1.1m children forecast to fall back into poverty But the Department for Work and Pensions said the projection could not take account of the impact of the Coalition's benefits overhaul in getting parents off benefit and into work. It estimates that the new Universal Credit will make 3.1 million families better off by £160 a month. The department also argued that the current poverty measure, which is based purely on household income levels, does not give a true reflection. Children growing up in families in which the household income is less than 60 per cent of the median are officially classed as in poverty under the current measure. But Iain Duncan Smith, the work and pensions secretary, is in the process of setting a new definition of poverty which will take into account a raft of other factors including family break-up and low school attainment. The IFS said that the new forecast took account of the economic downturn and a £20 billion cut to the social security budget but - most significantly - a statistical revision to the earlier figures. Nevertheless Alison Garnham, chief executive of Child Poverty Action Group, said: "Today's dire projections reveal we are in danger of failing the next generation. The Government has child poverty targets and a child poverty strategy because it knows poverty destroys life chances and generates huge costs to our economy. Today's figures must lead to a rethink of a strategy that not only isn't working but looks set to turn the child poverty problem into a child poverty crisis in the years ahead. Liam Byrne, the shadow work and pensions secretary, said: "The IFS's verdict is clear - by both internationally recognised measures, this Government is set to plunge over a million children into poverty by the end of this decade, undoing all the good work of the last Labour government. Children are paying the price for a flatlining economy, falling living standards and soaring unemployment. Yet instead of giving working families a hand ministers have slapped them in the face by slashing their tax credits whilst handing a massive tax cut to the richest people in the country. A DWP spokesperson said: "Despite paying out £170 billion in tax credits alone, the previous government failed to meet their target to halve child poverty by 2010 and far too many children were left behind. That is why we want to take a new approach by tackling the root causes of poverty including worklessness, educational failure and family breakdown. The IFS analysis does not fully take into account the dynamic and behavioural changes that will result from our welfare reforms. In fact, the changes under Universal Credit will make three million households better off and lift up to 250,000 children out of poverty.