The number of children living in poverty rises by 100,000 - despite Government pledge to halve it by 2011

The number of children living below the poverty line has risen by 100,000 to 2.9million - the second increase in two years.

Ministers admitted that half of the newly impoverished children come from working families, many of them two-parent households where the mother chooses to stay at home.

Children's Minister Beverley Hughes said that these women are failing 'to maximise their ability to work'.

Figures show there were 3.8million children living in poverty in 2007

Gordon Brown was Chancellor nine years ago when Labour set its target of eliminating child poverty by 2020. He brought in the tax credits system as the main means of achieving this goal.

But yesterday's figures from the Department of Work and Pensions showed that child poverty stopped decreasing in 2005. The latest count, covering the financial year which ended in March 2007, showed there were 2.9million children in poor families.

This means the number of poor children has been cut by just 600,000 - a figure
which allows for statistical rounding - since the promise was made in 1999.

Mrs Hughes said yesterday it was difficult to reduce poverty figures using a count of 'relative poverty' - the method Mr Brown favoured both in opposition in the mid-1990s and as Chancellor.

She said: 'We know the groups affected over the past two years. Half of those are in working families: people with only one person in work or working temporarily. It is in part the inability to maximise their ability to work or to stay in work.'

Critics of the Government said that ministers were penalising married and co-habiting couples with children with a 'penalty' built into tax credits.

Fiscal consultant Don Draper of the charity CARE said: 'Well over half of all poor children live in couple households and most in households where one or both parents is in paid work.

'Until the Treasury accepts it has made a fundamental mistake with the design of tax credits there seems little hope that there can be any long term reduction in child poverty.'

Ministers are falling short of meeting their flagship pledge to halve child poverty by 2010, they will admit tomorrow.

They are due to unveil figures showing that they have made little or no progress over the last year in reducing the number of children in poverty.

Last year the numbers of children in poverty-stricken households went up and the Tories say Labour delayed today's announcement to avoid embarrassment before last month's local elections.

We can't afford a car

Sarah Ley decided to stay at home to look after her three children.

But that means she and her husband Adrian are one of the families who have failed to heed the Government's advice to 'maximise their ability to work'.

As a result, they face falling below the poverty line.

Sarah Ley with Laurie, nine, and Lucie, seven. The family is living below the poverty line

Mr Ley, 38, is a self-employed children's entertainer whose earnings fluctuate. His income - £8,680 in 2006 but more than £12,000 last year - is supplemented by tax credits and child benefit.

However, because Mrs Ley does not work for 16 hours a week or more she does not receive Working Tax Credit.

She said: 'We can't afford a new car. We have never had a foreign holiday.

'We don't go to restaurants, we don't drink or smoke and we don't go out very often. I knit and sew and we grow some of our own vegetables.'