Armed Forces Bill

Lord Davies of Brixton Excerpts

Committee stage
Wednesday 2nd September 2026 Lords Chamber

[Baroness Smith of Newnham (LD)]

My Lords, I gave way to the noble Baroness, Lady Goldie, precisely because she had her name first on a set of amendments in this group. I am delighted that I did so because in the previous Parliament, when she sat on the Government Benches and the noble Lord, Lord Coaker, now the Minister, sat on the Opposition Benches and I still sat in this corner, I kept encouraging the Government to expand the Armed Forces covenant—not only in the way the previous Government sought to do, but to bring it within the purview of the Government and make it a duty on them. At Second Reading, I welcomed the provisions of the Bill. I am delighted that the previously diffident former Minister, now sitting on the Opposition Benches and speaking for His Majesty’s Loyal Opposition, sees how important it is to expand the Armed Forces covenant.

The amendments brought forward by the noble Baroness, Lady Goldie, and the noble Earl, Lord Minto, are valuable. Quite whether we need the level of detail in them, or how we go about them, needs to be thought about. I am sure the Minister will have all sorts of reasons why these specific amendments might not be the best way of doing it. I hope that, in his response, he can explain whether the noble Baroness is right that currently, HMRC, or the proposed defence housing service, do not come under the requirement to be under a duty to the Armed Forces covenant. If they are not under that duty, I would be happy to work with the noble Baroness to bring forward amendments on Report. Clearly, we want to make sure that the duty is on the Government and public authorities more generally. I therefore very much welcome the thrust of this suite of amendments.

I also cosigned the amendments in the name of the noble Baroness, Lady Fraser of Craigmaddie, very much for the reasons she articulated. The role of the Royal Fleet Auxiliary is crucial in our defence. RFA “Lyme Bay” is—or has been—in the Middle East, responding to a crisis. It serves our security and defence very significantly. As the noble Baroness pointed out, those on the Royal Fleet Auxiliary are not civil servants in a traditional sense. They may be civilians, but the service they are giving is the sort that would seem to make coming under the purview of the Armed Forces covenant appropriate. If His Majesty’s Government disagree with that idea, could the Minister explain why and suggest ways in which it can be ensured that civilians serving on the Royal Fleet Auxiliary are not suffering any detriment, which is exactly what the Armed Forces covenant is intended to countermount?

[Lord Davies of Brixton (Lab)]

I welcome this opportunity to discuss the scope of the Armed Forces covenant. I thank the noble Baronesses for the speeches they have made. I found what they said convincing, although I look forward to the response from my noble friend the Minister and expect I will find his reply even more convincing.

I want to take the opportunity to raise a practical example of where I hope the provisions in Clause 2, with or without the amendment, might make a difference. I suspect it will come as no surprise to the Committee that it relates to the role of the covenant in relation to the Armed Forces Pension Scheme. I should mention here that, in the past, I have been a paid consultant to the Forces Pension Society, and I thank the society for providing me with a briefing on the matters I am going to raise. I should add that it was when working with the society that I became aware of the practical significance that members of the Armed Forces place on the covenant. It is significant not just as some general principle but as applying to practical situations.

By way of background, the Armed Forces Pension Scheme provides a world-class pension, and it is an important bond in the relationship between those who govern and those who serve—otherwise known as the Armed Forces covenant. It is designed to incentivise service, maximise the human element of defence’s operational effectiveness, facilitate servicepeople’s transition to civilian employment and provide for a dignified retirement. That is why I have been concerned by the recent reports of veterans being told that they must repay substantial sums of pension that they have received because those pensions were calculated incorrectly at some point in the past. The issue has received considerable coverage on the BBC, and in the Times, the Telegraph, the Express and the it Paper.

Please bear with me in explaining the problem, because the scheme’s administrative arrangements are a little complicated. Defence Business Services is responsible for the scheme through Veterans UK. It has contracted in turn Sopra Steria to deliver the pensions. Sopra Steria has in turn sub-subcontracted Equiniti as its paymaster, and the system is overseen by the Armed Forces Pension Board, supporting the Secretary of State for Defence as the scheme manager. There are clear doubts about how Defence Business Services, Veterans UK, Sopra Steria and Equiniti should be held to account. There are other problems, but I want to highlight the disappointing pattern of overpayments in areas such as pension sharing on divorce, early departure payments, guaranteed minimum pensions and national insurance modifications. Between 1,000 and 2,000 members have received such overpayments, which indicates a lack of rigour in calculation, inadequate training, a lack of oversight and paucity of quality assurance.

I will give the Committee two examples. I will not name the individuals involved, but the circumstances illustrate the problem. One is a 72 year-old veteran who served in the Army for 31 years, reaching the rank of warrant officer class 1, but who faces having to repay a pension overpayment of £37,500. This arose from four separate errors in the calculation of his pension. The second example is a 70 year-old former RAF flight lieutenant who was overpaid by £32,000. He queried the increase when he first received it but was told it was correct. Years later, he has now been told that there was indeed an error, and it is he, not the administrator, who is liable for repayment. It is worth noting that there are many cases with higher overpayments, but these cases illustrate the complex nature of the problems members face.