Poverty in the United Kingdom is set to spike due to declining incomes, according to a report from the Institute for Fiscal Studies (IFS), a London-based is an economic research institute.

Currently, the IFS estimates that in 2010, 2.5 million children and 2.1 million working-age parents were living in absolute poverty, which is defined as being below 60 percent of the median income, adjusted for inflation.

Within two years time, 600,000 more British children will slip into absolute poverty, pushing the total number to more than 3.1 million, the IFS projects. By that time, 2.5 million working-age parents and 4 million working-age childless adults will also find themselves in such dire straits.

The IFS also offers up a grim warning to middle-income Britons, who will feel a significant squeeze on their earnings and lifestyles.

Between 2010 and 2013, median income is expected to fall by 7 percent, the biggest three-year drop in 35 years.

“This would be the largest three-year fall in median income since 1974-1977,” said Robert Joyce IFS report co-author

However, IFS believes that after peaking in 2013, child poverty will drop by 100,000 to 3 million by 2015 due to the planned introduction the University Credit scheme.

Similarly, following the 2012 bottom, middle-income people will see their incomes gradually climbing, although 2015 income levels will still likely fall below their 2009 figures.

Prospects for the poorest of the poor will remain bleak. IFS projects that by 2020, 4.7 million working-age adults without children will be living in absolute poverty, a sharp 1.6 million increase from 2009.

Moreover, the percent of UK children living in absolute poverty is expected to reach 23 percent in 2020 – a far cry from the 5 percent target set by the government in 2010.

In response to the IFS’ grim numbers, Anne Marie Carrie, the chief executive of Barnardo’s, the UK children’s charity, told BBC: The projected figures for child poverty revealed today are a tragedy. This isn't just about statistics as every day thousands of families are being forced into making choices between heating or eating.

Similarly, Alison Garnham, chief executive of Child Poverty Action Group, said: [Government] ministers seem to be in denial that, under current policies, their legacy threatens to be the worst poverty record of any government for a generation. They risk damaging childhoods and children's life chances, as well as our national economic wellbeing from wasted potential and social costs spiral. It would be a catastrophic failure in public policy and political leadership.

According to BBC, the current poverty line for single adult, no children is £165 per week ($258); couple without children: £248 per week ($388); single parent with one child: £215 per week ($336); single parent with two children: £264 per week ($413); single parent with three children: £314 per week ($491); couple with one child: £297 per week ($464); couple with two children: £347 per week ($542); and couple with three children: £396 per week ($619).