Millennium bug is already causing problems

ABOUT ONE in three of Britain's largest companies has already been hit by the millennium computer bug, according to the annual report of a government watchdog.

Many big businesses have found that their computer networks are incapable of planning beyond next year.

In one recent case the Halifax financial group sent out letters to customers offering a new service which would last from 1999 to 1900 because the computer could not recognise the year 2000.

Other companies in the finance, manufacturing and utilities sectors have encountered problems in managing contracts, inventories and financial controls for the new millennium.

Leaders of the Government's Action 2000 campaign believe such difficulties will begin in earnest next 1 January, when information technology systems will be trying to plan a year ahead.

"We hope the problems will be minimal. However it could serve to persuade companies that the millennium bug is not all IT hype," said Gwynneth Flower, managing director of the campaign group.

She warned that programmers at companies may have "fiddled" with systems, introducing additional problems which could be encountered next year.

With just over a year to go, Ms Flower estimates that between 350,000 and 400,000 small and medium-sized companies - many of them key suppliers to bigger businesses - have not yet taken adequate action to cope with the fact that computers may misinterpret the last two digits in the year 2000.

"Many companies are still looking for a miracle solution. There is no miracle solution," she said.

While nine out of ten companies employing 250 workers or more are taking adequate precautions, some of them will still be affected by failures at their suppliers.