options.
"We have got to see where we can best make the savings across the whole of government," he told BBC Radio 4's The World at One programme.
"It is worth looking at what that looks like in each case. In each department you do want to look at what a radical change would mean."
As part of the efficiency drive, Mr Osborne has signalled that he wants departments to to draw up plans to sell off billions of pounds worth of land and other public sector assets.
A document setting out the scope of the spending review, which will report on November 25, confirmed additional investment in the NHS and defence.
However officials pointed out that the Ministry of Defence alone currently owns around 1% of all the land in the UK - some 227,300 hectares.
Altogether, despite £1.7 billion worth of disposals in the last parliament, the Government still owns more than £300 billion worth of land and buildings.
Mr Osborne said the further savings - which follow the £12 billion in welfare cuts and £5 billion from tackling tax avoidance announced in the Budget - will complete the Conservatives' plan to eliminate the deficit in the public finances.
"We have shown with careful management of public money we can get more for less and give working people real control over the decisions that affect them and their communities," he told MPs at Treasury questions.
"The spending review will deliver better government and economic security."