One in three children in Britain lives in poverty (households whose income was less than 50 % average earnings). Low income is associated with poor nutrition at all stages of life, from lower rates of breast-feeding to higher intakes of saturated fatty acids and lower intakes of antioxidant nutrients. Moreover, there is increasing evidence that poor nutrition in childhood is associated with both short-term and long-term adverse consequences such as poorer immune status, higher caries rates and poorer cognitive function and learning ability. These problems arise primarily because parents do not have enough money to spend on food, not because money is being spent unwisely. Policy options to improve the dietary health of poor children include: giving more money to the parents by increasing Income Support (social security) payments, providing food stamps or vouchers, and using food budget standards to inform the levels of income needed to purchase an adequate diet; feeding children directly at school (not only at lunchtime but also at breakfast or homework clubs), by providing free fruit at school, and by increasing entitlement to free food amongst children living in households with low incomes; improving access to a healthy and affordable diet by first identifying ‘food deserts’ and then considering with retailers and local planners how best to provide food in an economical and sustainable way. The value of using food budget standards is illustrated with data relating expenditure on food to growth in children from ‘at-risk’ families (on low income, overcrowded, headed by a lone parent or with four or more children under 16 years of age) living in a poor area in London. Lower levels of expenditure are strongly associated with poorer growth and health, independent of factors such as birth weight, mother’s height, or risk score. The present paper provides evidence that supports the need to review Government legislation in light of nutrition-related inequalities in the health of children.