Sir inability to make a decision will bolster dictators around the world and cost thousands of lives, a former Defence Secretary has claimed.
American President Joe Biden's decision to give Kyiv the green light to use their own long-range missiles was widely hoped to be the first in a series of coordinated decisions to give Ukraine greater firepower to defeat Vladimir Putin's forces.
But Sir Keir's pleas to lift restrictions on Storm Shadow missiles, which can hit targets 150 miles away, were last night said to have been rejected by the US.
The Prime Minister was tight-lipped over whether he would follow Mr Biden's decision, insisting he would not give Vladimir Putin any advantage.
America allowed Kyiv to use Army Tactical Missile Systems, (ATACMS), after North Korean troops joined Moscow's soldiers in the conflict.
And the Kremlin immediately responded, accusing the US of "pouring oil on the fire" and risking World War 3.
But former Defence Secretary Grant Shapps told the Daily Express: "There was a time when the UK led the world in the defence of Ukraine, but now - even after the US has finally acted - the British government seems incapable of reaching a decision.
"This government came to power promising they would keep up the pressure on Putin, and yet four months later the Prime Minister has yet to go and show his support for Ukraine in person and worse still, has not authorised our long-range weapons to be used to stop Putin.
"Democracy and freedom isn't something that happens through sound bites, you actually have to be prepared to act, even when the stakes are high.
"It is not too late for this government to start acting on its well-intentioned words, but if they sit on their hands much longer then it could be too late.
"It won't just be brave Ukrainians who will suffer, the entire world order will feel the pain as dictators everywhere feel emboldened to invade their neighbours."
Ukrainian forces could now use the ATACMS to strike Russian and North Korean troops, key pieces of military equipment, ammunition depots, supply lines deep inside Russia and logistics hubs.
This is expected to help them defend their positions in the Kursk region of Russia - which could be crucial for Kyiv in any negotiated peace settlement.
Washington had been concerned that allowing President Zelensky's forces to use the weapons could lead to another escalation in the war.
Asked about the repeated delays in allowing Kyiv to fire British-made missiles deep inside Russia, Sir Keir said: "I'm at the G20 with one message, which is that we must double down on our support for Ukraine.
"Tomorrow is day 1000 of the conflict.
"That's a thousand days of aggression from Russia and a thousand days of sacrifice from Ukraine.
"So that is my clear message here. It's number one on my agenda. Obviously, I'm not going to get into operational details because the only winner, if we were to do that, is Putin and I'm not prepared to do that."
Asked about the threat of increasing military aid leading to World War 3, the Prime Minister said: "We have to support Ukraine in this.
"This is about the sovereignty of Ukraine, but it's also about our own freedoms and that's why for a thousand days, we've stood with Ukraine and will continue to do so."
RUSI Military Sciences Director, Matthew Savill said: "Russian rhetoric has been predictably stark, warning of a 'new spiral of tension' because of US involvement.
"But there is reason to regard this as an attempt to scare off international support, rather than a precursor to a direct confrontation.
"First, Russian officials have spent the past two years already alleging that US support (and that of other international partners for Ukraine) amounts to 'direct involvement' and is 'unacceptable'.
"This, and Ukrainian use of ATACMS and weapons like Storm Shadow in Crimea (already regarded by Russian officials as Russian territory) suggests that conventional strikes have been 'priced in' to the Russian war effort."
Fears are intensifying that Vladimir Putin's forces could launch a major assault, with an estimated 50,000 soldiers, on Ukrainian positions in Kursk.
The Kremlin is believed to want to retake all of the Russian territory seized by Kyiv in August.
Explaining how the long-range missiles could be used to repel the Russian counterattack, Mr Savill said: "Many of the best targets - helicopters and glide-bomb armed aircraft attacking Ukrainian cities and troops in the north or in Kursk have largely moved to airbases outside the range of ATACMS.
"This still leaves plenty of opportunities to strike military headquarters and ammunition or supply locations supporting Russian and North Korean troops, but this would be a reduced impact from when the Ukrainians first requested these weapons."
Donald Trump's victory in the race for the White House has promoted renewed alarm over the level of European support for Kyiv.
Ukrainian officials fear American military aid could ebb away once the President-elect takes office.
Ukraine's President, Volodymyr Zelensky, on Friday accused Germany of appeasement after Mr Scholz spoke to Russian tyrant Vladimir Putin for the first time since December 2022.
He said: "Olaf's call has opened a Pandora's box.
"Now there may be other conversations, other calls.
"This is exactly what Putin has long wanted. It is extremely important for him to weaken his isolation.
"I don't think Putin wants peace at all. But that does not mean he doesn't want to sit down with World leaders... and it benefits him to sit down, talk and not reach an agreement."
Former Defence Secretary Ben Wallace blasted: "Scholz's phone call to the Kremlin was so ineffective that within a few hours Putin launched a massive illegal attack on Ukrainian energy infrastructure.
"In one move he undermined the unified western position, showed weakness and emboldened Russia.
"It as if Putin is laughing at him. He has manipulated the German leader to exactly where he wants him - No Taurus but huge amounts of humiliation. I think Scholz is probably best suited to chairing a sub committee of a local council rather than running a government."
Kremlin spokesman Dmitry Peskov said of the ATACMs decision: "If such a decision has indeed been formulated and communicated to the Kyiv regime, then of course this is a qualitatively new round of escalation of tensions and a qualitatively new situation in terms of the involvement of the United States in this conflict."
Putin-loyalist Vladimir Dzhabarov, the deputy chairman of the Russian parliament's foreign affairs committee warned: "This is a very big step towards the beginning of the Third World War".