The report says youth custody leads to reoffending

This would cut the number of young people sent into custody every year by about 65%, the report continues.

Giving most young offenders community sentences would cost the taxpayer less and reduce reoffending, the LGA added.

The Home Office said most juveniles in custody were there because of serious crimes or their risk to the community.

The report, to be launched at the LGA's annual conference in Bournemouth, is backed by ex-offenders' charity Nacro.

The LGA said the child prison population had risen by more then 50% since 1992 with children being locked up for about twice as long as they were in 1994.

Thousands of young people are caught in a vicious circle that condemns them to a life of crime and does nothing to make the nation a safer place LGA

LGA spokesman on children and young people Les Lawrence said more and more children were being locked up for offences that were "less and less serious".

"Thousands of young people are caught in a vicious circle that condemns them to a life of crime and does nothing to make the nation a safer place," he added.

"The worst offenders still need to go into custody as the protection of the public must be put first.

"But this year alone we estimate that more than 4,000 young people who didn't commit violent offences ended up behind bars."

Reoffending rates of 82% showed that "locking young people up simply doesn't work in many cases", he said.

Community sentences were not "an easy option" because they restricted where young people can go and what they can do, he added.

Inquiry recommendations

The LGA's call for change comes after an inquiry ruled that the murder of an Asian prisoner by a racist cellmate in his cell at Feltham Young Offenders' Institution could have been prevented.

Custody is detrimental to children's welfare. It is at best ineffective and, more frequently, counterproductive as a measure for reducing youth crime Nacro

Mr Justice Keith's inquiry found psychopathic killer Robert Stewart should have been identified as a risk two years before he was put in a cell with Zahid Mubarek.

One of Mr Justice Keith's recommendations was to eliminate enforced cell sharing.

Mr Lawrence said the LGA's plan would help to ensure that recommendation was met.

Nacro's Tim Bateman said the costs of locking up children were far too high.

"Custody is detrimental to children's welfare. It is at best ineffective and, more frequently, counterproductive as a measure for reducing youth crime.

"It is wasteful of resources which might be put to better use to prevent offending."

Juvenile establishments provide a safe and well-ordered environment for their young people, ensuring that there are real opportunities for learning and for positive change Home Office

In 2004/2005, youth custody in England and Wales cost �245m.

A Home Office spokesman said: "Juvenile establishments provide a safe and well-ordered environment for their young people, ensuring that there are real opportunities for learning and for positive change."

Managers and staff in juvenile detention establishments "are working all the time, in continually changing circumstances, to achieve the right combination of care and control necessary to contribute effectively to the overarching aim of preventing reoffending by young people," he added.