The UK government is investing a further £4m to boost digital transformation in the legal sector as it strives to become the go-to market for digital legal innovation. 

The new investment from the UK Ministry of Justice (MoJ) will deliver the second phase of the Lawtech UK programme, which was launched in 2019 when the MoJ invested an initial £2m to kickstart the initiative.  

Lawtech UK, which up until now has been delivered by public-private growth platform Tech Nation in collaboration with the MoJ and the Lawtech UK panel, will use the investment to provide resources, programmes and courses that promote new ways of delivering and accessing legal services.   

Established in 2018 prior to the first iteration of the programme by the Secretary of State for Justice, the panel consists of eight experts from the public and private sectors – among them Vodafone GC Rosemary Martin and panel chair and former Law Society president Christina Blacklaws – and acts as an advisory board for Lawtech UK. 

So far, the programme was found to have leveraged an estimated £2.30 to £2.60 from the private sector for every £1 it received from the government, according to an impact report published in March. 

On the first iteration of the programme, director Alexandra Lennox said: “We have seen great progress towards this future since LawtechUK’s inception and this next phase of funding will build on those important foundations, helping cement the UK’s position as a global hub for technology and law.”

Lennox took the reins from former Lawtech UK director Jenifer Swallow, who vacated her role leading the programme in July. 

Lubna Shuja, vice president of the Law Society of England and Wales, said the latest investment from the government was a positive sign for the UK’s status as a destination for legaltech innovation. 

“We have seen first-hand how lawyers have utilised technology during the COVID-19 pandemic, with the justice system moving online and legal professionals providing services remotely, innovating at pace to keep the wheels of justice and business turning,” Shuja said. 

Research commissioned by the Law Society from KPMG showed the UK is behind only the US for legal services, with the sector contributing £60bn in gross value added to the UK economy and employing some 552,000 people. 

The government creates a knock-on effect on other sectors by investing further in LawtechUK, the research showed, with legal services providing between £3.30 and £3.50 of additional gross domestic product for the UK across other sectors of the economy by 2050 for every £1 of improved productivity in the legal services sector. 

Shuja added: “As we work with hybrid or flexible models, technology will play a prominent role so the profession can continue to deliver high-quality legal services to their clients globally.”

The programme will continue under Tech Nation with the latest investment until December 2023. A selection process this autumn will choose a new provider that will take over from January 2024 to March 2025 with a new round of funding. 

The first round of funding was behind the creation of initiatives like the Lawtech Sandbox, a programme that included the establishment of an online dispute resolution platform offering SMEs a cheaper alternative to resolving late payment disputes and the development of the Lawtech Online Hub and Training Centre. 

The sandbox was found to have had the largest impact on the sector out of the initiatives, according to an external impact report published in March, with regulators reporting the sandbox gave them the chance to create more coordinated approaches to the adoption of tech in the legal sector as part of the programme’s regulatory response unit. 

Minesh Patel, founder of sandbox participant Amplified Global, called the sandbox and initiatives like it a “lifeline” for UK startups. 

"The LawtechUK programme has rapidly accelerated our growth and helped us to get the product to market quicker than we could have ever imagined," Patel said. “Without the Lawtech Sandbox, an organisation of our size and stage would have found it really difficult to be working, or even engaging, with a telecoms giant and the cross section of stakeholders and regulators that we did.”