Time is being called on happy hours and two-for-one offers on alcoholic drinks as figures indicate that excessive drinking puts 800,000 people in hospital a year at a cost to the NHS of £2.7 billion a year.

The Department of Health said today that it would force retailers to rein in the use of happy hours, where drinks are sold at discounted prices, and stop shops from displaying bottles at the counter.

Dawn Primarolo, the Public Health Minister, said that pubs and bars should serve drinks in smaller glasses to reduce the amount of alcohol consumed and train staff to recognise when people have had too much.

She said: “Around a quarter of the population drink to a harmful level. These people could be drinking themselves into an early grave — we need the drinks industry to give them the help and information needed to drink at a safer level.”

Research has found that alcohol retailers and manufacturers have flouted their own codes of practice, and the scale of the effects of England’s binge-drinking culture has been vastly underestimated.

More than 800,000 people were admitted to hospital last year because of alcohol-related illnesses, according to new figures out today. The Office of National Statistics had put the figure much lower at 200,000 because it omitted admissions for alcohol-related heart disease, cancer, and strokes. The Government said that more that 10 million people are drinking above the recommended daily amounts.

Previously admissions statistics counted only the three most common types of alcohol-related diseases: alcoholic liver disease, alcohol poisoning, and mental and behavioural disorders.

The new figures measure 44 conditions caused by or strongly linked to alcohol consumption. There were 811,000 admissions in 2006 (accounting for 6 per cent of all admissions) compared with 473,500 in 2002.

A review into the drinks industry, also published today, found that retailers and manufacturers are flouting the industry’s own voluntary standards. Manufacturers have until the end of the year to label bottles of alcohol with health information. If they do not comply the Government will introduce a mandatory system of labelling for all alcoholic beverages.

The industry agreed to put unit information on bottles in 1998, but a recent study by the consultants KMPG found that 43 per cent of products surveyed failed to include it and only 3 per cent followed the labelling scheme fully.

Meanwhile, interim findings from a price and promotion review by the University of Sheffield indicate a strong link between the sale of cheap alcohol and increased consumption, with young people and those already drinking most at risk.

Ms Primarolo said: “The drinks industry has a vital role to play if we are to change the country’s attitudes to alcohol. Some sections of the industry are sticking to the voluntary codes, others are blatantly ignoring them.”

Don Shenker, Chief Executive of Alcohol Concern, said: “We very much welcome the findings from the various reports which clearly show a big increase in alcohol-related health harms. The ideas put forward for consultation make eminent sense if the Government is going to achieve a reduction in alcohol-related harms and if it is going to meet its own targets to reduce harmful drinking.”

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