The bedroom tax is helping to reduce child deprivation, ministers have claimed.

A new draft child poverty strategy for 2014 to 2017, which was launched by work and pensions secretary Iain Duncan Smith and education minister David Laws yesterday, lists the ‘removal of the spare room subsidy’ as one of the measures that is helping to improve the living standards of low-income families.

The document, which is out for consultation, says: ‘The removal of the spare room subsidy provides an incentive to tenants with spare rooms to move to smaller homes, while the introduction of Home Swap Direct is helping tenants with too many and too few rooms to help each other.’

Matthew Reed, chief executive of the Children’s Society, said the inclusion of the bedroom tax in the strategy was ‘alarming’.

‘We know from our direct work with families that this will only make children poorer, for example by displacing more families,’ he said.

Yesterday charities condemned the government for putting on hold plans to overhaul the way child poverty is measured.

Reports suggest the Conservatives and Liberal Democrats had reached a deal on introducing new measurements for child poverty – taking factors such as education and decent homes into account – but these were blocked by the Treasury.

The strategy lists existing policies designed to reduce child deprivation and restates the government’s commitment to ending child poverty by 2020.

Alison Garnham, chief executive of Child Poverty Action Group, said: ‘After a long wait, we’re disappointed to see a list that contains little new, or likely to make a dent in the numbers of children growing up in poverty.’

Mr Duncan Smith said in an article for the Guardian yesterday: ‘This is such an important issue – it is vitally important that we take the time to get it right.’