Researchers at the London School of Economics estimate that 765,000 people In England will have Alzheimer's and similar diseases by 2031 - up 66%.

The projected rise will be largely due to the fact that people will be living longer and will therefore be at greater risk of developing the condition.

These figures show the urgent need to find an effective and permanent treatment for Alzheimer's and other forms of dementia Rebecca Wood, Alzheimer's Research Trust

But the researchers have warned that numbers could be even higher unless a cure or better treatments are developed.

In a report for the Alzheimer's Research Trust, they suggested there was a financial incentive to improve medical care for dementia patients.

High costs

Professor Martin Knapp and colleagues at the LSE estimate that the cost of providing long-term care for dementia patients will increase from �4.6bn at present to nearly �11bn in real terms over the next 30 years.

However, they say this sharp increase can be avoided if new cases of dementia could be cut by 1% each year.

At present, England spends just �11 per Alzheimer's patient per year on research, compared to �289 per cancer patient.

Professor Knapp said the findings highlight the need to improve drug treatments for dementia patients.

"These results highlight the importance of research to develop effective therapeutic strategies for the later stages of dementia.

"Treatments that delay the progression of dementia could delay the need for institutional care and enable older people to receive informal and formal care at home for longer."

Rebecca Wood, chief executive of the Alzheimer's Research Trust, said the report highlighted the need for money to be pumped into finding better treatments.

"These figures show the urgent need to find an effective and permanent treatment for Alzheimer's and other forms of dementia.

"Research in the UK is severely under-funded, yet offers a real hope for finding an answer to dementia."

She added: "This report also highlights the importance of developing appropriate formal services for those with cognitive impairment which is rising faster than overall figures for long-term care requirements might have indicated previously."

Liberal Democrat spokesman on Older People Paul Burstow said: "This report demonstrates the need for ministers to take an urgent look and a longer term view of the needs of dementia sufferers and their carers."

The findings of this study will be presented at a conference on ageing to be held at the British Academy in London on Thursday.