In the UK, three out of four people with mental illness are receiving no treatment, reveals report.
The report, published by the London School of Economics (LSE), says the lack of treatment for people suffering from mental health problems is the most "glaring case of health inequality" in Britain.
Among people under the age of 65, mental illness now accounts for nearly half of all ill health suffered by people in Britain and is generally more debilitating than most chronic physical diseases, the report published on Monday concluded.
Effective psychological therapies exist but are not widely available and only a quarter of sufferers are receiving treatment, the report by the LSE's Mental Health Policy Group found.
It is thought that around two-fifths of patients suffering from anxiety or depression can recover if they are treated by methods such as cognitive behavioural therapy.
The authors -- a distinguished team of economists, psychologists, doctors and NHS managers -- say that if such treatments were more widely available it would cost the NHS little or nothing overall because it would produce savings in other areas of healthcare.
They estimate that mental health problems which manifest themselves in physical symptoms cost the NHS at least ten billion pounds.
"Despite the existence of cost-effective treatments it (mental illness) receives only 13% of NHS expenditure," they wrote.
LSE Professor Lord Richard Layard, who convened the report's authors, argues that mental health is so prevalent in society that it deserves its own cabinet minister.
"If local NHS commissioners want to improve their budgets, they should all be expanding their provision of psychological therapy," Layard said.
"It will save them so much on their physical healthcare budgets that the net cost will be little or nothing.
"Mental health is so central to the health of individuals and of society that it needs its own cabinet minister."
The British Medical Association (BMA), the professional association and trade union for doctors, welcomed the reports' findings.
"The BMA is concerned about the poor physical health and early death of many with serious mental health problems, and views this as a major inequity that must be addressed," it said in comments quoted on the LSE's website.
"We will be undertaking more work on this area in our next session and today's report is an excellent starting point for that work."