Three years after the Government set a target to halt the rise in childhood obesity, the strategy is mired in "dithering and confusion," a committee of MPs says today.

In a scathing report on ministers' failure to tackle the obesity epidemic, MPs say that misplaced concern about stigmatising fat children is putting their health at risk. Edward Leigh, chairman of the Public Accounts Committee, which published the report, said that officials had not decided whether to tell parents that their children were overweight. He warned that vital time in the battle to contain bulging waistlines had been lost.

Me Leigh said: "The extent to which children in this country are obese is alarming. Unless we act, the proportion will rise sharply."

"If a primary school finds that a child is overweight, the parents must be informed. The Department of Health must decide on the best way of giving this information to parents."

Almost one in seven children (13.4 per cent) aged between two and 10 are obese, an increase of a third in a decade. The proportion of under-16-year-olds is predicted to reach 20 per cent by 2010 if nothing is done.

The situation has got so bad, with increasing rates of diabetes and other chronic diseases in overweight young people, that the National Institute for Clinical Excellence has said some would need stomach stapling surgery in guidelines issued last December.

In 2004, the departments of Health, Education and Culture, Media and Sport, set a joint target to halt the increase in obesity in the under-11s by 2010. But the committee found the strategy was marked by delays, disagreements and set-backs and that the lack of statistics meant it was impossible to tell if any progress had been made.

A campaign aimed at parents, teachers and children is yet to be launched, there are no ring-fenced funds or specific programmes and efforts to curb the marketing of unhealthy foods by the food industry have failed, the report said.

Cutting out one chocolate biscuit a day was all it took for a child to lose weight, but the message had been lost in the argument over targets.

The Children's commissioner, Professor Sir Al Aynsley Green had warned that identifying fat children could lead to bullying but MPs said that failure to do so could put children at risk of serious illness.

Mr Leigh said obesity was already costing the NHS £1bn a year and could cost another £1bn a year by 2010 on current trends.

"It is lamentable that, long after the target was set, there is still so much dithering and confusion and still so little co-ordination."

"When [a campaign] finally appears, it must bring home the risks of being obese and show that a small change to behaviour can help lose weight," he said.

Public Health Minister Caroline Flint said: "There are no easy answers or quick-fix solutions. Changing behaviour requires long-term action on a number of fronts and that is what we are putting in place."

A spokeswoman for the Department of Health said that officials were still considering how to involve parents. "It is not a case of telling them they will have their children weighed and measured whether they like it or not. We can't do that."