Families of men who died in the Pike River coal disaster say they are not giving up their fight for compensation.
On Monday, the Government said it would not step in to pay the more than $3 million awarded to the families by the courts in July.
Twenty-nine men died after a series of explosions at the West Coast mine that began on 19 November 2010.
A Royal Commission found the then Department of Labour failed to properly supervise operations, so the families say the Government is liable.
A spokesperson for the Pike River families, Bernie Monk, says the Government should pay compensation to victims' families because the department failed in its duty to protect the mine workers.
Prime Minister John Key says paying what the now-defunct Pike River Coal cannot would set an unwanted precedent.
Mr Monk says the families are considering legal action against the Government and will discuss their options with lawyers in the next few days.
The lawyer for two men who survived the disaster says the Government has clearly breached its legal obligations and is in danger of being sued.
Grant Cameron says the Royal Commission conclusively found the Department of Labour had failed in its statutory duties. He says the Government is in breach of the Bill of Rights Act by not protecting the workers' right to life.