SOARING obesity rates, falling fruit and vegetable intake and a fast-food industry cashing in on an appetite for fatty foods - Australians seem to be gluttons for punishment.

A damning government report on nutrition and dietary habits said more than 60 per cent of adults and almost a quarter of children aged 2-16 are either overweight or obese.

It's leading to serious health problems such as heart disease and diabetes, costing more than $8 billion a year in health care and lost productivity.

But it's little wonder our waistlines are growing, with almost 30 per cent of the average household food budget spent on fast food and eating out.

The Australian Institute of Health and Welfare report found the average family spent more each week on alcohol than meat, fruit and vegetables.

Even when families buy healthy food, much of it ends up in the bin -- with an average $600 worth of food thrown out annually per household.

Of an estimated total

$5 billion worth of food disposed of annually, $1.1 billion was fruit and vegetables.

AIHW spokeswoman Lisa McGlynn said more than 90 per cent of adults did not eat the recommended five serves of vegetables each day -- and half did not eat enough fruit.

"The good news in all this is that we know the state we're in and we know what we can do about it," she said.

"We can all start with small changes like just having a couple of extra pieces of fruit or serves of vegetables."

Newcastle family day-carer Robinanne Lavelle said she often saw parents packing their children's lunch-boxes with processed foods, sandwiches smothered in chocolate spread and lollies.

"We're in a society where we have a lot more money than we did a few decades ago and children are often becoming the ones who choose these products," she said.

"I believe working parents who are short on time might not want the hassle while they are out at the shops so they will buy something just because the children want it."

According to the report, lower income earners, Aborigines and Torres Strait Islanders were most at risk from poor diet and obesity. With healthy food costing up to 30 per cent more for people living in rural and remote regions, they too were at increased risk.

Dietitians Association of Australia spokesman Dr Trent Watson called for a fundamental change in the way authorities tackled the problem, with more funding for prevention.

"Unless we start shaping our health care system to target these determinants of health as an absolute priority, we're going to be in an unsustainable position," he said.

Originally published as The deadly Aussie diet