It is impossible for the factories to move from losses of £20,000 or more per disabled worker to full financial viability in one year without a higher level of government help.
The Government is offering £3,200 per disabled employee in the first year of privatisation, or £6,400 overall over three years.
A letter from Mr Duncan Smith to Mr Brown stated that "no additional transitional funding will be available" and that "any additional financial support over and above that already made available will dilute the focus on people building sustainable businesses, at least in the short term".
But in a statement, the MPs said: "The minister's reply is not good enough. We did not ask for long-term endless support or for large sums of money in aid but we know that keeping the staff on at current levels will require more cash to secure viability.
"We will not allow an inflexible letter from the Work and Pensions Secretary to close the door on financial support that could secure the jobs and workload of two factories."