CHAPTER TWO: SCALE AND POTENTIAL IMPACT OF THE PROBLEM
13. Although most of our witnesses agreed that the
century date change could potentially force errors in almost any
system, product or process that incorporates a date reference,
there are various estimates of the number of systems that are
likely to be affected.
Taskforce 2000 told us that "most computer systems (large
and small, old and new) and almost countless 'embedded' microprocessor
chips are potentially affected".
Several bodies have recently undertaken surveys to ascertain precisely
how many systems and organisations will be affected. In 1997,
PA Consulting found, in a comprehensive survey in the UK and Ireland,
that only 3% of organisations felt that their systems would be
unaffected by the century date change, with a further 6% not knowing
whether their's would be or not. The remaining 91% of respondents
believed that the century date change either had or would have
an impact on their organisation (see table 1).
Expected Impact of the Century Date Change on Organisations
Impact in 1997
Impact in 1998-99
Impact in 2000
Did not know
Source: Defusing the Millennium Time Bomb,
14. Taskforce 2000 told us that, left uncorrected,
"80 per cent of computer systems of all kinds ... and something
between 10 and 30 per cent of embedded systems will fail in one
way or another".
Similarly, Greenwich Mean Time, a company formed specifically
to address issues arising from the Year 2000 problem in PCs, told
us that the majority of the 20 million PCs that are estimated
to be in use in the UK at present will experience some form of
hardware or software disruption.
15. While we can quantify the number of systems likely
to be affected, such statistics provide no qualitative indication
of the extent to which organisations are likely to be impacted.
There is an enormous difference between the consequences of failures
in minor systems, like a pocket calculator, and a failure in a
system which performs business or safety-critical functions. Moreover,
while organisations may be able to cope with the failure of one
system without any serious repercussions, the outcome may be completely
different if a number of systems, minor or otherwise, fail simultaneously.
Consequently raw statistics give little indication of the nature
or degree of risk that century date change related errors may
pose either socially or economically. We attempt to address this
issue below but, in doing so, are conscious that these assessments
are based on the assumption that no corrective or preparatory
measures had been taken.
Potential Impact on Businesses and the Economy
16. The London Stock Exchange pointed out that there
were few areas of commercial life "untouched by the implications
of the Year 2000 date change" and most of our witnesses from
the business community agreed that the consequences of failing
to take remedial action would be significant.
For instance, SmithKline Beecham told us that "left unaddressed,
the Year 2000 problem would arguably have been the biggest threat
to business continuity that SmithKline Beecham has ever faced".
Railtrack told us "unless addressed ... the problem would
cause serious and prolonged damage to the operation and hence
the viability of the whole of the rail industry".
Shell UK believe that, had they taken no corrective action, "there
would have been serious consequences in terms of failure to continue
to supply oil and gas".
Failures to continue to operate on such a scale would clearly
not only have a detrimental impact on national GDP but would also
have implications for the performance of other companies reliant
upon the services provided by those that had failed. Therefore,
even though the implications of non-compliance vary from system
to system, we find it incontrovertible that, in the absence
of adequate remedial action to address the century date change
problem, there would be a significant negative impact on the UK's
future economic performance.
Potential Impact on Society
17. Other witnesses pointed to the potential of the
century date change problem to affect individual citizens beyond
the inevitable consequences of a downturn in economic performance.
The Consumers' Association told us that "there is ... the
possibility of consumers suffering financial loss, major inconvenience
or breach of data protection safeguards" as a result of failures
in, for example, transactions, billing and credit rating systems
in banks or credit card companies; insurance company records;
social security payment systems; workplace salary systems; or
local authority administration systems.
18. Malfunctions or failures in systems which perform
safety-critical or essential operations, such as air traffic control
systems; road or rail signalling; medical equipment; safety control
equipment in factories or equipment controlling the labelling,
storage and distribution of perishable foods, would present more
fundamental risks to the public. For example, Thames Water, whose
operational monitoring and control systems for major water and
waste processes are dependent on embedded systems, told us "any
failure of our services for a significant period of time would
have a potentially serious impact on the public health of millions
19. Assessments of the nature of the problem and
the potential impact that widespread malfunctions in computer
and embedded systems could have on the economy, the national infrastructure
and society at large, are important as they provide the imperative
behind remedial action. However, as the Institution of Electrical
Engineers told us, there has been "much 'hype' and scare
mongering" in some reporting of Year 2000 issues and that,
at times, "the consequences of failure to deal with the problems
have been exaggerated".
Though predictions of doom generally have failed to account for
the fact that some remedial action has already been, and continues
to be, taken we, like the majority of our witnesses, conclude
that the century date change problem could, if not solved, cause
severe difficulties in many critical public services.
Ev.pp. 24 and 161. Back