Gordon Brown said he was disappointed with 33 of his own ministers, including Jacqui Smith, the Home Secretary, for voting to continue with the "John Lewis List" of MPs' allowances for furnishing their second homes.
But Mr Brown was criticised for a lack of leadership by David Cameron, the Conservative leader, who accused him of arranging a Commons "fix" by using government whips to ensure MPs voted for a separate motion on pay restraint while letting them have their way over their expenses.
Touring an NHS hospital in the North-east, Mr Brown said: "I was not happy about what happened. I was disappointed. We voted to keep the pay of MPs down and now we must look at the issue of expenses and accountability again."
But the Tories are convinced there was a secret trade-off to allow the reform of expenses to be defeated in return for ensuring that a motion restricting the MPs' pay rise to 2.25 per cent, in line with government policy on public-sector pay, would be passed. Mr Cameron said: "There is an urgent need for reform which is why I led my Shadow Cabinet to vote against the John Lewis List.
"Gordon Brown also had a real opportunity to show leadership and vote for change, but once again he bottled it. On the one hand he expresses disappointment at last night's result, yet he didn't even turn up for the vote. His excuse that he was in a meeting is utterly feeble – particularly when his whips were herding people to wreck the reforms."
Mr Brown's two parliamentary aides, Angela Smith and Ian Austin, voted for the continuation of the allowances for second homes alongside 31 other ministers. It led to furious scenes in the lobbies as senior Tories criticised Mr Brown's aides for failing to vote for reform of MPs' expenses. Mr Austin is alleged to have told George Osborne, the shadow Chancellor to "f-off, you toff".
The votes of Mr Brown's two parliamentary private secretaries against reform were seen as a signal that Mr Brown was content to allow Labour MPs to defy the call for reform of MPs' allowances by Harriet Harman, the Leader of the House and deputy leader of the Labour Party.
Mr Brown's senior Downing Street officials denied his failure to vote was an act of cowardice. "It was clear that the option he would have backed was going to be defeated. It was his last working day in London until next Thursday. There was a lot of government business and the decision was taken not to pull him out of meetings given that the vote would be lost."
Another minister to vote against reform, the Culture Secretary, Andy Burnham, defended his decision, saying: "I do not claim the current system is perfect, but I believe those who voted like me did so for entirely justifiable reasons."
The MPs voted 172 to 144 to keep their £23,000-a-year additional costs allowance and retain the list of items they are allowed to buy for their second homes. They also threw out attempts to impose an independent audit on their claims.
Sir Christopher Kelly, the chairman of the independent Committee for Standards in Public Life, said he would continue to carry out checks on MPs' expenses. He described the result as baffling, and said it could cause "even greater distrust of the political class".
Nick Clegg, the Liberal Democrat leader, said his party would follow the recommendation of the members estimates committee to spot-check MPs' expenses.