In May 1973 the Defence Service Homes Act 1918 was amended to include as qualifying service, service in the Forces in peacetime. The new service qualifications applied only to members of the Forces who served on or after 7 December 1972. In the case of national servicemen, the period of service was that for which the member was deemed to be engaged to serve.
The Government's decision to extend the benefits of the Scheme to members of the peacetime Forces was part of its policy to abolish conscription into the armed Forces and to fulfil its aim of introducing conditions of service that would attract and retain regular servicemen in peacetime.
The Government regarded the measure as an essential one in establishing an all volunteer force. It decided, as a matter of equity, that eligibility should also be extended to national servicemen serving on 7 December 1972, who voluntarily chose to complete the period of service for which they were engaged to serve. The retention of those national servicemen who chose to remain was seen as valuable in the transition from a partly conscripted army to an all volunteer force.