WRITTEN QUESTION E-0425/98 by Graham Watson (ELDR) to the Commission (24 February 1998)

Subject: The Millenium Bug

How much does the Commission estimate it will cost to ensure millenium bug compliance for all EU institutions?

Joint answer to Written Questions E-0422/98 and E-0425/98 Answer given by Mr Liikanen on behalf of the Commission (3 April 1998)

The Commission is concerned about the vulnerability of enterprises, infrastructures, and public administrations to the year 2000 computer problem as well as about the possible consequences for consumers. The Commission adopted a communication ((COM(1998) 102. )), in order to raise awareness and set out steps to address year 2000 issues. To complement the activities being undertaken by the private sector and the Member States, the Commission has begun implementing a number of activities on this issue, in close co-ordination with activities concerning the information technology (IT) impact of the euro.

An inter-service task force has been established by the Commission to address the impact on internal systems of both the year 2000 and the changeover to the Euro, and work is in progress. Given the importance of the issue, the task force will be steered by a working group chaired at the highest level in the Commission.

To assist general awareness and mobilisation, extensive consultations were organised with the public and private sectors in 1997, in order to identify the main priorities for action and the roles for enterprises, associations, administrations, and the Community itself.

The Commission will encourage the exchange of information and experience on year 2000 initiatives undertaken by Member States and European associations, with a view to identifying how synergy can be established to reduce duplication of efforts and increase the overall impact.

The Commission will co-ordinate its action with the European and international organisations that are responsible for regulating or supervising infrastructural sectors with significant cross-border effects (finance, telecommunications, energy, transport) in order to exchange information about the respective activities and identify where co-operation may be required.

The Commission maintains a world wide web site on the year 2000 computer problem and the IT impact of the euro (http://www.ispo.cec.be/y2keuro). This site provides access to information about activities in different economic sectors and Member States, points to sources of advice on specific aspects of the problem, and links to other sites as well as to all documents and reports produced by the Commission on the subject.

The Commission will discuss the year 2000 and its implications through all the relevant contacts available in industry and Member States. In particular, attention will be paid to the impact on and preparation of infrastructure sectors, the impact on consumers and small and medium-sized enterprises (SME), and the potential impact on the functioning of the internal market, including the economic and monetary union.

The Commission will, together with Member States, monitor progress, exchange information, and benchmark best practice while reporting regularly to the Council on the progress towards year 2000 readiness and its related issues.

The Commission will examine, in the context of its policies such as those on industry, SME, consumers, and training, whether a further contribution could be made towards helping raise awareness and address year 2000 related problems.

Within the Commission itself, the so-called 'millennium bug' is, handled by the Informatics Directorate for the central aspects and by each directorate general for their information systems. Since mid 1996 awareness of the year 2000 problem has been promoted continuously by the Informatics directorate inside the Commission. At the beginning of 1997 working groups were established to support analysis and solutions to identified problems. The project scope was established in 1997 and necessary resources were allocated. 1998 will be the year to fix and solve possible problems and 1999 will be the critical year to test and implement the solutions. The project year 2000 inside the Commission is following the phased approach, applied widely in the private and public sectors including risk management measures.

As for co-operation at an inter-institutional level, a contact group between the informatics services of the different institutions was set up at the end of 1997. This group follows the same approach as that within the Commission itself and the timing of the different steps is planned to enable an adequate resolution of this problem for all institutions. Developments are regularly reviewed within the inter-institutional informatics committee and appropriate measures will be taken, if and when necessary, to cope with specific problems.

Coming to the cost of this whole exercise, one has to bear in mind that the millennium bug is not only seen as a technical risk for computers and information systems, but also treated as an opportunity to re-engineer IT related domains. It has already given rise to changes (in the modernisation of the infrastructure, the renewal of information systems or the move to software packages) which were only slightly anticipated in comparison with the previously established schedule. It is furthermore difficult to distinguish between IT investments required by compliance, maintenance or modernisation activities. Although the year 2000 problem and the introduction of the euro cannot be compared as to the ways of solving them, it is, for example, common practice for the modernisation of an information system to render it year 2000 and euro compliant to be done at the same

time by the same people. It would therefore be very difficult and not very cost-effective to try to dissociate the costs of both transformations. As a matter of fact, the adaptation of information systems to the year 2000 already started within the Commission in 1996, and continued during 1997 and 1998. It was mainly incorporated in the global cost of maintenance and modernisation of applications' budgets. Its cost cannot be identified precisely.