Department of the Prime Minister and Cabinet
	PARLIAMENT BUILDINGS,WELLINGTON, NEW ZEALAND
	Y2K TASK FORCE

24 August 1998

The Hon M Williamson Associate Minister of State Services Parliament Buildings WELLINGTON

The Rt Hon W F Birch Minister of Finance Parliament Buildings WELLINGTON

The Hon T J Delamere Associate Treasurer Parliament Buildings WELLINGTON

Dear Ministers

Report of the Prime Minister's Y2K Task Force
The recommendations in this report are designed to improve New Zealand's readiness to manage any threats to vital parts of our infrastructure caused by Year 2000 date-related problems in computers and other equipment containing computer technology.

We began our task with some scepticism regarding the degree to which such threats were being represented. As we progressed, however, it became increasingly clear that the Year 2000 problem, if not effectively managed, has the potential to have a significant impact on the lives of many New Zealanders. It also became increasingly clear that some public and private organisations in vital parts of our infrastructure are not well prepared to meet the challenges presented by the Year 2000.

The uniqueness of the Year 2000 situation, a lack of real understanding of its implications and a difficult economic environment are combining to prevent the normal discipline of the market in the private sector, and the discipline of accountability arrangements in the public sector, from generating effective risk management strategies in sufficient time. Given the critical interdependence of the public and private sectors, some reinforcement from the Government is needed to ensure the nation can manage its way through the Year 2000 problem with as little fall-out as possible.

We do not suggest that Government action should supplant the present accountability arrangements or commercial decision-making, but we are concerned that, left to their own devices, these mechanisms will be too late in responding. Time is pressing and action is needed now. We believe the Government's role should be that of a catalyst for action.

In making that assessment, we are acknowledging that it is not too late. Inevitably, there will be some failures, but there is still sufficient time for significant remedial action and for contingency planning to manage the impact of failure if, when and where it occurs.

Our assessments in the wider public sector indicate serious shortages of resources and under-allocation of funding which may require reallocation of priorities within entities, or even across entities, should such needs be identified.

This report presents a number of recommendations for the Government to adopt to discharge its catalyst role. They are centred around promoting understanding about the possible impact of the Year 2000 problem, providing signposts for assistance, galvanising the skills and expertise of the private sector to tackle the issue from a national perspective and making sure the impetus created by the Government's action is maintained through monitoring, review and reassessment, as we move towards the turn of the century.

These recommendations hinge on three important principles.

The first calls for the Government to take an active role in articulating the importance of managing the Year 2000 problem in the national interest. This is a serious issue demanding the fullest attention from everybody from the Prime Minister to the manager of a city's water services.

The second reflects the need for the Government to intensify its efforts to make sure the wider public sector is ready to manage its Year 2000 problems.

The third is for the Government to act as a catalyst, facilitating and encouraging self-help in the private sector.

The vehicle for the Government's contribution is a Y2K Readiness Commission. The Commission's task, on behalf of the Government, is to manage the programmes that raise awareness, provide the signposts for assistance, harness the skills and expertise of the private sector in the interests of the nation and advise the Government on progress towards readiness. We believe a Commission made up of people from both the public and private sectors, and at arms length from the Government, will have the credibility and independence necessary to get all sectors working together towards a common goal; making sure that New Zealand manages the Year 2000 problem in the best interests of all.

We would like to record our appreciation of many individuals, groups and institutions in the public and private sectors - from those who met with us, to those who completed and returned yet another questionnaire. Their understanding, contributions and patience were appreciated.

I would like to thank my five Task Force colleagues - Michael Hannah, Ralph Norris, Judith Speight, Carol Stigley and Ross Tanner. Their commitment to the task, their contribution in terms of experience and expertise, and their ability to focus on the big picture made a difficult task less difficult and, certainly, more enjoyable.

Finally, we would like to thank Alan Jones and his secretariat team for the intensity of their commitment and the quality of their contribution. We commend this report for your consideration.

Sincerely