The Ministry of Defence (MoD) has entered talks this week to resolve a legal dispute involving former service members who were forced out because of their sexual orientation. Wes Streeting, the current defence secretary, told reporters that the government prefers an out-of-court solution to the ongoing high-court challenge over the £50,000 compensation scheme introduced in 2024.
Two claimants – Steven Stewart, a 55-year-old former Royal Military Police corporal, and Mark Shephard, a 49-year-old ex-Royal Air Force airman – argue that the rules governing the scheme exclude them despite being compelled to resign. Their case will be heard next week, when a judge decides whether a judicial review can proceed.
High-court hearing and the legal arguments
The claimants contend that the MoD’s eligibility criteria unfairly differentiate between formal dismissals and resignations motivated by the historic ban on LGBT personnel. Because their departures were recorded as resignations, they received only £7,000 and £5,000 respectively under a separate “impact” payment, rather than the full £50,000 “dismissed or discharged” payment. The plaintiffs maintain that this creates a two-tier system that perpetuates the discrimination they endured.
Streeting cautioned that public comments could affect the outcome, noting that the matter “might be subject to judicial review”. Nonetheless, he emphasized the ministry’s willingness to keep “the conversation going” and explore alternatives that avoid further litigation.
Government’s stance and the proposed settlement path
In a statement, the defence secretary explained that the MoD has tried to balance cases with documented dismissals against those lacking formal paperwork. “It’s tricky,” he said, describing the challenge of designing a scheme that recognises both groups. He urged any veterans who have not yet applied to do so, reminding them that £75 million has been earmarked for the programme, of which over £60 million has already been distributed.
Streeting, who is the first openly gay defence secretary, underscored the human cost of the dispute. He noted that several of the affected veterans have already passed away, never receiving the restitution they deserved. While he stopped short of promising a rule change, he affirmed that the MoD will “make sure we get people the compensation that they’re owed”.
Historical context and the broader impact on LGBT service personnel
The ban on gay men and lesbian women serving in the British armed forces was lifted in 2000, after decades of forced exits. Records from that era are sparse, but estimates suggest 200–250 individuals were expelled each year on the basis of sexuality. The 2024 compensation scheme was intended to address that legacy, yet the current case highlights lingering gaps.
Beyond the immediate financial issue, Streeting linked the dispute to ongoing efforts to protect transgender service members. He affirmed a personal commitment to preventing “repeat of those indignities and injustices”, stressing that talent exists across gender identities and that the armed forces must provide equal opportunity.
As the high-court decision approaches, the MoD’s negotiations could set a precedent for how historic discrimination is remedied in the future. Whether the parties reach a settlement before the judge rules will determine if the £50,000 payment framework is adjusted to include those who resigned under pressure, or if the legal precedent will force a broader reform.
