Debugging costs Railtrack pounds 10m

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TECHNOLOGY company Logica will tomorrow announce a two-year contract with Railtrack worth pounds 10m to oversee the transport infrastructure company's efforts to ensure trains are not derailed by computer failure on 1 January 2000.

Logica, based in London, has been selected to work on the Year 2000 conversion of Railtrack's core IT infrastructure systems - of crucial importance if Britain's trains are to keep running into the New Year. The fear is computers will crash because they will not recognise the date change to 2000.

"It [Railtrack] is a company that is far-sighted enough to realise millennium work doesn't stop on 31 December, 1999. You have to work with customers right beyond the threshold," said a Logica spokesman. The company's contract will run until the end of 2000.

On Friday, United Utilities, the UK's largest combined water and electricity company, became the first utility to warn that essential services could fail because of problems associated with the millennium bug. The concern is that utilities will not be able to guarantee continued supply through the transition to 2000 because energy and water are highly vulnerable to computer problems.

Last week, travel insurance firms said they would not provide cover for what they described as "foreseeable events" like the millennium bug, which could lead to flight delays and baggage losses.

Founded 30 years ago, Logica has carved a niche for itself by specialising in the banking, telecommunications, utilities and transport sectors. For the financial year ending 30 June 1998, its pre-tax profits were pounds 41.8m on a turnover of pounds 473m.