The government will not compensate women born in the 1950s who were affected by the Department for Work and Pensions not communicating an increase in state pension age earlier, work and pensions secretary Liz Kendall has said. Campaigners are now calling on MPs to force a debate on the issue.

The statement made in the House of Commons confirms that the DWP will not compensate women who saw their state pension age increased and say they were not adequately informed. It comes after the Parliamentary and Health Service Ombudsman had found maladministration by the DWP, saying it should have sent a letter 28 months sooner than it did, and recommended compensation for affected women of £1,000 to £2,950 each.

Some women said they thought they were eligible to get their pension aged 60 and gave up work or reduced their hours in anticipation of this, only to find out that they had to wait several more years.

In its response to the PHSO report, the DWP accepted the finding of the 28-month delay and Kendall apologised for the maladministration. 

However, she denied that women did not know the state pension age was rising. The DWP cites a survey which found the majority of older working women knew that the state pension age was increasing, with Kendall saying it would therefore be “unfair to taxpayers” to pay flat rate compensation to all 3.5m women costing up to £10.5bn, while assessing each affected woman’s claim individually “would take thousands of staff years to process”. 

In addition, the MP for Leicester West claimed sending a letter earlier would not have had much impact: “Research given to the ombudsman shows only around a quarter of people who are sent unsolicited letters actually remember receiving and reading them. So we cannot accept that – in the great majority of cases – sending a letter earlier would have affected whether women knew their state pension age was rising or would have increased their opportunities to make informed decisions.” 

Kendall added that she wants her department to learn all the lessons from the issue to avoid future maladministration. The DWP will therefore work with the ombudsman to develop “a detailed action plan out of the report”. 

She said the government was “committed to setting clear and sufficient notice of any changes in the state pension age so people can properly plan for their retirement” and has tasked her officials “to develop a strategy for effective, timely and modern communication on the state pension that uses the most up to date methods”. 

In September, pensions minister Emma Reynolds, who also sits in the Treasury, already said that women whose state pension age has increased and who had given up work too early should return to work or use the welfare system. 

Confirmation that the DWP will not compensate 1950s-born women is "unprecedented” according to campaigners.

Angela Madden, who chairs campaign group Women Against State Pension Inequality, 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 added: “The idea that an ‘action plan’ to avoid such mistakes in future should be the result of a six-year ombudsman’s investigation is an insult both to the women and to the PHSO process.”

Madden argued that the majority of MPs back Waspi’s calls for fair compensation, saying all options remained on the table and calling on politicians to force a debate.

“Parliament must now seek an alternative mechanism to force this issue onto the order paper so justice can be done,” she said.

In March last year, PHSO itself took the “rare but necessary step” of asking MPs to intervene by laying the report before parliament, fearing the DWP would put up much resistance against its findings.