Young offenders are being fast-tracked into a life of crime by criminal justice policies that treat them as fully mature adults, a new report says.
The report says young men naturally grow out of criminal behaviour
Youngsters are exposed to hardened criminals in jail and cut off from support services, the report for charitable trust Barrow Cadbury said.
Instead funding should focus on supporting young offenders in their transition to adulthood, it argued.
Nearly 75% of young offenders re-offend after they are released from prison.
'Grow out of crime'
Chairman of the Barrow Cadbury Commission Greg Parston said: "Our failure to address the needs of young adult offenders in transition to adulthood is wasting money.
"If we want safer communities we need an end to the 'one-size fits all' solution for young adult offenders."
Public services need to be better geared to help young people in trouble grow into adulthood leading crime-free lives, he added.
The commission points to the £800 million cost of imprisoning 18-24-year-olds and says this group is responsible for £20 billion worth of crime annually.
But according to the report most young men will "grow out" of crime after the age of 18 - and the majority will desist naturally at the age of 23.
75% of young offenders re-offend after leaving prison
Using prison sentences is counterproductive and magistrates should avoid imposing custodial sentences until the age of 23, the report said.
It also argued that young offenders under the age of 23 should not be required to disclose their criminal convictions to potentional employers.
Instead the system should tailor provision on the basis of maturity not age, it added.
And the Independent Police Complaints Commission and the Home Office should set up a young adult advisory group to discus how young people are policed, it added.
This ought to look at the disproportionate impact of policing on black and ethnic minority young adults.
The independent Commission on Young Adults and the Criminal Justice System was set up in the summer of 2004 by the Barrow Cadbury Trust.
A range of people involved in the criminal justice system, including doctors, lawyers and criminologists, were invited to give evidence.