Poverty has increased for the first time in almost a decade and the number of children living in poor families has risen for the first time in six years, the government admitted yesterday.
Opposition politicians and poverty campaigners said a core government policy was failing and warned that its 2010 target could be missed by a million children, in spite of measures announced by Gordon Brown in last week's budget.
Official figures showed relative poverty - those living on less than 60% of average incomes - rose to 12.7 million people in 2005-06, from 12.1 million the year before.It brings to an end the longest period of falling poverty since records began in 1961. The number of children living in poor families rose by 200,000 to 3.8 million.
A single person is now considered poor if he or she earns less than £145 a week, while a couple with two children is poor if their income is less than £332 a week.
The employment minister, Jim Murphy, acknowledged that the figures were a setback. "We are absolutely determined to hit the target and we think our new strategy will get us back on track," he said, referring to a plan unveiled yesterday encouraging more parents into work. Mr Murphy said that over the past decade Britain had seen the biggest fall in child poverty of any country in the European Union.
The Institute for Fiscal Studies said the rise in poverty was due to the fact that tax credits and benefits rose less quickly than average earnings last year. As increases were modest this year and would be next, it added, poverty may get worse before it gets better.
"The latest poverty and inequality figures will have made grim reading for the chancellor," said IFS economist Luke Sibieta. "Today's figures suggest that if the squeeze on public spending announced last week limits Mr Brown's capacity to play Robin Hood over the next few years, poverty and inequality may return to an upward trend and his child poverty target will drift further out of reach."
Mr Brown announced £1bn more in tax credits for poorer families in last week's budget. Experts think that could lift 200,000 children out of poverty, but that would only be a fifth of the way to the 2010 target of one million. The IFS says the government would need to spend £4bn extra by 2010 on help for poor families to make its target achievable but Mr Murphy said the new strategy was about getting more parents into some of the 600,000 vacant jobs available. "People should never be better off on benefit." The shadow chancellor, George Osborne, said the "depressing" figures showed "that poverty is increasing, inequality is rising, and the incomes of the poorest fifth are in decline. Gordon Brown made tackling poverty the great promise of his chancellorship, and yet he leaves the Treasury with poverty rising." The Liberal Democrat work and pensions spokesman, David Laws, said: "These figures are dreadful for the government, with child poverty rising to almost a third of all UK children. Poverty in Britain is increasing again, and social mobility seems to have been falling. The government's ambition to cut child poverty now looks in tatters."
The figures showed a fall in pensioner poverty, but Help the Aged said the drop was small. "They are trying to hide a clear stagnation in pensioner poverty," said spokeswoman Anna Pearson.
In a separate report on poverty, the Joseph Rowntree Charitable Trust found hundreds of asylum seekers suffering destitution and living in "appalling and inhumane" conditions on the street after their claims were refused. It said some refused asylum seekers were too scared to get healthcare, with one woman who suffered a miscarriage fearing she would be deported if she sought medical help.The report, co-written by the Conservative vice-chair Sayeeda Warsi, said asylum seekers should be given special licences allowing them to work and contribute to British society.