Chancellor Alistair Darling has announced plans to help meet the government's child poverty target.
The government is at risk of missing child poverty targets
The Budget revealed changes to child benefit and housing and council tax benefits from 2009.
It has been widely predicted that the government is in danger of missing its ambitious target of halving child poverty by 2010.
The plan, announced by Tony Blair in 1999, also outlined a wish to eradicate child poverty entirely by 2020.
The chancellor announced that from April 2009 child benefit for the first child would be increased to £20 a week - a year earlier than planned.
From the same date the child element of the child tax credit for families on low and middle incomes will increase by £50 a year above inflation.
Child Tax Credit is paid to families with children regardless of whether the parents work.
At present, families with incomes up to £14,495 a year should qualify for the child element of £1,845 a year for each child.
This child element is then gradually withdrawn from families with higher incomes.
Mr Darling also said he wanted to change the rules on housing and council tax benefit from October 2009, so that "parents were better off in work than on benefits".
He said child benefit would be disregarded when calculating income for housing and council tax benefit from that date.
The changes would cost the government about £900m a year when they all came into effect.
"If we are to build a fairer future for our children then we must eradicate child poverty in Britain," Mr Darling said.
Kate Green, chief executive of Child Poverty Action Group, said: "This is excellent news for Britain's poorest children.
"It keeps the 2010 target to halve child poverty in reach. It won't take us all the way there, but today the intent is clear and a significant step forward has been taken."
But Conservative leader David Cameron said that 5.3 million of the lowest paid would be worse off after the Budget, following the abolition of the 10% starter rate of income tax.
Hitting the target?
The government's aim was for the number of children living in households living on below 60% of average income to be cut by half to 1.7 million.
The Institute for Fiscal Studies estimates that to hit the target extra spending of £3.4bn would have been needed on benefits and tax credits.
Estimates suggest that despite the changes in the Budget, the 2010 child poverty target will be missed by 450,000.