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Overweight people on benefits who do not exercise could end up paying for it financially if strict new proposals are accepted.
A report by Westminster County Council and thinktank the Local Government Information Unit (LGIU) says doctors should be able to prescribe exercise and if people do not follow the advice, their benefits could be cut.
The report, A Dose of Localism: The Role of Council in Public Health, suggests that smart cards could be used to monitor people's exercise at sports facilities.
It says: "Several local authorities have schemes that allow GPs to prescribe physical activities at local facilities including council swimming pools, gyms, yoga and walking clubs.
"Local authorities should consider making provision for prescription of leisure activities in their service level agreements with providers.
"Re-localisation of council tax benefit and housing benefit combined with new technologies provide an opportunity for councils to embed financial incentives for behaviours that promote public health.
"The increasing use of smart cards for access to leisure facilities, for instance, provides councils with a significant amount of data on usage patterns.
"Where an exercise package is prescribed to a resident, housing and council tax benefit payments could be varied to reward or incentivise residents."
Obesity costs the NHS £5.1bn every year. If the proposal were accepted, it could be implemented from April.
Potential for significant improvements
There is concern that the plan could be jeopardised because of uncertainty around public health funding, partly caused by a proposed formula the government will use to allocate money to local authorities.
Councillor Philippa Roe, leader of Westminster City Council, said: "This report contains exactly the sort of bright, forward-thinking and radical ideas that need to be looked at. Local government needs to seriously start considering how it is going to manage public health before April arrives - it is only four months away.
"The potential improvements to the nation's health and to the public purse could be significant. But for this to work, government needs to sort out the position around the funding formula for public health.
"There are clearly internal disagreements in Whitehall. This is not helpful and government needs to get a grip of this urgently."
But the suggestion that fat people should be forced to exercise or have their benefits cut has met with an angry response in some quarters. The Lib Dem's Baroness Hussein-Ece called the move "completely outrageous".
Harry Rutter of the London School of Hygiene and Tropical Medicine said: "Aside from the obvious moral question, how can anyone possibly think this is a good idea?"
Nutritionist and fitness coach James Carlsson said: "So wrong. Who comes up with these ideas?"
There has been some support for the proposal, with some Twitter users calling the move "common sense" and others saying "about time".
The LGIU said: "[The] aim of the report is to give councils the tools to incentivise [people] to live healthily, not to attack fat [people]."
Other users, however, suggested that the same rule should apply to MP Eric Pickles. Peter Savage said: "Does this mean Pickles will no longer get subs in House of Commons canteens?"