It may be the current European Capital of Culture, but Liverpool still has serious problems.

The statistics that confirm the city as the country's capital of deprivation prompted the Health is Wealth Commission, a non-governmental organisation funded by the University of Liverpool, to compile a report that gives a graphic insight into the scale of the problem.

The report shows that incapacity benefit levels in Liverpool are almost 75 per cent higher than the British average, with one in eight people of working age claiming benefits. It also found that people in the city are a third more likely to die from cancer, more than twice as likely to die from liver disease and have a life expectancy three years lower than the national average.

In addition, every day nine people in the region die from smoking-related disease, five die from heart disease or stroke, and six die from cancer. The report also reveals that the city has 15,000 drug users and that 178,000 people in the area are classed as being in poor health.

The commission has drafted an action plan to help alleviate the city's poverty woes, including a proposal to create an institute in the city to study local health improvement.

Sue Woodward, the chair of Health is Wealth, said: "As we count the cranes on the Liverpool skyline and enjoy the rave reviews in the Sunday supplements, the time is right to stand up and face the elephant in the room: generations of families dependent on benefits; the spiralling problem of alcohol misuse; the creation of a super underclass; an invisible army of people disconnected and cut off from the opportunities created on their own streets; lives cut short through inequality and deprivation. Doing nothing is not an option."