The Serious Youth Violence report, from the parliamentary home affairs committee, calls for local authority funding for youth services to be ringfenced and focused on preventing young people becoming caught up in violence.
The guarantee should be underpinned by a "fully-funded, statutory minimum for youth outreach workers and community youth projects in all areas", states the report.
The report adds this needed to be coupled with "proper mental health provision" for young people, "informed by an understanding of the impact of trauma and other adverse childhood experiences".
The committee, chaired by Labour MP Yvette Cooper, also recommends focusing greater provision in areas which most need it, such as those where under-25 knife crime and school exclusions are particularly high.
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The committee describes current government investment in addressing youth violence as "completely inadequate" to tackle the "social emergency".
It criticises government rhetoric on a "public health" approach to violence, claiming that there is a "serious mismatch" between the diagnosis of the problem and its proposed solutions.
The MPs also recommended that schools with a higher risk of violence should be given dedicated police officers, with efforts made to get an officer attached to all such schools by April 2020.
The inquiry highlights the connection between deprivation and vulnerability to knife crime and serious youth violence.
It links school exclusion and knife crime, suggesting that our education system is currently failing many children, including those most in need of holistic support and early intervention.
It adds that providing only part-time timetables in alternative provision is also a serious failing, because most excluded children are in need of more social, educational and emotional support, not less.
The highly critical report concludes that the current epidemic of youth violence has been exacerbated by a perfect storm emerging from cuts to youth services, heavily reduced police budgets, a growing number of children being excluded from school and taken into care, and a failure of statutory agencies to keep young people safe from exploitation and violence.
Cooper said: "Teenagers are dying on our streets, and yet our inquiry has found that the government's response to the rise in serious youth violence is completely inadequate.
"They just haven't risen to the scale of the problem.
"The rhetoric about a public health approach is right, but too often that's all it is - rhetoric.
"There are no clear targets or milestones, and no mechanisms to drive progress.
"To publish a weak strategy and convene a few roundtable discussions just isn't enough when faced with youth violence on this scale.
"The Home Office has shamefully taken a hands-off approach to this crisis, but it is a national emergency and must be treated like one."
Anne Longfield, the children's commissioner for England, described the report as "hard-hitting", adding that it exposes the dangers faced by many thousands of vulnerable children to grooming by criminal gangs.
"Many of the mistakes that led to failings in child sexual exploitation are now being repeated," said Longfield.
"They are generational, complex and will require significant funding to turn around.
"Until the government treats this as a top priority, young people will continue to be caught up in gangs and serious violence, and children will continue to die on our streets."