The UK Labour government won?t provide industry with financial incentives to deal with Year 2000 issues, according to Barbara Roche, Minister for Industry - even though the millennium crisis could cause up to a million job losses.
When asked yesterday whether the government would provide tax relief to defray the huge costs of the date change conversion, Roche said: ?No. The government is providing #1 million to launch Action 2000. This problem came from industry and industry must solve it.?
The minister was speaking at the publication of new research on the millennium and its effect on small and medium enterprises (SMEs). Despite her unwillingness to consider direct financial assistance, Roche said: ?This issue is going to affect the whole of society. It will have a serious effect on us all... it is about business survival so it must be a top management priority.?
Sharing the platform with the minister for industry was Robert Guenier, departing chairman of Taskforce 2000. His successor at Action 2000, the Labour government?s new agency for the millennium, will be announced next week, according to Roche.
Guenier said: ?The results were dreadful but unsurprising. Our campaign was hampered by a dearth of data and we had to rely heavily on anecdotal evidence. We had no data on SMEs, yet the heart of UK industry is represented by SMEs.?
He added: ?1.2 billion businesses employ 10 million employee ... a 10 per cent failure rate, which is very possible ... could create one million unemployed. The consequences are amazing and unacceptable.? The survey, co-sponsored by the DTI and Sage Software, and performed by Tate Bramald Consultancy, is based on 902 responses from a mailing of 50,000 questionnaires. It is said to the first of its kind in Europe.
Awareness appears to be high, with 97 per cent of respondents claiming to understand the business implications, yet 60 per cent think business needs to be more aware of the consequences. More than 80 per cent are attempting to resolve the issues inhouse, yet most do not have the requisite resources. 45 per cent have not completed a systems audit yet, and they have no idea how long it will take to become millennium compliant.
. But 14.3 per cent have done nothing at all to date. 57 per cent of all respondents have not allocated any funds for from their 1997-1998 budgets.
The DTI warns that retail and transport are the sectors most likely to be hit hard, and the survey anticipates that their implementations will take more than a year, affecting computers, warehousing systems, Epos and bar cards. The problems are expected to have a deeper impact on their infrastructures than on other sectors.
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