The government has been told to compensate 85,000 people who have lost all or part of their company pensions.
The parliamentary ombudsman, Ann Abraham, made the ruling after finding the Department for Work and Pensions (DWP) guilty of maladministration.
She said official guidance on company pension schemes had been “inaccurate, incomplete, unclear and inconsistent”.
The government rejected the report, saying it could not be held responsible for corporate pension schemes.
Much of the criticism in the report is directed at government information leaflets which, it said, gave a misleading impression of the security of company pension schemes.
Work and pensions secretary John Hutton told the BBC there was no evidence that these leaflets were inaccurate or incomplete.
He added that the ombudsman had “not established that people relied exclusively, or alone, or heavily on the leaflets we did produce as the basis for their financial decisions”.
The ombudsman’s report is non-binding and the government cannot be compelled to act on its recommendations.
But several trade unions said they would now proceed with legal action against the government to enforce their members’ claims for compensation.
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