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THE YEAR 2000 TASK FORCE

After the Committee's first Year 2000 interim report, the Year 2000 Task Force issued its last report in July 1998 entitled A Call for Action: The Eleventh Hour. The Committee fully supports the Task Force's recommendations in that report. The Chair of the Year 2000 Task Force confirmed to the Committee that:

• Only 1% of businesses remained unaware of the Year 2000 problem.
• Canadian business has made great progress; 70% of businesses had taken action by May 1998, versus 45% by October 1997 (this figure includes 94% of medium and large businesses).
• Companies taking action represent 90% of employment in Canada.
• The focus for companies and governments should now be shifting to contingency planning.

Main sources of information for the Task Force were the two surveys conducted by Statistics Canada on Canada's Year 2000 readiness. Some of the main points of concern highlighted by Statistics Canada's second survey on Canada's Year 2000 readiness are:

• Only 58% of small firms expect to be Year 2000 compliant by the end of 1999 with no information on the remaining 42%. As well, only 15% of small firms have formal Year 2000 plans.
• There are some potential problems with larger firms. While only 6% plan taking no action at the moment, formal or informal, 27% do not have a formal plan, and roughly another 8% have some formal plans but are planning to have their work completed only in the second half of 1999. These 41% of larger firms could potentially have problems.
• Although many businesses are aware of legal liability, only about 20% think they are likely to be sued in the event of their Year 2000 failure.

The Committee also heard that some companies are starting to stockpile inventory in case suppliers are not prepared. A more positive comment was that larger companies should insist that their suppliers, partners, and service providers be Year 2000 compliant. This would have a cascading effect and force many of the latter to start their Year 2000 remediation process.

A Task Force recommendation of interest to all areas of the economy was that Statistics Canada should carry out a third survey on Year 2000 readiness. This survey should focus on testing results and time lines and be expanded to include the public, para-public and private sectors with results made available no later than the end of March 1999. The Committee heard that Statistics Canada's next survey will indeed follow the Task Force's recommendation and focus on contingency planning, degree of preparedness, extent of testing, and the reliability of the assessments. Statistics Canada's client groups within the federal government, including the Department of National Defence, Health Canada, and the Department of Foreign Affairs, are working to clarify details of the information needed. The Committee expects to be briefed on the results of this third survey during the end of April-early May 1999 timeframe. This should allow the Committee to fully reassess critical areas of concern and determine what other measures may be needed.