Financial Times, UK

April 11th, 1997

Alan Cane

Millennium bomb: Cost for UK put at £31bn

The cost of adjusting the UK's computers to cope with the turn of the century was yesterday put at £31bn by the head of the government organisation set up to tackle the so-called "Millennium Bomb" problem.

It is the first time the cost of reprogramming the UK's computers so they can distinguish between dates in this century and the next has been priced officially.

Most "guesstimates" by consultants and computing services companies have put the cost at only about a third of the new figure calculated by Mr Robin Guenier, head of TaskForce 2000.

This suggests that the seriousness of the timebomb threat is still underestimated by both businesses and the computer industry.

Mr Guenier said his calculations were a first attempt to put a sensible figure on the cost of overhauling the billions of lines of computer code underpinning British business.

The Millennium Bomb is a legacy of the early days of the computer industry when years were stored, for cost and convenience, as two rather than four digits.

This means computers will be unable to distinguish between 1900 and 2000 as both years are stored as "00".

The effects are already being seen in inaccurate sell-by dates in supermarkets and wrongly dated financial instruments.

Mr Guenier said his estimate was based on estimates of the proportion of the UK's 4m companies likely to be affected and the known number of staff already engaged exclusively on the problem.

British Telecommunications, for example, estimates it will need 1,000 staff at peak to check and correct some 300m lines of computer code. Nationwide Building Society has 180 staff reviewing its computer systems.

Mr Guenier said yesterday that companies' estimates of the number of staff they would need to tackle the problem was about 300,000 - roughly the same as the number of full-time computer professionals in the UK.

The implication was that with fewer than 1,000 days to go to the end of the century, completely solving the problem was impossible. He said too many companies remained complacent about the threat: "They understand the problem but they are not getting on with it."

Mr Guenier's fears were backed up yesterday by Mr Ron McQuaker, president of the British Computer Society, the UK organisation for computer professionals.

He called for organisations to clarify what action they were taking: "Although hundreds of courses and seminars have been organised, there is still little evidence to show what organisations are actually doing."

He said the BCS also believed the "embedded chip" problem, where a chip with a defective date mechanism is physically built into machines such as traffic lights or cars, may be more serious than originally thought.

Some companies, especially in the finance sector, are already paying their computer specialists a bonus to stay with them through the crisis.

Mr Guenier is concerned that small companies and non-profit organisations will not be able to afford the inflated salaries computer specialists will be able to command.

Those who do not convert their computers will be unable to exchange data with business partners whose computers are 2000-compliant.

In sectors where trading is carried out electronically, the results could be devastating.

© Copyright The Financial Times Ltd 1997

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