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A government review suggests that small-time criminals driven by their drug habit need help rather than prison time.
Dame Carol Black warns in her review that many drug users are "cycling in and out" of prison without being rehabilitated or their abuse being treated effectively.
Her review also found that the drugs market is driving most of the nation's crimes with half of all homicides and half of acquisitive crimes linked to drugs.
A new drugs unit will be set up to help end illegal drug-related illness and deaths.
The Joint Combating Drugs Unit will combine multiple Government departments, including the Department of Health and Social Care, Home Office, Ministry of Housing, Communities and Local Government, Department for Work and Pensions, Department for Education and Ministry of Justice, to help tackle drug misuse across society.
Her findings set out more than 30 recommendations to Government to help overcome the harm drugs have caused to individuals, families and communities across the country.
The recommendations made in the report include investing more than £550 million in extra funding for drug treatment in the community, and the appointment of a minister on drug policy to hold the Government to account on its efforts.
It also recommends drug addiction be recognised as a chronic health condition which requires long-term follow-up.
Dame Carol said the Government faces an “unavoidable choice” when it comes to illegal drug use in society.
She said: “Invest in tackling the problem or keep paying for the consequences. A whole-system approach is needed and this part of my review offers concrete proposals, deliverable within this Parliament, to achieve this.”
Health Secretary Sajid Javid welcomed the review’s findings.
He said: “When I first commissioned Dame Carol to do this review as Home Secretary, we knew the sale and use of drugs drives serious violence and homelessness but this review shows that the health implications are just as devastating