UK Government Legal Procurement ‘Limits Playing Field’ for ALSPs

Factor, the pioneering ALSP, has claimed that the UK Government’s procurement of legal services excludes providers that are not ‘full service’, which then ‘limits the playing field’ for ALSPs and prevents them from joining its multi-million pound legal services panels.

While Big Four firm, PwC, which has a large legal advisory arm of its own, i.e. it is ‘full service’, is on one of the Government legal panels, there are no ALSPs that focus primarily on process work and that don’t offer regulated legal advisory services on its two main legal panels.

Many ALSPs would be able to handle areas such as commercial document review, contract management, and contracting services in general, among other areas. They would also likely save the country a notable amount of money during what is a time of major economic challenges for the Exchequer.

The claims come amid a backdrop of proclamations about the importance of innovation in legal services from the Ministry of Justice and other Government departments. The UK also has one of the most liberal regulatory regimes in the world and allows many types of legal business to operate here.

Factor, which is US-based, but has a strong presence in the UK, had been looking into opportunities to win panel places with the Crown Commercial Service (CCS), the body that procures providers for the Government’s panels for legal services – which in total are worth in the hundreds of millions of pounds.

In particular, Factor was focused on the main General Legal Advice Services and Finance and Complex Legal Advice Service panels, which currently list 17 law firms in total, such as: Dentons, DLA Piper, Hogan Lovells, Slaughter and May, and Linklaters; as well as Big Four firm, PwC.

They were surprised to find not only that there were no ALSPs (other than PwC, which has a large legal advisory arm) on the main UK Government legal panels, but also – in their view – the criteria made it very hard for anything other than multi-practice legal providers to get accepted. In effect, process-focused ALSPs appear to have been excluded, despite years of State-backed promotion of legal innovation here.

Sandy Devine, Chief Client Officer of Factor, told Artificial Lawyer: ‘The UK has long been a leader in introducing innovation to the practice of law, which has accelerated the creation of many high-end, specialist legal services companies.

‘So, it’s surprising to see the British Government take such a traditional approach in its recent tender for legal services. The approach effectively precludes central Government from tapping into the expertise and capabilities that exist outside of large global (law) firms, limiting an expanded playing field that could bring new thinking and proven solutions to the delivery of complex, scaled legal services.

‘This is a real head-scratcher when you consider how the Ministry of Justice is leading the globe in transforming the justice system and in using digital services and technology.’

Artificial Lawyer contacted the UK Government’s CCS to ask about their position on the use of ALSPs.

A spokesperson for the CCS told this site: ‘Although our recent procurements may not have been suitable for the service offering of ALSPs due to the requirement for either full service or very specialised advice and services, we would like to encourage their interest in Public Sector Legal Services RM6240 panel, which is currently being developed.

‘Innovation in the legal services market is, of course, not limited to ALSPs and we are always keen to engage with the widest range of organisations to help us shape our strategies.’

‘Whilst our existing agreements have not addressed more process level work as an individual work package, we remain open to looking at this in the development of future agreements depending on both our engagement with the market and with our users in the public sector,’ they added.

This does seem to suggest that the CCS is open to ALSPs – at least in theory – but the problem remains with how they are describing their panels by demanding ‘full service’ providers.

The world has moved on since the days that complex legal service provision was only done by ‘law firms’. Legal needs are not all advisory. Significant parts of the commercial legal world can be handled by process-focused ALSPs. But, under the way the CCS has been looking at this, if you don’t have a multi-practice advisory service, e.g. like a traditional law firm, or are a Big Four firm with a large, multi-practice legal division, then it’s very hard to get on a panel.

It looks like the answer is for the CCS to rephrase their criteria to enable a broader range of providers to support complex commercial legal needs, i.e. not just for specific advisory aspects, but also for the process work that is part and parcel of this.

Let’s see where this goes. The panels are about to undergo a refresh. It would be ironic if the UK Government, which is one of the loudest supporters of innovation in the law, continued to hold back change that could actually help its own finances in a time of economic difficulty.