In a new report published today, the NAO said the service - which completed the first stage of reforms in September - faces a “daunting challenge” in delivering the planned scale of technological and cultural change.

It warned that despite extending the timetable for reform from four to six years, there is “a significant risk that HMCTS will not be able to achieve all it wants within the time available”.

While one area has performed better than anticipated (the estates reform project has generated more income than expected), there have been significant delays in developing and delivering the Common Platform case management system, a key component of HMCTS’s programme to move from a paper-based to a fully digital system.

Challenges exist in delivering the change portfolio, such as its reliance on other organisations to invest in new technology and change working practices, whilst having limited influence over these groups.

HMCTS is also reliant on new legislation being introduced for some elements of the reforms, such as the planned extension of virtual hearings, which remains uncertain. Without this legislation, HMCTS may have to make changes to the planned reforms, which is likely to cause further delays, increase costs and reduce benefits.

The NAO has recommended that HMCTS works with the Ministry of Justice, HM Treasury and other organisations in the justice system to jointly anticipate and manage possible adverse consequences of the planned changes.

It added that HMCTS must also “provide more detail on how the modernised services will work in practice, what has already happened and what else needs to be done”, as well as greater transparency of its objectives and progress and be clear how it is adapting plans in response to challenges.

Amyas Morse, head of the NAO, said: “Modernising the justice system is an ambitious challenge. HMCTS has improved its approach, but overall it is behind where it expected to be and significant risks remain.

“Not only could these delay improvements being delivered on time, the tight timetable could also force HMCTS to make changes before fully understanding the consequences for the justice system.

“HMCTS must continue to adapt its approach if it hopes to successfully deliver a modern justice system that works better for everyone and achieve necessary savings for the taxpayer.”