The demand for effective solutions for pressing justice problems is both evident and substantial. New methods to resolve problems are available, as are supporting technologies. Yet in most countries the gamechangers needed to resolve all pressing conflicts effectively have not yet emerged. If a task force wants this to happen, its members need to think about how the financial and regulatory environment can enable it to do so.
Evidence-based treatments and service delivery models operate in the regulatory environment for legal services. In many countries, only lawyers who graduated from law schools are allowed to give legal advice. Regulations also restrict the business models lawyers are allowed to use. Dispute resolution services by courts are regulated by rules of procedure. Moreover, newly developed services need to find a place in budgets and procurement systems.
Introducing game-changing justice services is not for the politically naive. A task force needs to pave the way. It should work on reforming regulatory, relational and financial systems so that they can better accommodate scalable models for justice services and effective interventions. The guiding principle of this strategy is to ensure a level playing field that allows game-changing justice services models, treatments and interventions to compete with existing offers. A task force needs to work on this from the start, in parallel with the first three strategies. Strategic timing and early wins are crucial. As we will see in the next sections, this can be difficult, but task force members have many levers of change available for their strategic use.
This is what can happen if the enabling environment is not addressed early on:
The task force has been established and its members have jointly assumed ownership of improving the enabling environment. Domestic violence problems have been prioritised and goals and targets have been agreed upon. One or more gamechangers have been selected. Scaling-up work on the gamechangers has started, ensuring that effective treatments will be more widely available. The task force is now convinced that game-changing services can be organised, become sustainable and reach most people with justice problems, either in communities, online or through specialised one-stop court procedures. The task force reports to the ministry. It is thanked for its great work and…five years later a member of parliament asks the minister to set up a committee to investigate the urgent and pressing problem of avoidable domestic violence.
Working to create the enabling environment should be undertaken in parallel with executing other strategies and should start early on. If it starts too early, however, it will have insufficient momentum. Justice innovation has a chicken and egg problem. Civil servants or politicians responsible for regulation will always ask what changes in the laws are needed for a particular innovation. Rightly so, because they have seen many major law reform projects fail. They need to see a new justice service working at scale before they will consider revising the regulatory framework.
Unfortunately, many innovations will become stuck in the early prototype stage. Innovative services offering evidence-based interventions can only grow into gamechangers if they can land in a positive enabling environment where they are welcomed and rewarded with access to a market made up of people with pressing justice problems. Without this reward in sight, few justice insiders and few entrepreneurs from outside the sector will start the complicated ventures that can lead to game-changing justice services.
Our experience is that a powerful example of a game-changing service — or at least a prototype and a strong initial validation by a task force — is needed to create momentum for regulatory innovation. As we will see below, the US regulatory environment for legal services needed the example of LegalZoom before it could begin opening up.
The need to improve the enabling environment can be illustrated by the initial results of the strategy for evidence-based working. The task force can demonstrate that the codified way of dealing with conflicts and crime through adversarial procedures is much less effective than what practitioners currently do and what research recommends.
If the task force acts too late, it will lose momentum and deplete its budget. As a result, teams working on innovative services may give up and the frustrations with outdated ways of working will increase. The public will continue to have the impression that justice sector institutions perpetuate injustices.
Ideally, the enabling environment needs to be created within two or three years. This is the normal cycle of government and the time horizon for a minister of justice. For investors, this is an acceptable time frame for an initial round of funding. Within this timeframe, the task force must operate strategically, choosing from a number of options, as outlined below.
In the HiiL model of justice transformation, creating the enabling environment consists of separate stakeholder dialogues with a focus on integrating gamechangers into laws and budgets. Members of the task force will need to align their work schedule with the rhythms of governance in ministries and parliaments. This is the world of national development plans, coalition agreements, ministerial budgeting and court financing. It is also the world of experts deciding on revisions of codes of procedure and bar associations that have a crucial role in legal services regulation.
The task force will need to reflect on political sensitivities. A political economy analysis may be helpful. In many countries, this analysis will show a political arena that is polarised between conservatives and liberal progressives. It is likely that the political economic analysis will reveal that justice policies are shaped within a framework in which conservative parties emphasise toughness on crime, national identity and respect for authority, whereas progressive parties focus on social safety nets, inclusion and participation. Family justice can be heavily politicised by ideas on family values or by gender stereotypes. In employment justice, progress may be difficult without the consent of trade unions. Legal aid is more likely to be promoted by left-wing parties than by parties representing the interests of businesses.
