Tony Blair and Gordon Brown are on course to miss their targets on child poverty, as new figures show the number of children in relative poverty has increased.
The Department for Work and Pensions' (DWP) annual Households below average income report shows a 100,000 rise in the number of children in relative poverty between 2004-05 and 2005-06.
Figures on absolute poverty remain unchanged, while the number of pensioners in relative poverty fell by 100,000 over the same period.
Barnardos branded the figures a "moral disgrace". Chief executive Martin Narey said: "We are the fourth richest country in the world, we are a country where we can countenance individual bankers getting annual bonuses of £22 million while we give a family of two parents and two children, living on benefits, £10,000 to live on for a whole year."
Critics claim the government will now miss its target of halving child poverty by 2010 by more than three-quarters of a million children. It narrowly missed its last benchmark of reducing child poverty by a quarter by 2005.
"It is now clear that what they meant was that they intended, not to halve child poverty by 2010, but to reduce it a bit," argued Mr Narey.
Today's figures are "depressing" the Conservatives agreed, and show poverty is increasing.
Shadow chancellor George Osborne said: "Gordon Brown made tackling poverty the great promise of his chancellorship, and yet he leaves the Treasury with poverty rising.
"His whole approach of simply throwing money at the problem has failed. Now his con-trick Budget will make things worse by increasing the tax bills of the low paid, and reducing work incentives."
The Conservatives have called on the government to tackle the root causes of poverty, including family breakdown and broken communities.
To reassure anti-poverty campaigners, the DWP announced new measures it claims will target "thousands" of families.
The DWP will pilot New Deal for Families, to extend the benefits available to lone parents to all families with children. New Deal for Lone Parents Plus will also be launched to target lone parents and support them to find work ahead of David Freud's recommendations that parents of older children be obliged to work.
Jobcentre Plus will also be reformed to identify parents in the benefit system, recording the childcare needs of all parents. The partners of lone parents will also be offered help and advice including the introduction of mandatory six-monthly work-focused interviews.
Work and pensions minister John Hutton said: "We have made considerable progress against our historic goal to end child poverty in the UK, with 600,000 children helped out of poverty since 1997 and child poverty in the UK falling faster in the last ten years than in any other European country.
"But we need to go further towards what is a very tough goal to reach. The measures announced in the Budget and built on today will help take hundreds of thousands children out of poverty in the years ahead and emphasise the importance of work as the sustainable route out of poverty for families in Britain."
In last week's Budget, the chancellor promised to lift a further 200,000 children using tax credits and support for working parents.
However, Lib Dem work and pensions spokesman David Laws warned the measures in the Budget will not compensate for the 300,000 children missed in the 2005 target.
"Mr Brown must realise that combating child poverty through the 'one club' approach of tax credits has now run its course," he argued.
"We need a new approach focused on cutting regressive taxes, improving housing, targeting more money to improve education for the poorest children, and more support through child benefit."
In March 1999, Mr Blair pledged to eradicate child poverty within a generation, setting targets to reduce it by half by 2010. The government narrowly missed its target to cut poverty by a quarter by 2004-05.