UK businesses are losing at least £12.2 billion a year on repeatable and avoidable legal work, according to new analysis that links contracting practices to the country’s wider productivity problem.
The study by legal technology firm Genie AI estimates that inefficient contract drafting and negotiation absorbs around 0.47% of UK economic output each year. The figure covers both external law firm fees and work carried out by in-house legal teams.
Of the total, around £5.6 billion stems from external legal spend on contract tasks that the analysis classifies as avoidable or repeated. A further £6.6 billion to £7.0 billion arises inside companies, as in-house legal departments rework similar documents and clauses.
Genie AI’s assessment suggests that a significant share of routine contract work remains bespoke and labour-intensive despite the existence of templates, boilerplate language and sector standards.
“This is a societal problem caused by the historic gatekeeping of knowledge in the legal industry,” said Rafie Faruq, Co-Founder and CEO of Genie AI.
Faruq said that repeated drafting sits at the heart of the issue. “We are writing the same contracts twice, negotiating the same clauses over and over again. There is a need for a global legal standard that could dramatically reduce lost GDP, and the UK would be materially closer to hitting the growth rates it was expecting just a few months ago.”
Hidden drain
The analysis focuses on the contracting work that underpins commercial activity across sectors. It highlights that organisations often start agreements from scratch, renegotiate standard clauses on every deal and pay law firms multiple times for documents that are materially similar.
In many cases, in-house lawyers then re-review and amend the same types of clauses or documents across different counterparties and departments. Genie AI describes this pattern as a “silent” cost within legal and business operations.
“Highly skilled professionals are reinventing the wheel, not because they want to, but because the systems they use force them to. Our analysis shows the price of that repetition is not just a legal budget issue, it’s a macroeconomic productivity issue.”
Sector breakdown
The study identifies significant variation across industries. Technology and digital services, including software, account for an estimated £2.4 billion of annual waste on repeated legal work. Real estate and property contribute a further £1.6 billion.
Energy, resources and industry are linked to another £1.6 billion of inefficient legal effort each year. Construction and infrastructure see around £0.8 billion of similar costs, according to the analysis.
These sector-level figures sit within the broader £12.2 billion to £12.6 billion range that the report sets out for the UK as a whole.
Internal versus external
The research draws a distinction between external legal fees and in-house expenditure. It notes that the UK legal sector generates more than £40 billion in annual turnover, with corporate work forming the majority of that activity. Genie AI estimates that around £5.6 billion of this is tied to repeatable or avoidable contract work.
On the corporate side, in-house legal teams now represent around 54% of total legal budgets. The analysis suggests that repeated contract tasks consume between £6.6 billion and £7.0 billion in internal legal capacity each year.
Combined, this indicates that more than £12.2 billion of legal effort is absorbed annually by tasks that could be automated, standardised or removed.
Tooling gap
The report places responsibility on legal infrastructure rather than on individual practitioners. It points to fragmented knowledge, lack of clause reuse systems and outdated document workflows as core drivers of the problem.
“This isn’t about lawyers being inefficient, it’s about the tools and processes they’re given,” added Faruq. “Most legal teams know they’re doing repeat work. Until now, they simply lacked the infrastructure to capture, maintain and securely reuse standardised, trusted clauses at scale. Fortunately, that’s starting to change.”
Genie AI argues that wider adoption of standard clause libraries and automated drafting could reduce repetition. It highlights the potential for systems that surface past work, provide vetted templates and insert market-standard language automatically, while still leaving room for bespoke negotiation.
“By capturing market-standard clauses, surfacing relevant past work and drafting agreements automatically, AI tools can eliminate the need to recreate standard terms whilst still allowing teams to edit and instruct on the bespoke, strategic elements that matter most.”
Wider productivity stakes
The analysis links repeated contract work with delays in revenue recognition, slower deal cycles and lost commercial opportunities, although the headline estimate focuses only on legal time. Genie AI states that the true economic cost is likely higher once business-side time and operational disruption are included.
In a services-heavy economy, legal and contracting functions sit within many high-value transactions. Genie AI positions changes in those functions as a source of potential productivity gains that do not require major new capital investment.
“In a services-based economy like the UK’s, productivity improvements come from working smarter inside the businesses that drive GDP. We need to move legal from being a cost centre to a productivity multiplier.”
The company describes its £12.2 billion figure as conservative. “£12.2 billion is a conservative estimate,” said Faruq. “The true number is likely far higher once business-side time, operational delays and lost deal value are included. Standardisation isn’t just good legal practice, it’s a national productivity imperative.”