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Taxpayers will pay around £180,000 towards legal costs linked to the long-running campaign involving women born in the 1950s who say they were not properly told their state pension age was rising. The payment follows months of legal pressure from the Women Against State Pension Inequality (WASPI) group, which has been challenging the Government's refusal to offer compensation. The campaign represents an estimated 3.6 million women affected by changes that raised their retirement age to 66.

The Government had previously rejected paying compensation, despite the Parliamentary and Health Service Ombudsman ruling last year that the Department for Work and Pensions (DWP) had committed "maladministration" when communicating the pension changes. The Ombudsman recommended awards of £1,000 to £2,950, but ministers at the time said most women already knew about the increase.

WASPI launched a judicial review after that rejection, arguing the decision was flawed.

They secured a cost-capping order limiting their own exposure to £60,000, but creating the possibility of a much larger bill for the taxpayer if the Government withdrew or lost.

That moment has now come. In November, Work and Pensions Secretary Pat McFadden confirmed the previous decision would be "retaken" after it emerged a key 2007 DWP document had not been seen by his predecessor, Liz Kendall, when she rejected compensation last December.

WASPI argued that the document directly related to how many women would have received earlier pension-age letters.

WASPI has now withdrawn the judicial review after agreeing on a detailed set of conditions with the Government about how the new decision will be carried out.

The taxpayer will pay over half of WASPI's legal costs, totalling £180,000, due within 21 days, The Telegraph reported.

According to the group, this agreement ensures the new decision will be examined "quickly and properly" and makes clear that ministers must look at all relevant evidence, not just the missing research.

The Government has also committed to finish its reconsideration within 12 weeks, unless there is "very good reason" for a delay, and any delay could be challenged in court.

WASPI chair Angela Madden said the group had "held its nerve" and insisted the Government had effectively backed down at the "steps of the court".

She said: "By failing to take the decision in light of the proper information, they have cost taxpayers money without actually delivering justice for WASPI women.

"Today's agreement on speedy and thorough reconsideration is welcome. But the Government should be in no doubt that WASPI stands ready to return to court if it yet again fails to do the right thing."

Ms Madden also thanked supporters who donated to help fund the legal challenge, saying the campaign now has the resources to go back to court immediately if future errors are made.

Pensions expert Sir Steve Webb, a former minister, warned that the legal-cost payment should not be seen as a sign that compensation will definitely follow.

He said the costs and the potential payout sat on "completely different levels", and that a decision on financial redress will depend entirely on the outcome of the reconsideration now under way.

A DWP spokesperson rejected suggestions that ministers had "backed down", saying that WASPI had withdrawn its legal action after the Government committed to retaking the decision.

The spokesperson said: "The Waspi campaigners have agreed to withdraw their Judicial Review following our commitment last month to retake the decision. We will retake the decision as soon as possible."