Does digital technology have the potential to address the 'legal gap'?

Despite the barriers to entry for digital solutions in the SME space, Chris Gorst believe technology could transform access to justice in the UK

For many individuals and small businesses legal services can seem inaccessible and reserved for those with the time and money to navigate a complex legal system. It is something to engage with only when there is no alternative.

In fact, research from Nesta Challenges has found that six in ten people in England and Wales think the legal system is ‘not set up for ordinary people’.

Other research suggests that more than half of UK adults experience a legal issue over a three-year time period and increasingly so as we get older.

However, there is a widespread belief among individuals in England and Wales that technology could be part of the solution to the ‘legal gap’, with six in 10 saying they think technology could lead to better services to help people resolve their legal problems.

Technology is not a panacea, but in many other areas of our lives it has transformed the choice, convenience and quality available to us, as well as enabling people to make use of services they might not have previously found accessible.

I believe technology could do the same for legal services and change how legal services are experienced. But so far digital solutions have been very slow to emerge in the consumer and SME space.

People are already very comfortable using technology in other areas such as banking, mobility, and interacting with government services.

People can already envisage the possibilities; when asked what they thought the biggest benefits to using a digital service for legal advice would be, people identified having a fixed price upfront, being able to understand their rights and having access to cheaper legal advice and information.

The principle that accessing legal services should be easier is uncontroversial and the idea that technology could help in this goal is widely acknowledged. So why are technology-enabled solutions proving so slow to gain traction in legal services?

Having developed over centuries in the UK, the legal services market is characterised by several built-in barriers that prevent the sector from taking full advantage of twenty-first century technology.

These include a deeply ingrained legal culture which affects how both lawyers and customers think about who can solve their legal problems.

It favours conventional legal firms and their way of working, making it difficult for direct digital technology solutions to build trust, and raising potential concerns about how to assure the quality of digital technology solutions provided by a new generation of non-regulated companies.

Some firms will naturally have concerns about the potential disruption to business models from digital service innovations.

We see innovation as an opportunity for firms to reach new customers, grow the overall market, and to focus on higher value work – as well as providing greater access to legal support for the many people who do not currently have this.

There is a fragmented legal services market serving individuals and small businesses, which leaves many smaller firms lacking the resources and incentives to invest in the best new technologies. 

The not-for-profit legal advice sector also lacks the resources to invest in new technologies to pursue its mission to ensure access to justice for all.

Funding and private investment is harder to come by for consumer and SME-facing legal tech than it is in the more established commercial legal tech sector, perhaps reflecting the greater challenges in developing financially sustainable and attractive business models for these solutions.

A lack of access to quality data to train Artificial Intelligence-based solutions also makes it very difficult to develop good quality tools. 

To help address these barriers, Nesta Challenges is working in partnership with the Solicitors Regulation Authority (SRA) to launch the Legal Access Challenge – a new challenge prize which aims to help more people access legal services through new technology.

We are hoping to receive applications from a diverse mix of entities, including legal tech start-ups, solicitors and law firms, alternative legal providers, advice sector organisations and teams based at law schools.

The SRA has already implemented regulations that don’t distinguish where legal advice is assisted by technology, so regulation is not seen a barrier to these solutions emerging.

However, the Challenge provides an important opportunity for the SRA to explore any implications for its regulatory framework as the solutions become adopted more widely in the regulated market.

We want to see digital solutions that directly support individuals and small businesses to access legal services conveniently and affordably.

We believe well-designed digital tools could help people to engage with and resolve their legal issues earlier, providing tailored support instantly and in everyday language, improving understanding of processes and enabling people to take more control over understanding and resolving their legal problems.

This is not about using technology to paper over cracks – or sometimes chasms – in legal service provision. 

For more complex situations, and for vulnerable users, the balance between technology and human expertise will of course be different from simpler cases and more confident users.

The Challenge will explore how technology can safely help, in what circumstances it is most appropriate, and how it can best integrate with human expertise. However, we are also pragmatic and don’t expect the Challenge to deliver change overnight. 

We know that investment in technology-driven solutions to tackle the problem of unmet legal need will take time, and may require policy and regulatory changes, a greater flow of entrepreneurial talent into the market, more private investment, and more partnerships and enterprise deals between traditional firms and technology start-ups. 

But we are committed to long-term change – including the development of a community of people and organisations with a shared interest in the use of technology in this space – and believe the Legal Access Challenge is an important stepping stone on the path to a legal system that is able to meet the needs of the majority.

Chris Gorst is head of better markets at Nesta Challenges