People-centred justice can best be framed as a technical and neutral approach aimed at better treatments and more effective justice services. That said, coalitions still need to be formed between groups that hold power. Breakthroughs in the form of justice policies that have gained broad support have occurred. Recently, many governments have succeeded in reforming criminal justice. In the United States, a coalition was forged between Republicans wanting to save prison costs and reduce recidivism and Democrats wanting more humane, effective treatments and less incarceration.
Several coalitions are possible. In the European Union, economic considerations have created momentum to deregulate legal services. In England and Wales, where there is a strong legal services industry, independent regulators have been created as a first step. In the United States, coalitions of politicians, leading justices, vocal minorities in the legal profession, a new generation of law professors and innovative legal service providers have formed in several states. The drive to innovate and make justice more accessible is becoming stronger than the tendency to defend the adversarial legal system. In African countries, ministers (or attorney generals) and leading judges are inclined to open up the legal system to community justice services, which are more consistent with local values related to social harmony and justice. These coalitions are supported by NGOs and donors who work from a development and human rights perspective. The case for justice reform is also made by national planners who need to deliver economic growth.
A task force can perhaps not actively create such coalitions, but it can certainly contribute to them. We have seen in Canada, Nigeria and the United States that coalitions sometimes form at the provincial or state level, and then extend to other states. Smaller states and city states move forward more easily than do big countries.
A more technical element of the enabling environment is the budgeting process. This is where an investment plan for a game-changing justice services is likely to land. Investments need to be budgeted. If the sustainable revenue streams for the gamechanger include permanent subsidies from the government, then subsidies need to be secured in a budget (HiiL 2020).
The public justice sector consists of several agencies. The most visible are the courts, prisons, prosecution and police. Countries may also have a forensic laboratory, a legal aid board, probation services, immigration authorities and agencies providing registries.
These agencies either compete for a slice of the ministry of justice budget, or have to negotiate a share of the general state, county government or municipality budget. Each agency can try to generate additional income from citizen contributions. The government budget allocated to the justice sector is occasionally increased, but more often it will remain proportional to the government budget or a percentage of GDP.
How can the task force find money for better treatments and service delivery models in this environment? We offer several options to be further explored by task force members. There is no simple answer yet regarding what works.
The task force can present the investment plan to the authorities responsible for the budget, showing the fixed costs that need to be funded upfront and a clear trajectory towards breaking even. With limited investment needed and outcomes defined and ready to be monitored, the plan may compare favourably to plans to increase the capacity of police or courts. Task force members can try to convince participants in the budgeting process that a separate budget line for innovation is appropriate, and to reserve 2% or 3% of the total budget for this. This is an objective indicator for investing in research and development that is generally accepted but usually not yet met in government justice budgets. Task force members could even make the argument that systems for conflict resolution need to catch up with a multi-year investment in the range of – say – 10% of budgets that has to be provided from the national budget.
If a new game-changing service requires subsidies from the annual budget, a new agency can be established. This happened in Sierra Leone, where the $1 million annual budget for the legal aid board budget represents 10% of the total budget for the judiciary and courts (Manuel 2020). In some Latin American countries, community justice services (judicial facilitators) are subsidised as a percentage of court budgets. In these examples, the negotiations took many years and potentially game-changing justice services were brought to scale gradually, which helped to make the case for opening up the regulatory environment but also created little urgency to adjust the budgets rapidly.
Task forces must consider how this new budget line will affect the budget for courts, police, prisons, prosecution and other agencies. In times of budgetary constraints, stopping doing “non-essential” new things has proven to be an easy way out for core justice institutions.
The task force may therefore prefer to promote an objective budgeting method, where outcomes and their costs are compared. Performance-based budgeting methods are slowly being introduced in the justice sector. Ministries of finance, donors or philanthropists may require budget holders to accept such methods.
A task force can anticipate this shift towards new ways of budgeting by providing an alternative budget for justice services that is based on outcomes for people. As explained in our Charging for Justice 2020 report, core funding for current justice sector institutions could be combined with outcome-based funding for preventing and resolving justice problems. The justice problems experienced by people can be the baseline for this, with agencies invited to show how their activities and outputs contribute to prevention and resolutions. This should include how courts contribute to the “shadow of the law”. One of the outcomes courts achieve – but are not paid for in most systems – is that their existence and availability as an adjudicator convinces people to agree to fair and speedy resolutions. Just by being there and available ready to intervene, courts settle many disputes.
Another approach for a task force is to team up with existing agencies. Courts or police can reallocate their budgets to game-changing procedures and prevention programmes. They may face internal pressures when doing this – legal aid lawyers may resist investments in legal information websites, for example, or courts of appeal may resist shifting budgets to one-stop shop procedures.
