Police chiefs are planning cuts of around £20 million from next month because of the political instability.
The uncertainty has left the PSNI facing a 3 per cent budget reduction, the force said.
Its under-staffed numbers are under serious threat from dissident republicans who shot an officer in January while investigating major murders is taking up vital community policing resources, rank and file officers warned.
Police Federation for Northern Ireland chairman Mark Lindsay said: "We don't think there is room for cuts.
"For the last number of years they have not only cut to the bone - they have cut into the bone."
He said major murder investigations like that into the shooting of George Gilmore in Carrickfergus on March 13 were diverting officers from solving local crime.
Mr Lindsay said the PSNI budget had been slashed by around £300 million since 2010 and manpower numbers were depleted.
Power-sharing is in limbo as crisis talks continue and no Stormont budget has been set for the next financial year, which begins next month.
Legislation allows the permanent secretary in the Department of Finance to take control if a budget act has not been passed at least three working days before the end of the financial year.
The official can access money not exceeding 75 per cent of this year's spending pot and direct how it is spent.
If there is still no deal by the end of July that official can spend an amount equivalent to 95 per cent of this year's budget.
A statement from the PSNI said: "PSNI has been asked by the Department of Justice to provide a profile of expenditure for 2017-18 based on a net 3 per cent reduction on opening budgets.
"This work has been completed but only at a very high level and further work will continue until an agreed budget is in place.
"It is up to the politicians to set the budgets and we will work within the funding envelope which we are given, however ongoing uncertainty makes long-term planning more difficult so we look forward to a budget being set as soon as possible."
