Consumer group Choice has identified popular products that are using the health star labelling system in creative ways. Milo touts a 4.5 star health rating on its tin, but closer inspection reveals this is when the product is made up with skim milk. On its own Milo is only rated 1.5 stars.

Several Kellogg's cereals, such as Fruit Loops and Crunchy Nut Cornflake Clusters, show a higher star rating on a panel explaining the health star rating system than the actual star rating the product has been given and that features on the front of the box.

"We have seen big global food companies such as Nestle gaming the health star rating system," Choice spokesman Tom Godfrey said. "This is one area of the health star scheme we'd like to see the government improve."

Research commissioned by the federal government on the scheme found one in six shoppers had bought a product they didn't normally buy, because it had a higher health star rating. Sixty per cent of consumers would like to see the ratings on more products.

Mr Godfrey said some of the unhealthiest food manufacturers like McCain, Goodman Fielder, Mars and PepsiCo were being very slow to put the health star labels on their packaging "for fear consumers will look past their neatly massaged brands to see what they are actually eating".

Deakin University professor of public health nutrition Mark Lawrence said the health star rating system was being exploited as a marketing tool by junk food manufacturers to make consumers think their food was healthy. He said the scheme for packaged food undermined the public health message that people should eat fresh, unprocessed food.

"This has become not so much a public health campaign as a marketing campaign for junk food companies," Professor Lawrence said. "It's creating consumer confusion."

He said it should be mandatory for companies to put the health star ratings on their packaging, but the ratings should not be used for treat foods. "We should put warnings on discretionary foods."

Advertising expert Dee Madigan said consumers should not take any food label like a health star rating at face value.

"You've got a brain, you've got the internet, do the research," Ms Madigan said. "Anything on the label is there to sell the product. Look at what they consider healthy and make sure it's what you consider healthy."

Nestle spokeswoman Anita Catalano said it was appropriate to apply a health star rating to Milo based on how it was recommended to be consumed, with a glass of skim milk. "For us, adopting the health star rating scheme is not about selling more products, it's about living up to our responsibility to help our consumers adopt a healthy and balanced diet," she said.

Kellogg's told Fairfax Media it is amending all its cereal packaging so the actual health star rating of the product will match with the health star fact box, which should be completed soon. Kellogg's said sales of Nutrigrain had gone up after it reformulated the ingredients so the cereal's health star rating went from 2 stars to 4 stars.