Veterans win first stage of court battle over MOD's LGBT compensation scheme
Two veterans challenging an "unfair and irrational" compensation scheme for former military personnel dismissed under the ban on homosexuality in Britain's Armed Forces, have won the first stage of their legal battle.
Between 1967 and 2000, a ban on homosexuality in the Armed Forces meant those who were suspected of being gay were subjected to interrogation, dismissal and even in some instances, imprisonment.
Steven Stewart and Mark Shephard were forced to resign and received payments of £7,000 and £5,000 respectively under the MOD's LGBT Financial Recognition Scheme, launched in 2024.
But under eligibility rules for a higher payments scheme, the men's claims were rejected because the MOD views their discharges from the Armed Forces as being voluntary in nature.
The pair argue that the scheme's eligibility rules are unfair.
On Wednesday, Mrs Justice Eady ruled that the two veterans can take their claim against the MOD to a full judical review, which will likely take place in January.
The judge said: "I am persuaded this is a matter that warrants further consideration by the court."
Shocking and unpleasant
Speaking to BFBS Forces News, Fighting with Pride CEO Peter Gibson said he was pleased the judge confirmed there was a sufficient case to answer and that the judicial review would go ahead.
However, he described some of the arguments made by lawyers representing the MOD at Wednesday's hearing as "unpleasant," adding: "I think if some of our veteran community were listening to proceedings, they would have been quite shocked at some of those submissions."
Wider implications
Although the judicial review centres on Mr Stewart and Mr Shephard, its outcome could have implications for other veterans who say they were also forced to resign.
Mr Gibson said: "We believe that there are several hundred people who certainly fall into this category.
"We're certainly aware of somewhere in the region of around 70 individuals who've either come via us or are working with a number of the law firms involved in the cases that have been brought."
Forced to resign
The MOD compensation scheme, known as the LGBT Financial Recognition Scheme, offers two payments: a flat rate of £50,000 for those who were dismissed or administratively discharged under the ban, and "impact payments" of up to £20,000 for those affected by it. It is upper scheme, which currently refuses payouts to those forced to resign, that will now be the focus of the judical review.
Isabelle Agerbak, representing Mr Stewart and Mr Shephard, said this means those who were dismissed are eligible for a total of up to £70,000, whereas those who resigned or were forced to quit following an ultimatum are only eligible for a maximum of £20,000.
In written submissions, Ms Agerbak said the scheme is "irrational and unfair".
She said: "It is entirely unclear how and why the defendant arrived at an outcome whereby those who were compelled to resign would be eligible for tens of thousands of pounds less than those with similar experiences, but who were dismissed or discharged."
Amanda Jones, for the MOD, said the claim is "not arguable", adding that the scheme had a "limited total budget" and was set up to "mark and alleviate harm", but did not concede any legal liability.
She said £75 million has been spent on the scheme and that making it available to those who were forced to resign would result in "a very significant additional sum".
There had been benefits for the claimants of resigning rather than being dismissed, she said, including being given a positive employment reference and not having to repay a £4,000 bonus.
The LGBT Financial Recognition Scheme closes to new applications on 12 December 2026. Fighting with Pride is urging anyone who feels they may be entitled to compensation under the scheme to make contact with its team.
:: Additional reporting by Ros Moore.
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