The most likely pathway to funding is to demonstrate that game-changing justice services can increase the overall budget and contribute to better performance by existing agencies. Better outcomes — through one-stop tribunals and problem-solving courts, for example — can increase revenues for the judiciary. In the United States, drug courts benefited significantly from the fact that federal funding was increased and contingent on participation in rigorous evaluations that they might not otherwise have been able to afford. This research enabled them to demonstrate their cost-effectiveness and secure sustainable funding streams early on. Furthermore, legal aid boards can increase their revenues and provide better outcomes when they set up community justice services and online platforms. Police can invest in prevention programmes that reduce crime and therefore the costs of policing.
A task force can set an example to encourage thinking about strategies to increase revenues. We have learned that revenues are not a concept that court leaders automatically connect to. We recommend exploring this topic in depth by investigating different sources of funding and building a common understanding of how sustainable funding rewards practitioners. Rewards come in different forms: for example, being part of a highly effective team, having access to the methods and tools to be effective, more time to handle complex cases and opportunities for professional growth.
Court leaders may also be made aware of other revenue streams. One example is charging fees with a healthy profit margin to businesses with complex court cases. In many countries, court fees are set by legislation and schedules are not regularly adjusted. In China, this is done differently (Ng and He 2017). Chinese courts have to optimise their funding. This funding process is discussed openly and in relation to the incentives it may generate. Courts may become too dependent on contributions from the local government and this may be a reason for the central government to step in with funding. A few courts have asked major local companies for contributions, knowing that they can benefit from law and order. Some courts have also been successful in generating more commercial cases that bring in higher court fees, but these can come at the expense of serving the justice needs of the broader population. Researchers Kwai Hang Ng and Xin He found that some courts offer reductions of prison sentences in return for higher fines. A transparent dialogue about funding options is needed. It can reveal the trade-offs that exist in any financial system for a public service. Justice services cannot be assumed to be different from other parts of public life.
Some countries have found interesting avenues for cross-subsidisation. The best-funded court systems are probably those of Germany and Austria (CEPEJ 2020). Their dispute resolution services are paid from registration fees which cross-subsidise services for the broader population. In their remuneration schedules for lawyers, large claims subsidise small claims. In Sweden, most people have insurance for legal expenses, which tends to be included in the indemnity insurance for their house.
In low-income countries, international donors like the European Union, the World Bank and aid agencies may be willing to make funding for the justice sector conditional. For example, they can make funding for courts or the police contingent on the implementation of service delivery models that are effective and on promoting evidence-based practice. A task force may want to reconcile the donor need for tangible outcomes with the need of justice sector leaders for additional revenue streams.
The enabling environment for justice services consists of regulation of legal services, rules of procedure and rules for legal education. Community justice programmes, one-stop shop procedures and problem-solving courts can only function if rules of procedure allow them to. There are many ways in which the regulatory environment influences what can be offered to the public and who can be involved (see box with the most common examples)
When designing and delivering effective justice or legal services, suppliers may face a variety of regulatory barriers. The following list summarises a number of common ones.
To implement a single game-changing service, many of the rules may need to be changed. In 2013, HiiL helped Dutch courts design a one-stop procedure for neighbour conflicts. The design conflicted with existing rules on formulating claims, serving documents, and defending against claims and court judgments. The mediation services built into the new procedure raised issues regarding mediation by courts being allowed, representation by lawyers and confidentiality of mediation. Informal communication with judges, and the storing of data on the cloud, have led to additional discussions about interpretation of the rules. In 2021, the Dutch were still using formal and costly civil legal actions that can take up to two years to solve a pressing nuisance problem and the new procedure is still not implemented.
Innovators providing game-changing services are thus likely to be entangled in a web of incompatible rules. Incumbents, who deliver documents and handle cases in the traditional way, want innovators to follow the same rules. Unsurprisingly, this is their understanding of a level playing field. In the justice sector, incumbents derive extra power from their proximity to the system that enforces the rules. Bar associations and courts apply these rules in the way they are used to, working from precedent. They are not equipped to consider the effectiveness of new solutions for users compared to the current solutions. They mostly do this without having the intention to make life difficult for justice start-ups or to block game-changing services; they just want to uphold the rule of law in their own backyard.
The result is that many innovators face an uphill struggle. Either they shrink their services to fit the regulation, or they face long legal battles and risk facing sanctions that destroy their business. Bar associations frequently bring suits against providers of innovative services. Services that have scaled across jurisdictions may be burdened with legal challenges from multiple local bar associations at once.
Innovators and incumbents both need a level playing field. The current regulatory regime for legal services and court procedures stifles innovation. This is perhaps the single biggest barrier to access to justice: the solutions and services that work often cannot be implemented.
