The ad, created by Saatchi & Saatchi, has drawn 108 complaints in one week from people who say that it is degrading to women and accusations that it is blasphemous and offensive. However, the company behind Mr Kipling Cakes, Manor Bakeries, said that representatives of both the Catholic and Anglican churches deemed the ad to be in no way offensive.
Other people have complained that a woman giving birth has nothing to do with cake. The Independent Television Commission is investigating.
It is the fifth in Saatchis' "forgiveness" campaign for Mr Kipling, and shows a nativity play with a difference. It starts with a scene that appears to be in a hospital, with a woman in labour called Mary crying out in pain.
However, as the camera draws back, it turns out she is not in a hospital, but is instead on a stage and surrounded by children, and being watched by a horrified audience.
A woman turns to a vicar who is watching the performance while eating a mince pie. She asks in a concerned voice if Mr Kipling has ever directed a nativity play before.
The vicar, who is unfazed by the performance, responds: "No, but he does make exceedingly good cakes."
The spot was written by Joel Bradley and art directed by Phil Clarke. David Lodge from Outsider directed.
A spokesperson for Manor Bakeries, which produces Mr Kipling Cakes, said that the company was aware there had been some criticism and apologised if the humour had offended anyone.
In a statement, the company said: "As well as gaining BACC approval, we also sought the opinion of representatives of the Church of England and Catholic Church in England and Wales in all the regions in which the advertisement is being aired. They, together with a representative sample from church congregations of both denominations, gave assurance that the script was in no way offensive."
Saatchi & Saatchi won the Mr Kipling account in 2001, with a brief to relaunch the brand. In the "forgiveness" series of ads, even the most serious mistakes can be forgiven because his cakes are so good.
In one of the first spots to run, a dog is shown running into a river as a young girl turns to her mother saying "'Mummy, Mr Kipling's drowned Scruffy." Her mother replied: "I know darling, but he does make exceedingly good cakes." It also received complaints.
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