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To make the dumplings, heat the milk to lukewarm. Be careful not to go any hotter or you risk destroying the yeast. Stir in 1 teaspoon of the sugar and the dried yeast and leave in a warm place for 10 minutes until bubbles begin to appear on the surface.
In a large mixing bowl, combine the flour, the remaining sugar, egg, melted butter and the yeast mixture. Stir together with a wooden spoon at first, then using your hands once the dough starts to come together in a ball. Tip out onto a lightly floured work surface and knead for about 5 minutes until the dough is smooth and springy.
Put the dough in a greased bowl, cover with cling film, and leave to rise somewhere warm for 1 hour, or until doubled in size.
While the dough is proving, make the vanilla sauce. Put the milk and vanilla seeds in a saucepan and warm gently. In a separate bowl, whisk together the egg yolks and sugar. Pour the warm milk onto the egg yolk mixture, whisk everything together, then return the mixture to the pan and heat very gently, stirring all the time, until the mixture thickens. This might take up to 20 minutes over a low heat, so to speed things up, you could slake 2 teaspoons of cornflour with a splash of water, stir together, then add it to the sauce. Keep cooking until it has thickened to your liking.
When the dough has almost finished proving, prepare the poaching liquid. Put the milk, sugar and butter in a large saucepan or deep sided frying pan, with a tight-fitting lid and heat until the butter has melted and the sugar is dissolved.
Divide the dough into 8 equal portions and shape each portion into a ball, being careful to tuck the seams in underneath so you have a smooth top to each ball. Pop the dumplings into the poaching liquid, making sure they are all sitting on the base of the pan with a little space in between each dumpling, and put the lid on and don't remove it for the first 25 minutes of cooking time. Keep the heat low under the pan so the dumplings are poaching. After 25 minutes, check the tops of the dumplings feel firm to the touch, cook for a little longer if you need to, then remove the lid and cook for a further 5 minutes or until any remaining liquid has evaporated so that the dumplings develop their characteristic golden bases. Pour the vanilla sauce over the dumplings to serve.