The American Bar Association prohibits non-lawyers from practising law. Because of this, LegalZoom has been sued by individual lawyers and accused by state bar associations on the charge of unauthorised practice of law (UPL).
Here, the bone of contention is not the provision of blank legal documents or forms per se, which is permissible by law. Rather, what ruffles feathers is the provision of customised and personalised legal documents to customers. LegalZoom’s software asks the customer to answer a series of questions specific to the legal document requested. The software assesses the individual’s needs, marital status and location. Based on this information, it creates a customised legal document. This service offered by LegalZoom has been considered tantamount to UPL by various state bar associations and lawyers.
The UPL statute is meant to protect consumers from fraudulent individuals who may pose as lawyers and damage the interests of the people. However, critics reason that if well regulated, non-lawyers can provide effective legal services at a fraction of the cost of a lawyer.
A turning point came when the State Bar Association of North Carolina issued cease and desist letters to LegalZoom on the charge of UPL. LegalZoom fought back by filing a case against the State Bar Association stating it was promoting monopolistic practices in the field of law. The two sides reached a settlement in 2015 in which the State Bar agreed to support online providers of legal services provided the latter enacted regulations to protect the interests of consumers. This is when LegalZoom found support from other national public institutions. The Antitrust Division of the Department of Justice and Federal Trade Commission supported this agreement and acknowledged that LegalZoom filled a lacuna in the provision of affordable legal services.
Despite the commercial success of LegalZoom, the company faced litigation on charges of UPL for years. It took State Bar Associations and administrative bodies a long time to realise that such companies play a pivotal role in increasing access to justice and that rules and regulations need to be modified to allow such companies to flourish. These regulations should be modified not only to accommodate different types of legal service providers in the market, but also because new legal service providers need to be monitored in order to protect consumer interests.
LegalZoom possessed the financial resources and resilience needed to withstand pressure from a tough regulatory environment. Not all legal innovators may be able to do the same. How can the task force protect fledgling innovations and ensure they can flourish?
A regulatory sandbox is an emerging tool for this and one that a task force can promote. A regulatory sandbox allows the regulation of an innovation to be designed in sync with the innovation itself. A regulatory sandbox is similar to the regulatory environment for medical experiments. Clinical trials allow for comparing innovative treatments with current ones under conditions that control the risks for trial participants and optimise the potential benefits of innovations. The sandbox can allow for experimentation and deliver the conditions for a licence to operate the new treatment or service delivery model.
In August 2020, the Supreme Court of the State of Utah in the United States unanimously authorised a two-year “legal regulatory sandbox” pilot programme intended to bridge the access to justice gap (Utah Supreme Court n.d.). The programme’s mandate is to make it possible for non-lawyers and other agencies to experiment with innovative justice models and approaches to the system of law and justice. The effort is billed as a solution to the failure of the justice system to provide legal representation to poor, working-class and middle-class Americans. The changes followed the task force report entitled: “Narrowing the Access-to-Justice Gap by Reimagining Regulation”.
In a statement, Utah Supreme Court Judge Deno Himonas said,
New businesses and initiatives participating in the sandbox will be overseen by a new regulator: the Office of Legal Services Innovation. The regulator will work directly under the supervision of Utah’s Supreme Court (Utah Supreme Court n.d.).
The rest of the world looks forward with interest to the experiments carried out in this historic sandbox as it will provide important lessons for other justice systems, innovators and legal regulators.
In most countries that are reassessing the regulation of legal services, experts advise moving in the direction of regulation based on the treatments that are applied and the risks involved. They advise removing most restrictions on how law firms and other providers of justice services can be owned and governed, whom they can employ and who can take part in management. Details of service delivery models can be left to the suppliers.
A task force should consider a more substantial system change, which would really create a level playing field. Detailed regulation of legal services and procedural rules – which stifles the development of effective treatments by courts, police, prosecution and lawyers – can be replaced with a certification system.
Under a certification system, which is common in health care services, any effective new treatment or service can be proposed and evaluated. A court or agency can then design and develop a treatment, collect evidence about its effectiveness, and ask for approval by an independent evaluator. The same procedure can be followed by a law firm, startup or public-private partnership.
In most countries, your doctor is likely to be a private entrepreneur. Water is cleaned and brought to your tap by specialised companies. Electricity and public transport are other examples of public goods usually sold to citizens by the private sector. In the justice sector, work is outsourced to law firms, bailiffs, translators and foundations delivering probation services. Arbitrators and mediators are resolving disputes for parties who overcome the submission problem and jointly opt out of courts. Prison services and forensic therapeutic interventions are organised through different public-private partnerships.
