Campaigners called the government’s decision not to compensate the millions of women affected by the way changes to the state pension age were communicated “bizarre and totally unjustified”.
Work and pensions secretary Liz Kendall rejected calls for the individuals to be awarded between £1,000 and £2,950 each, adding the government does not believe it to be a fair use of taxpayers’ money.
The Labour government is also facing a barrage of criticism from MPs over the decision, some of which is coming from within its own party.
Compensation to up to 3.8 million women affected by the changes could have cost the government £10.5 billion, Ms Kendall said.
In a statement on Tuesday, she said: “These two facts: that most women knew the state pension age was increasing and that letters aren’t as significant as the Ombudsman says, as well as other reasons, have informed our conclusion that there should be no scheme of financial compensation to 1950s-born women, in response to the Ombudsman’s report.”
Angela Madden, chairwoman of Women Against State Pension Inequality (Waspi), criticised the decision, adding it is something that “would make the likes of Boris Johnson and Donald Trump blush”.
“The government has today made an unprecedented political choice to ignore the clear recommendations of an independent watchdog which ordered ministers urgently to compensate Waspi women nine months ago,” she said.
“This is a bizarre and totally unjustified move which will leave everyone asking what the point of an ombudsman is if ministers can simply ignore their decisions.”
She described an action plan to avoid such mistakes in future as “an insult both to the women” and to the investigation previously carried out by the Parliamentary and Health Service Ombudsman (PSHO) into how changes to the state pension age were communicated.
She added: “An overwhelming majority of MPs back Waspi’s calls for fair compensation and all options remain on the table. Parliament must now seek an alternative mechanism to force this issue onto the order paper so justice can be done.”
Waspi campaign director Jane Cowley told Times Radio she is “absolutely incensed” by the government’s decision. She said the organisation will be calling on the “massive amount” of support it has in Parliament.
Caroline Abrahams, charity director at Age UK, voiced similar concerns, adding it will only add to the “sense of injustice”.
“Everyone understands that the public finances are under acute pressure, but the government should not rub salt in the wounds of those impacted by suggesting there is no case for compensation,” she said in a statement.
“The fact that many of the women affected will also be coping with the loss of their winter fuel payment this year will intensify their sense of injustice.”
Unison head of equality Josie Irwin said the decision “is a cruel blow to a generation of women”, adding: “The government must find a way to resolve this desperately unfair situation. Refusing to pay compensation is not the answer.”
The government said it has accepted the Ombudsman’s finding of maladministration and has apologised for the 28-month delay in writing to 1950s-born women.
But it said evidence showed only one in four people remember receiving and reading letters that they were not expecting and that the great majority of 1950s-born women did know that the state pension age was changing.
There were shouts of “shame” when Ms Kendall made the announcement in the Commons.
Speaking later to journalists, Ms Kendall said “real and concrete actions” were coming out of the report.
She said: “We want to work with the Ombudsman to develop a detailed action plan to make sure those sorts of delays never happen again.
“We have committed to ensuring that there is sufficient notice about any changes to the state pension age so people can properly plan for their retirement.”
She instead pledged the government would protect the pensions “triple lock”, drive down NHS waiting lists and deliver “the jobs, homes and opportunities your families need to build a better life”.
Independent MP Rebecca Long Bailey, who co-chairs the all-party parliamentary group (APPG) on State Pension Inequality for Women, said the government’s apology was “not enough” for Waspi women.
Liberal Democrat work and pensions spokesman Steve Darling said: “Today is a day of shame for the government.
“The new government has turned its back on millions of pension-age women who were wronged through no fault of their own, ignoring the independent Ombudsman’s recommendations, and that is frankly disgraceful.”
Earlier, Sir Keir Starmer said he understood the concerns of the Waspi women but the government had to protect the taxpayer.