MoD seeks out-of-court resolution over compensation battle with gay veterans

An out-of-court resolution is an agreement reached by the parties before a court decides the case. Here, it could allow the government and the veterans to settle the payment dispute without completing a judicial review. This matters because it might deliver a remedy sooner and avoid a legal ruling on the scheme’s rules.

The Ministry of Defence is holding talks with the aim of finding a way forward that does not require legal action. The dispute concerns Steven Stewart and Mark Shephard, whose departures were recorded as resignations. They argue that pressure linked to their sexuality forced them to leave military service, yet they did not qualify for the £50,000 payment available for formal dismissals or discharges.

Streeting has not promised to change the rules or confirmed that a settlement is being considered. The High Court will decide whether the two veterans can proceed with their judicial review. Talks could resolve their claims, but the article does not state whether an agreement will be reached.

The LGBT financial recognition scheme provides a £50,000 payment to former personnel whose records show they were dismissed or discharged because of their sexuality. It also includes a separate payment recognising the impact of the military’s ban on LGBT personnel. That second route is available to veterans without formal dismissal records, although it pays less in the cases described.

Steven Stewart received £7,000 under the separate payment. Mark Shephard received £5,000. Neither qualified for the £50,000 dismissal or discharge payment because their departures were recorded as resignations, even though both say pressure connected to their sexuality forced them out of service.

The government says the scheme tried to balance documented dismissals with veterans whose departures were not formally recorded. It has allocated £75m, and Streeting said over £60m had already been paid. He urged eligible veterans who have not applied to do so.

Veterans who resigned under pressure receive less because the scheme distinguishes between formal dismissals or discharges and recorded resignations. The £50,000 payment is linked to official records showing that a person was dismissed or discharged. A resignation does not meet that requirement, even if the veteran says military pressure made leaving unavoidable.

Steven Stewart and Mark Shephard are examples. Stewart was a Royal Military Police corporal, while Shephard served in the Royal Air Force. Both say they were targeted because of their sexuality and forced to leave. However, their records describe their departures as resignations. Stewart therefore received £7,000, and Shephard received £5,000, rather than £50,000.

The government says many veterans left without formal records, so it created another route to support them. Critics argue the distinction can preserve an injustice by paying those formally dismissed thousands more. The High Court challenge could test whether that rule is fair or lawful.

The article estimates that about 200–250 military personnel were forced out each year because of their sexuality. Proper records were not kept, so the figure is an estimate rather than a complete official count. The scale shows that the ban affected many careers over a long period, not only the two veterans bringing the legal challenge.

The LGBT financial recognition scheme was given £75m. Wes Streeting said over £60m had already gone to veterans when he spoke to the Guardian. He encouraged people who had not applied to do so, saying more former personnel could still benefit from the remaining money.

The figures also show why accurate eligibility rules matter. Some veterans may have formal dismissal records and qualify for £50,000. Others, whose departures were recorded as resignations, receive smaller payments. The government is discussing whether there is a way forward that avoids further legal action.

If the High Court allows the judicial review to proceed, it could examine whether the government’s LGBT financial recognition rules are lawful and fair. The central issue is whether veterans recorded as resigning should be excluded from the £50,000 payment when they say pressure over their sexuality forced them out. A court examination would put the policy itself under scrutiny.

Steven Stewart and Mark Shephard brought the challenge after receiving smaller payments. Stewart received £7,000 and Shephard £5,000. Neither qualified for the £50,000 payment because their records listed resignations rather than formal dismissals. They argue that this distinction fails to recognise what happened to them.

The court could require the government to reconsider the rules or apply them differently if it finds a legal problem. The case might also encourage an out-of-court settlement. The article does not say what result the judge will reach, and Streeting has not promised a policy change.

Judicial review is a legal process in which a court examines a public authority’s decision, policy, or procedure. It does not usually ask whether judges would have made the same policy choice. Instead, it considers whether the authority acted within its legal powers, followed a fair process, and reached a lawful decision. This is a general legal explanation; the article focuses on the veterans’ challenge.

In this dispute, the court could examine the rule linking the £50,000 payment to formal dismissal or discharge records. Stewart and Shephard say they were forced out because of their sexuality, but their records describe resignations. They received £7,000 and £5,000 instead. Their challenge asks whether that treatment is legally defensible.

If permission is granted, the High Court could require the government to reconsider the policy if it finds a legal flaw. It could also reject the challenge. The judge has not yet decided whether the case may proceed, and the government is discussing an out-of-court resolution.

The article states that gay men and lesbian women were banned from serving in the British armed forces until 2000. It does not explain the government’s formal reason for imposing that ban. What it does establish is that personnel were persecuted because of their sexuality and that many were forced to leave military service. That history forms the basis of today’s compensation claims.

The estimated impact was substantial. About 200–250 personnel were thrown out each year because of their sexuality, although proper records were not held. Some departures were recorded as formal dismissals or discharges. Others were recorded as resignations, even when veterans say pressure left them no real choice.

The compensation scheme was created to recognise that past treatment. It offers £50,000 for some formal dismissals or discharges and smaller payments through another route. Stewart and Shephard argue the distinction continues the unfairness. Their High Court challenge could determine whether the rules adequately address that history.