Millenium timebomb" threat to trade contracts

Leading industry suppliers will lose important contracts unless they can prove they have systems in place now to deal with the threat posed by the "millenium timebomb".

The problem is posed by the fact that many computers will be unable to function beyond midnight on December 31, 1999.

Whitbread director of procurement Roger Keeling said: "We already check with our suppliers that their machines will not crash because they are unable to recognise the change of date from 1999 to 2000.

"It is one of the criteria we use when choosing suppliers."

Many firms have already invested in systems to cope with the problem. But others have still to take action.

The Federation of Small Businesses (FSB) estimates that less than a third of UK companies know how to deal with the problem.

Others may be put off by the cost of dealing with the changes, which runs into thousands of pounds even for small firms.

The FSB advises small firms to "put someone in charge" of the millenium timebomb.

NatWest has created a reserve of £90m to address the issue. The bank said: "Lots of small businessmen have been told that there is the equivalent of an explosive device ticking away in their premises.

"The Government's IT experts believe this will effect every business and organisation in this country.

"Businesses that fail to take precautions are running a real risk of losing money or going bust."

NatWest has published The Year 2000 Computer Problem - a practical guide for businesses, which is endorsed by the Department of Trade and Industry.

It is aimed at small businesspeople who may have little or no technical knowledge of computers.

The guide contains a six-point approach to becoming "millenium compliant".

Free advice is also available from Microsoft on 0345 002000 or IBM on 0800 973219.