More than 800,000 additional people could be considered for gastric bands or other surgery to restrict their eating under fresh NHS draft guidelines.

The guidance from Nice, the National Institute for Health and Care Excellence, aims to help the increasing numbers of people with type 2 diabetes. About 10% of the NHS budget is spent on dealing with diabetes, with type 2 – sometimes genetic but usually linked to a person being overweight – the chief cause.

Nice is proposing lowering the threshold for considering bariatric (stomach-reducing) surgery for people with newly diagnosed type 2 diabetes to a BMI of 30, which is the point at which overweight begins to be classified as obesity. Until now, it has said that people with type 2 diabetes could be considered for a gastric band at a BMI of 35.

If the change in guidance is confirmed, it would mean a huge rise in the numbers who could be referred for assessment and possibly surgery if their doctors think it appropriate. There has been a substantial increase in the numbers of people receiving stomach-reducing surgery over the past five or six years to about 8,000 in 2012-13, according to the health and social care information centre's latest report this year.

But experts calculate that the new guidance could mean that more than 800,000 people in England and Wales could be eligible if their doctors think they are suitable.

Nice says the change would be highly cost effective. "More than half of people who undergo surgery have more control over their diabetes following surgery and are less likely to have diabetes-related illness. In some cases, surgery can even reverse the diagnosis," said Professor Mark Baker, director of Nice's Centre for Clinical Practice.

But Diabetes UK still believes that surgery should be a last resort. "Although studies have shown that bariatric surgery can help with weight loss and have a positive effect on blood glucose levels, it must be remembered that any surgery carries serious risks. Bariatric surgery should only be considered as a last resort if serious attempts to lose weight have been unsuccessful and if the person is obese," said Simon O'Neill, director of health intelligence and professional liaison.

"Bariatric surgery can lead to dramatic weight loss, which in turn may result in a reduction in people taking their type 2 diabetes medication and even in some people needing no medication at all.

"This does not mean, however, that type 2 diabetes has been cured. These people will still need to eat a healthy balanced diet and be physically active to manage their diabetes."

Diabetes UK is currently supporting a trial of a very low-calorie diet for people with type 2 diabetes, followed by long-term weight management. "If a very low-calorie diet can be used within routine GP care to bring about and maintain weight loss and type 2 diabetes remission, it could ultimately be of enormous benefit to millions of people living with the condition," said O'Neill.

"But the full results will not be available until 2018. Until we have the evidence that this approach is more effective than the current best-available treatment, we do not recommend that people with type 2 diabetes attempt to lose weight this way."

Nice's guidance also recommends that these very low-calorie diets, where people eat fewer than 800 calories a day, should not be routinely used and recommended only for people who urgently need to lose weight – for instance, before joint replacement surgery.

If the stomach surgery guidelines are confirmed, there will be pressure on hospitals. There are already long waits to join the assessment clinics where psychologists and others help patients to understand the consequences of bariatric surgery, which involves permanent change to the sorts of foods as well as the quantities people can eat.