Former Prime Minister Tony Blair announced in 1999 the target of halving child poverty by 2010 and eliminating it by 2020.

But Department for Work and Pensions (DWP) figures revealed 3.9 million UK children were classed as living in poverty in the year 2006/07, an increase of 100,000 on the previous year. For pensioners, the figures rose to 2.1 million, up 200,000. The DWP calculated poverty before and after household costs.

Charities and politicians rounded on the Government claiming not enough had been done to tackle the problem.

Save the Children said they were "shocked" by the rise which they described as a "poor result", while Help the Aged said the Government should be "mortified by the latest rise in pensioner poverty".

Shadow work and pensions secretary Chris Grayling said the figures showed the Government had "run out of steam".

But the Government insisted they were still committed to tackling poverty. Employment and Welfare Reform Minister Stephen Timms acknowledged the figures represented a slip. He said: "We are committed to tackling poverty and providing opportunity for all, and these figures confer with very substantial progress over the last decade to large numbers of children and pensioners lifted out of poverty in relative and absolute terms."

The report calculated the benchmark for low income as less than £226 per week based on a couple with no children.

Save the Children spokeswoman Phillipa Hunt said: "We are shocked that the number of UK children living in poverty has increased - an additional 100,000 children are now living in poverty since last year. This is a poor result that will be a setback to the Government's target of halving the number of children living in poverty by 2010."

Gordon Lishman, director general of Age Concern, said: "It is a national disgrace that pensioner poverty levels have begun to rise. The Government is failing those that need their help the most and the progress they have made on pensioner poverty is in danger of unravelling."