The Joint Committee on Human Rights report said the bill, which will enshrine the government’s target to eradicate child poverty by 2020 in legislation, breaches human rights by targeting only children "in qualifying households".
The bill does not define these households but the committee said they were likely to be based on postcodes, which would exclude children seeking asylum, Gypsy, Roma and Traveller children, as well as those living in temporary accommodation.
The government has previously justified this method by claiming it would be too costly and impractical to survey children outside of qualifying households.
But the report warned: "It is highly likely that, as presently drafted, the bill will give rise to a serious risk of future breaches of Article 14 (of the European Convention of Human Rights) because policy-makers will prioritise raising the income of children only in qualifying households, in a discriminatory way."
The committee also said children should be consulted directly on the bill through the relevant children’s commissioners.
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