A task force better avoids a discussion about privatisation, because this creates value-laden discussions about market versus government in a sector that is obviously delivering public goods. A preferred approach is to help government agencies consider their make or buy decisions. New interventions, treatments and service delivery models are developed by private and public initiatives. In order to benefit from private sector innovation, government agencies should be able to procure innovations from this sector. If the private sector offers services superior to those the nearest government agency can offer, it should be empowered to do so. In some countries, courts have a poor track record of digitising and modernising procedures. Until recently, they have tended to build custom case management systems – in spite of the fact that several providers offer configurable case management systems that can be accessed for a reasonable fee. As we have seen, many innovators have designed smart procedures that could be implemented by courts, shifting the innovation risk to the private sector.
As the examples above illustrate, task forces and ministries of justice would achieve better results if they allowed selected organisations to offer effective procedures and interventions. Currently, mandatory one-stop procedures are only provided by courts organised by governments or new government organisations (ombuds services, tribunals and administrative agencies). In future, the provision of these procedures could be outsourced to spinoffs from courts, led by an entrepreneurial judge, NGOs with a track record in justice services, IT companies selling case management systems with online dispute resolution capabilities, or start-ups run by lawyers-turned-justice entrepreneurs. The relevant regulatory body could allow private services certified by an independent government agency to be offered. Alternatively, it could contract one of the organisations mentioned above as the manager of a service with trusted judges paid by the state as adjudicators. A range of public-private partnership options exist.
Prevention programmes and community justice services have to make similar procurement decisions. User-friendly contracts, claiming platforms, and information and advice websites are more likely to be delivered by private companies. Private and public organisations can both supply similar services with similar outcomes for people. A claiming platform set up by a foundation or a startup is in a way a substitute for a user-friendly procedure hosted by a government agency. Information and advice websites can be run by startups, NGOs or government legal aid boards.
The task force may want to help the ministry of justice to design a procurement system that deals with these issues in an objective way. When a government procures a service, the playing field for competitors should be level. In order to get citizens the best deal, government agencies should be viewed as competitors.
An effective procurement strategy includes the option to buy or co-develop new technologies in a way that is fair to innovators and governments. HiiL has worked with many innovators who feel their innovations have been copied by government agencies. Contemporary procurement rules are being redesigned to optimise innovation and can provide inspiration on such matters.
The task force will need to invest much of its thinking in how to ensure a level playing field. One risk of this approach is that the task force is held up in lengthy discussions with the incumbent agencies currently delivering solutions. Interacting with different offices inside ministries or with bar associations can be complicated and time-consuming.
One possible way forward is to apply a method that is at the core of people-centred justice reform: to focus on outcomes and start designing the arrangement that delivers the most sustainable solution. In this case, the ideal agreement would increase revenues for justice sector agencies, incentivise reforms of treatments and services and make it possible to stop ineffective activities (by allowing adequate transition periods or providing compensation).
In the box below, we provide a general outline of such an agreement based on HiiL’s Charging for Justice report (2020).
CEPEJ, (2020). European judicial systems: CEPEJ evaluation report.
Cohen, M. (n.d.). LegalMosaic (blog). URL: https://www.legalmosaic.com/blog-2/blog-medium-2-2/. Accessed on August 3, 2020.
DeMeola, Z. (2020). Utah Supreme Court Makes History with Vote to Establish Regulatory Sandbox. IAALS (Blog).
European Commission, (n.d.). Innovation procurement. URL: https://single-market-economy.ec.europa.eu/single-market/public-procurement/strategic-procurement/innovation-procurement_en. Accessed on August 3, 2022.
Government of UK, (n.d.). Community right to challenge: Statutory guidance. URL: https://www.gov.uk/government/publications/community-right-to-challenge-statutory-guidance. Accessed on August 3, 2022.
Harvey, F. (2015). Paris climate change agreement: the world’s greatest diplomatic success. The Guardian.
Henderson, W. (n.d.)Legal Evolution (blog). URL: https://www.legalevolution.org/. Accessed on August 3, 2020.
HiiL, (2020). Charging for justice: SDG 16.3 Trend Report 2020.
Manuel, M. (2020). Speaking notes, OECD webinar, 22 October 2020. Overseas Development Institute.
Ng, K., & He, X. (2017). Economic Embeddedness: The Political Economy of Court Finances. In Embedded Courts: Judicial Decision-Making in China (pp. 142-166). Cambridge: Cambridge University Press.
Utah Supreme Court, (n.d.). What we do. URL: https://utahinnovationoffice.org/about/what-we-do/. Accessed on August 2, 2022
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