More than 1,000 retired military personnel are being pursued for substantial debts after the Ministry of Defence discovered systematic errors in pension calculations spanning years. The majority of those affected—335 veterans—were overpaid a combined £5.1 million due to incorrect National Insurance adjustments, with some individuals facing demands exceeding £30,000.
Ray Lawton, a 70-year-old Royal Artillery veteran who served 16 years, received a letter in July demanding repayment of £8,000. Within days, his monthly military pension was reduced from £550 to £365.
"I haven't got £8,000 to pay out," Lawton told the BBC. "I've got a little bit put aside but nowhere near that much."
"I've trusted the army all my life even when I left and I trusted my pension would be right. Then this letter comes and it's just blown it all out."
The demand letters were issued by Equiniti, the company administering the pension scheme on behalf of the MoD, citing system errors that resulted in years of overpayments. Hundreds of veterans across the United Kingdom have contacted the BBC after receiving similar correspondence seeking repayment of funds they were unaware they owed.
Andrew Thorburn, who completed 36 years of service in the Royal Navy, faces a particularly severe situation. He has been notified that he owes £26,438, resulting in a monthly pension reduction of approximately £650.
"I think it's despicable that they are now saying 'yes, we've made this mistake however you're going to pay for it'. How can I forgive the government for that?"He described the financial impact as
"absolutely devastating and it's still ongoing."
The MoD has acknowledged errors relating to National Insurance adjustments, Pension Sharing Orders, Early Departure Payments, and State Pension Age calculations. According to the department's figures, of the 335 veterans affected by National Insurance errors, approximately one-third have settled their debts in full, while 52 have negotiated repayment arrangements. To date, £304,000 of the £5.1 million owed has been recovered.
The Forces Pension Society, a not-for-profit organisation supporting military retirees, has become aware of numerous cases involving overpayments in the tens of thousands of pounds, with a small number of veterans receiving demands for six-figure sums. According to the Forces Pension Society's August 2026 progress report, the organisation is actively campaigning on the issue after becoming aware of several hundred veterans who had received Equiniti letters titled "Overpayment of Armed Forces Pension."
What options do affected veterans have?
Equiniti has informed affected members that they may repay the debt as a lump sum, over the same period as the error occurred, or through a debt-management arrangement for those facing financial hardship. However, the Forces Pension Society's guidance issued on 23 August 2026 advises veterans to challenge repayment demands through the Armed Forces Pension Scheme's Internal Dispute Resolution Procedure and to request detailed breakdowns of how Equiniti calculated the overpayments.
Lawton does not believe the financial burden should fall on veterans.
"I think they should take responsibility for it because it's not my fault."He has expressed willingness to accept a reduction in his pension to the correct level but argues that Equiniti, as the administrator responsible for the error, should absorb the cost of the overpayment.
RAF veteran Barrie Goodwin contacted Equiniti six years ago after noticing he was receiving a higher payment than anticipated. He was informed the increase resulted from reaching state pension age. He has since been told he was overpaid £32,188 and must repay it.
"I checked, was told it was all correct and now have to repay it,"Goodwin said.
"I'm already cutting back on luxuries. I was helping one of my grandchildren through nursey - that's had to change. If the debt isn't waived, I will really struggle."
Who is responsible for the errors?
The MoD has stated it has a responsibility to recover taxpayer funds and will pursue repayment in what it describes as a sensitive and proportionate manner. An MoD spokesperson told the BBC that the department recognises that errors to pension payments
"may cause uncertainty"and is contacting veterans while
"providing support for anyone who requires it."
The spokesperson added:
"Where payments have been made in genuine error, we have a responsibility to recover taxpayer funds and will always seek to do so in a sensitive and proportionate way."
However, former Conservative defence secretary Penny Mordaunt has challenged this approach.
"While public bodies have a duty to recoup such costs if it makes financial sense to do so, no such assessment has been made in these cases. There is a compelling case in many instances for the debt to be wiped."
According to reporting from July 2026, the MoD believed the error was rooted in mistakes in the Armed Forces' two final-salary schemes and described it as an incorrect application of national insurance modification rules. These two schemes provide guaranteed lifetime incomes for approximately 432,000 retired troops, which underscores the potential scale of the problem.
Equiniti has stated it cannot discuss individual cases but acknowledged the concern caused to pensioners. A company spokesperson said it was not responsible for the decision to recoup taxpayers' money but noted that
"administration of a scheme of this scale involves multiple organisations, systems and processes over many years."
Technology company Sopra Steria has managed the veterans' pension scheme since 2023 and subcontracted administration to Equiniti. A Sopra Steria spokesperson told the BBC that
"errors that led to incorrect pension payments originated over a decade before Sopra Steria took over the contract."The company stated it is
"working closely with the MoD and Equiniti to ensure robust safeguards are in place for the long term."
The Forces Pension Society has indicated that there appear to be significant contractual and quality-assurance failings involving the MoD, Sopra Steria, and Equiniti, raising questions about oversight and accountability across the administration chain.
What should affected veterans do next?
Veterans who receive an overpayment letter should verify its authenticity and request detailed information from Equiniti regarding how the debt has been calculated. The Forces Pension Society advises using the Internal Dispute Resolution Procedure to challenge repayment demands and recommends contacting an MP for additional support. Government guidance for complaints about the Armed Forces Pension Scheme remains available through Veterans UK and the MoD complaints process.
Key Facts
- More than 1,000 retired service personnel are being pursued for pension overpayment debts, with 335 affected by National Insurance calculation errors totalling £5.1 million
- Individual demands range from thousands to six figures, with some veterans experiencing monthly pension cuts of £650 or more
- Of the £5.1 million owed, £304,000 has been recovered; one-third of affected veterans have paid in full and 52 have agreed repayment plans
- The errors originated in the Armed Forces' two final-salary pension schemes, which cover approximately 432,000 retired troops
- Veterans can challenge repayment demands through the Internal Dispute Resolution Procedure and request detailed calculation breakdowns from Equiniti
