The Government's target of halving child poverty by the year 2010 was today looking unattainable after it emerged that child poverty has increased rather than fallen for the second year in a row.

The number of children living in households below the poverty line rose by 100,000 in 2006-07, the Department of Work and Pensions announced this morning.

The increase follows a similar rise of 100,000 in the year 2005-06.

"It's disappointing that for the second successive year we haven't seen any movement towards the child poverty target," said Hilary Fisher, the director of the End Child Poverty campaign.

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"This reflects both the size of the challenge, but also that the Government needs to make further financial commitments to achieve its goal. Without £3 billion of investment in tax credits and benefit the 2010 target to end child poverty will not be met.

"The UK is one of the world’s wealthiest countries, this is a problem we can afford to fix. What we cannot afford are the social and economic costs of continuing to fail our children."

The DWP also revealed that the number of pensioners whose incomes fell below the poverty line increased by 200,000 in 2006-07.

Tony Blair, the former Prime Minister, announced in 1999 the target of halving child poverty by 2010 and ending it altogether by 2020. The bold pledge came after child poverty rose inexorably throughout the 1980s and 1990s, increasing from 14 per cent of children in 1979 to 33 per cent in 1998-99, according to anti-poverty campaigners.

At the time Mr Blair made his pledge, the number of children in relative poverty – defined by the Government as living in households whose income was 60 per cent below median earnings – stood at 4.4 million (or 3.4 million before housing costs). By the end of March 2007, after nine years of economic prosperity in which incomes rose for most households, the number of children living in relative poverty stood at 3.9 million (2.9 million before housing costs), up from 3.8 million (2.8 million) the previous year.

Rosemary Bennett, social affairs correspondent of The Times, said that today's poor figures were because the Government had "taken its eye off the ball for a couple of years" in pushing through changes to child benefit and child tax credit to boost the incomes of the poorest families.

"Budgets came and went in 2004 and 2005 and nothing really happened," Bennett said.

"In the last year they have done a fair amount, but it will be a couple of years before the effects of that will be felt. In the meantime these figures are hugely disappointing, and a political embarrassment for the Government."

James Purnell, the Work and Pensions Secretary, said this morning that the vast majority of people were better off than they were ten years ago, and defended the Government's record.

"We have made significant progress on child and pensioner poverty in the last decade, lifting 600,000 children out of relative poverty and halving the number of children experiencing absolute poverty.

"Had the Government done nothing other than simply uprate the tax and benefit system, we estimate there would have been 1.7 million more children and 1.5 million more pensioners in poverty today."

Chris Grayling, Shadow Secretary for Work and Pensions, said today's figures were proof that Gordon Brown and his Government had run out of steam. "Their target of halving child poverty by 2010 looks totally unattainable and it is the children being brought up in some of our most deprived areas who will pay the price. To make matters worse, our poorest pensioners are also paying the price for the Government’s failures.”

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