Local authorities should be allowed to reinvest back into the community a share of the financial rewards they secure improving the health of residents, a leading think tank has advocated.

The call for a ‘community cashback' scheme is among a number of behavioural change incentives contained in Control Shift, a new Demos report issued today.

It argues this reward system could also be extended to incentivise community-led solutions across a range of major public policy issues including crime, cohesion and regeneration.

Known as ‘nudge plus' proposals, - termed after the phrase coined in US-based academic Richard Thaler's influential 2008 book entitled ‘Nudge: Improving decisions about health, wealth and happiness' – the study outlines an approach which rewards and encourages responsible behaviour rather than punishing the irresponsible.

Prioritising people who make healthier lifestyle choices for non-emergency hospital appointments, and the setting up by Government of an independent Risk Commission to combat a developing ‘compensation culture' are among other key report recommendations for promoting a culture of ‘getting back what you put in'.

Some councils are already considering using ‘nudge' theory to implement the new public health roles they assume next month. In January, a joint study from Westminster City Council and the Local Government Information Unit urged councils to use smart cards to incentivise and monitor residents claiming council tax benefit and housing benefit to improve their health – and help cut the NHS' weighty £5.1bn obesity bill.

Report author, Max Wind-Cowie, said: ‘Government and the private sector should adopt an enabling and pro-active approach to supporting individuals, families and communities into doing the right thing and taking more responsibility – it is no longer enough to simply step back and assume people will fill the gap.'